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Good Union Relationships Are Best

January 26, 2001
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Related Topics: Labor Relations, Featured Article
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For more than twenty years, I havenegotiated labor contracts for hotels, distributors, sports stadiums, and othercompanies located in various regions of the country. In most of thesenegotiations, I have attempted to have my management clients and their unionslearn how to work together to solve their respective problems rather thanconfront each other to see who is stronger or craftier.

    In labornegotiations, and in counseling unionized companies between negotiations, I havemet some great Human Resource Directors ("HRDs"), some weak ones, andsome in the middle. The best were those who built a good relationship with theirunions. The worst were those who viewed their role as fighting with their unionsand teaching the rest of the management team how to do the same. The ones in themiddle played little leadership role either way.

    Every three years orso in a unionized company, the collective bargaining contract expires and has tobe renegotiated. The HRD is usually a member of the negotiating team. Betweencontracts, grievances have to be handled, contracts have to be interpreted andadministered, and employee and union questions have to be answered. How HRDsapproach such union responsibilities and what philosophy of labor relations theyfollow is, in my opinion, critical to their success in handling suchresponsibilities.

Employees are usually incloser contact with the customers than is management.

    Unfortunately, thenorm in most unionized American companies continues to be confrontation. Theconventional wisdom is still that unions are an adversary to be held at bay,opposed, outsmarted, defeated, or ignored. More often than not, unions areviewed as the villainous Indians and management is viewed as the white-hattedcowboys in a simplistic cowboy and Indian movie.

    Too many managersstill let their emotions or political beliefs dictate their labor relationspolicies, even though they use logical, result-oriented decision-making in everyother area of their business. Sometimes outside labor advisors encourage thisconfrontational approval and profit from the prolonged fights that result fromit. The problem with this cowboys and Indians picture of union relations is thatit does not reflect the reality of a unionized workplace today.

    Unionized workplacestoday, like all workplaces, require higher morale, productivity, participation,and adaptability to be successful. HRDs need to educate management to follow acooperative approach to unions if they want to achieve a successful workplace.

    The history ofAmerican labor relations shows that unions have been very good at holding on towhat they have, even when they have not been effective in organizing newemployers. As a result, a union relationship for most companies is like amarriage for which there is no divorce. It can either be a good marriage or abad one, but it is unlikely to end any time soon. In view of that, one wouldthink that the rationale approach would be that a good marriage is both moreproductive and more peaceful than a bad one and worth pursuing.

More often than not, unionsare viewed as the villainous Indians and management is viewed as the white-hattedcowboys in a simplistic cowboy and Indian movie.

    Companies existtoday in an environment where they need to be able to adapt rapidly to theircustomer's changing needs. Employees are usually in closer contact with thecustomers than is management. As a result, companies need to capture theiremployees' perceptions about customers and their ideas for improvement andincorporate them into continuously improving their service and products. To dothat requires effective employee participation and empowerment programs. It isboth legally and practically difficult to obtain such participation andempowerment in a unionized company without the active involvement of the union.

    The unionizedcompanies that are most successful in harnessing their employees' ideas havefound that the only effective way of making employee participation work isthrough a cooperative relationship with their unions.

    Another importantreason HRDs should lead the effort to develop a partnership with unionizedemployees and their representatives is the need to increase productivity. Unionworkers in a confrontational environment often perform well below theirpotential. When unionized workers face a contract fight every three years overwage, benefit, and work rules, and an ego contest over which side is craftier andmore powerful, why would their loyalty and their desire to be productive be anymore than average?

    When unionizedemployees face a cowboys and Indians environment at work, they often focus theirattention on more rewarding activities away from the workplace. When, on theother hand, workers are accorded a voice on the job and high levels ofparticipation and respect at work, they often develop the committed attitudenecessary to achieve a maximum effort at work.

    Yet another reasonHRDs should strive for a partnership with their unions is the need for moreeffective training programs because of the requirement for higher skilledemployees. Employees today have to be able to read and use computers and toadapt to rapidly changing technology in order to meet customers' needs, to workin offices and warehouses, to sell products in the field, or even to drivetrucks.

    Those companies thathave engaged in active partnerships with their unions have found that suchpartnerships are a significant advantage in establishing effective trainingprograms for their unionized workers.

The Los Angeles Dodgers andtheir unions worked together to reduce wage levels by as much as 25 percent toregain parity with their competition.

    Employees quiteoften perceive management's unilaterally established training programs as thelatest "fad of the month" by someone in the corporate office. Theytypically believe that such training has little relevance to their work, orworse, is a disguised way to set them up for termination in order to bring inyounger, cheaper workers. On the other hand, training programs that are jointlydeveloped and implemented with unionized employees make the employees takeownership of the training. In addition, joint training programs between unionsand management are more successful in attracting government training grants thanare individual company's training programs.

    HRDs should alsostrive for union cooperation because it is a more effective strategy for findingreal solutions to complicated problems. Resolving problems with both sides' needsin mind is more effective in finding solutions that works than attempting toforce solutions either side unilaterally creates in a vacuum. To put it anotherway, interest-based bargaining works better today with companies' complexproblems and more educated workforces than does traditional power bargaining.

    Using aninterest-based partnership approach to bargaining, the San Francisco hotels andtheir unions created training programs to attract and retain the best workers.The Los Angeles hotels and their union cooperatively "privatized" theunion hiring hall and improved its quality. The Los Angeles Dodgers and theirunions worked together to reduce wage levels by as much as 25 percent to regainparity with their competition. Toyota and its unions at the NUMMI plantdeveloped superb employee participation systems for continually improving theirautomobiles. Ford Motor Company and its unions worked together to make Fordprobably the most productive and profitable automobile company in America.

    None of this couldhave happened using power bargaining. The problems in each instance were toocomplex to resolve through confrontation. Unless both sides' needs can beanalyzed and addressed, complex problems like those listed above are seldomreally solved in negotiations and usually result in last minute, unworkablebargaining table compromises or a strike and the resulting poor morale anddesire to retaliate by the losing party.

    Are unionizedemployees and their representatives open to the cooperative approach advocatedhere? In my experience, I have found that they are. When approached honestly andasked to form a partnership with management to improve the workers' skills,ability, and participation, and to improve the company's viability, myexperience has been that unions are willing participants..

    The AFL-CIO has formany years actively promoted labor-management partnerships between unions andmanagement as the best way to satisfy both sides' needs and to build strongunionized companies. The AFL-CIO and many of its affiliated unions take theposition today that organized labor should present management with two, and onlytwo alternatives. These are (1) an "open hand of cooperation" for realpartnerships or (2) a "closed fist" for a fight in a confrontationalrelationship. Given these two alternatives, which is more likely in a unionizedcompany to result in high morale and productivity, the ability to solve complexproblems, and adaptability to changes in the economy?

    In sum, the bestHRDs strive to have their companies work cooperatively with their unions becauseit increases productivity, service, quality and morale, not because they fearunions. If HRDs want to be effective and make a difference, they should educatesenior management that this is the best way to work with unions and they shouldtrain junior management how to do so.

    HRDs may have tofight an uphill battle to accomplish this, since most American companies stillfollow a confrontational and emotional approach to unions instead of a rationalone. However, I have seen many HRDs accept that challenge and successfullyeducate management to move in the partnership direction, and they have uniformlyachieved better results for their companies by doing so.

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