High stakes collective bargaining

by External23 Nov 2011

Recently, I had the privilege of working closely with a client who was experiencing a significant ‘high stakes’ collective bargaining situation. Like many an employer, this one could simply not afford to yield to what it regarded as exorbitant union demands. Like many an employer, it knew that it would confront protected industrial action designed to hurt the business. Like some employers, any conflict with the union would attract inevitable media attention.

So it caused me to reflect upon life inside the employers’ collective bargaining ‘think-tank’ and the ingredients necessary to define and execute an optimal strategy. What are those elements? As I see it, they are as follows:

1. The Cabinet

A key element is the marshalling of the right people around the table who combined provide the right inputs in order to make for effective decision making. This is like any other mission-critical project where an organisation brings together the necessary resources.

Usually, there will be senior management present. In a private business, the owner will be at the head of the table. In addition, there will be senior human resources representatives and one or two representatives from the negotiating team. Where litigation is possible, the in-house lawyer is sometimes present. Finally, there are the communication specialists, particularly if there is a prospect of external media exposure.

2. The Negotiating Strategy

This needs to be thought through at various levels. At one level, there is the defining of claims, the basis for objecting to union claims, and the various tactics that might be applied in such a negotiation. At another level, there are broader questions that demand consideration. Will we negotiate in the face of industrial action? What is the relative leverage equation? What is our walk away point?

The dynamics of any negotiation evolve over time and respond according to the relative leverage that is applied. Usually, an employer is sensitive to the prospect of industrial action and other activity which is difficult to manage such as:

  • go slows
  • increasing incidence of ‘sickness’; and/or
  • alleged safety issues (or ‘alleged safety issues’)

Identifying ways to moderate the impact of such leverage is a key ingredient in any employer’s negotiating tool kit.

Indeed, another client of ours was recently able to withstand a full strike of all employees for some weeks. It was able to do this because staff were able to produce as much, if not more, of the company product than was typically the case by the manufacturing workforce! The coverage swung back in favour of the employer.

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