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Management as an Actor in Industrial Relations

Management as an Actor in Industrial Relations. Nonunion or Union Nonunion Direct Effects Lowers profitability Indirect Effects Productivity Wage Distribution Internal Labor Markets. BUSINESS STRATEGY AND MODERN (UNIONIZED) PRIVATE SECTOR INDUSTRIAL RELATIONS. TWO DISTINCT PERIODS

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Management as an Actor in Industrial Relations

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  1. Management as an Actor in Industrial Relations • Nonunion or Union • Nonunion • Direct Effects • Lowers profitability • Indirect Effects • Productivity • Wage Distribution • Internal Labor Markets LIR 858/Mgt Strat

  2. BUSINESS STRATEGY AND MODERN (UNIONIZED) PRIVATE SECTOR INDUSTRIAL RELATIONS • TWO DISTINCT PERIODS • 1930’s - 1970’s • Since 1970’s LIR 858/Mgt Strat

  3. Unionized Labor Relations Models 1935 Through 1970’s • Institutionalized Adversarialism (New Deal Model) • mutual recognition of institutional legitimacy of other party • sharply defined roles • Management manages the organization • Union protects and represents the workers • Long-term contracts • Rights of each party • Workplace laws • structured communication - negotiations and grievance procedure LIR 858/Mgt Strat

  4. Nonunion Models Developing in 1960’s • Emulate Union Models in some ways • Written Policies • Corporate or Division Wide • Removed discretion of first-line supervisors • With flexibility because policies can be changed or interpreted to fit changing environment LIR 858/Mgt Strat

  5. Bifurcated Private SectorIR System • By late 1970’s • Unionized sector • Manufacturing • Construction • Utilities • Nonunion sector • Retail • Business Services LIR 858/Mgt Strat

  6. THREE POST-1970’S EMPLOYER STRATEGIES • DEUNIONIZATION • CONFLICT • INVESTMENT • TRADITIONAL ADVERSARIALISM • COOPERATION • MANAGEMENT NO LONGER NECESSARILY WILLING TO ACCEPT “NEW DEAL” SYSTEM AS THE MODEL OF BARGAINING LIR 858/Mgt Strat

  7. DEUNIONIZATION - Conflict • Use of legal right to bargain without concessions • Union Options • accept an “unacceptable” contract • strike and risk replacement • Er may permanently replace strikers • Claim “good faith doubt” about union’s majority status • “Pyramiding” of legal rights by employer LIR 858/Mgt Strat

  8. Deunionization/ConflictExamples • Detroit Newspapers • International Paper • Greyhound • Continental Airlines (mid ‘80’s) LIR 858/Mgt Strat

  9. DEUNIONIZATION -Investment • Company invests in nonunion facilities • “greenfield” • older nonunion facilities • Examples • rubber tire industry • some paper processing firms • auto industry (Mexico) LIR 858/Mgt Strat

  10. TRADITIONAL ADVERSARIALISM • Examples • Trucking Industry • Aerospace • Airlines LIR 858/Mgt Strat

  11. COOPERATION • Creation of non-adversarial structures for communication • Reduce labor costs by reducing the costs of adversarialism • Permits firm to better exploit knowledge of workers • Focus on common, rather than conflicting, interests LIR 858/Mgt Strat

  12. MANAGEMENT COLLECTIVE BARGAINING STRATEGIES Conflict/ Deunionization Institutionalized Adversarialism (Traditional) Cooperation LIR 858/Mgt Strat

  13. Different Bargaining and Contract Administration Models • Bargaining • Adversarial: Positional Bargaining • Each side provides position to other party • Listens • Modifies position • rationale • bargaining power LIR 858/Mgt Strat

  14. CooperativeInterest-Based Bargaining Processes • Example: Mutual Gains Bargaining • Define problems and interests - separate • Discussion of problems and interests - joint • Brain-storming of solutions - joint • Recommendations of possible solutions - separate • Presentation of recommendations and selection of solutions - joint LIR 858/Mgt Strat

  15. Administration Process • Longer-Term Agreements • Problem-Solving Teams • Team-Based Production • Joint Committees LIR 858/Mgt Strat

  16. Examples of Cooperative Relationships • Philip Morris and BCTW Local 13 • National Steel and United Steelworkers of America • Ford and UAW • Philip Morris (Trenton, Ohio) and UAW LIR 858/Mgt Strat

  17. Fundamental Question • Does Management challenge the institutional legitimacy/status of the union? • No • Cooperation • Institutionalized Adversarialism • Yes • Deunionization LIR 858/Mgt Strat

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