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CHAPTER 6
Negotiating the Labor Agreement
Outline
I. Collective Bargaining: Definition and Structure
i. Collective Bargaining is an activity whereby union and management officials
attempt to resolve conflicts of interest by exchanging commitments in a manner
intended to sustain and possibly enrich their continuing relationship.
ii. Interest disputes
a. Bargaining Structure
i. Two general dimensions
b. Employee groups
c. Pattern Bargaining
i. Pattern bargaining is used to describe a situation where union or management
negotiators informally attempt to extend a negotiated settlement from one group
to another.
d. Whipsawing
i. Whipsaw bargaining strategy
ii. Lock-in agreement
iii. Coordinated bargaining
e. Leapfrogging
i. This strategy attempts to use the most recent contracts in the industry, even if not
your own, as the starting point for extracting further concessions.
f. The Bargaining Unit
i. Refers to the employees and employers who will be bound by a negotiated labor
agreement.
ii. Appropriate bargaining unit (ABU) (First example in Exhibit 6.1
g. Single Employer, Multiple ABUs
i. Single contract, multiple groups (Second example in Exhibit 6.1)
ii. Nonmandatory subject of bargaining
iii. Mandatory subjects of bargaining
h. Multiple Employers, Multiple ABUs
i. Centralized bargaining (industry-wide bargaining) (Third example in Exhibit 6.1)
ii. Multi-employer bargaining units
iii. Council bargaining (Fourth example in Exhibit 6.1)
iv. Degree of labor intensiveness
II. Negotiation Preparation Activities
a. Selection of the Negotiating Team and Related Bargaining Responsibilities
i. Characteristics of an effective negotiator (Exhibit 6.2)
ii. Personality factors
iii. How many negotiators?
iv. Management considerations
v. Union considerations
b. Proposal Determination and Assessment
c. Formulating Proposals
i. Analyzing contract language
ii. Examining prior arbitration decisions
iii. Economic and legal information
d. The Bargaining Range
i. A one-issue example
1. Resistance point
2. Target point
3. Bargaining range (Exhibit 6.4)
4. Contract zone
ii. A multi-issue example
1. Utility
2. Package proposals
e. Costing Contract Proposals
i. Cents-per-hour cost
ii. Roll-up factor
III. Understanding Collective Bargaining Behavior: A Framework
i. Walton and McKersie’s four bargaining processes
a. Distributive and Integrative Bargaining: Two Different Approaches
i. Distributive bargaining
ii. Integrative bargaining (interest-based bargaining, mutual gains bargaining or
win-win negotiations)
iii. Resistance point
b. Strategies and Tactics
i. Persuasive arguments
ii. Objective evidence
iii. Painting a picture
iv. Summarizing bargaining progress
v. Presenting a bargaining proposal in writing
vi. Nonverbal cues
vii. Bargaining caucus
viii. Use of positive reinforcement
ix. Linking issues (package proposals) (Example in Exhibit 6.4)
x. Matching concessions and splitting-the-difference
c. The bargaining Power Model
d. Factors Potentially Affecting Both Bargaining Power Equations
e. Factors Affecting a Union’s Disagreement and Agreement Costs
i. Claims of proponents and opponents of public aid
f. Factors Affecting Management’s Agreement and Disagreement Costs
g. Complexities Associated with the Bargaining Power Model
h. Attitudinal Structuring
i. Walton and McKersie suggestions
i. Intraorganizational Bargaining
IV. Ethical and Legal Considerations in Collective Bargaining
a. The Legal Duty to Bargain in Good Faith
i. Good faith bargaining
b. Type of Bargaining Subject
i. Illegal bargaining subjects
ii. Mandatory bargaining subjects (Exhibit 6.7)
iii. Mid-term bargaining
iv. Good faith bargaining impasse
c. Effects Bargaining
i. Voluntary bargaining subjects
d. Specific Bargaining Actions
i. Per se violations
1. Inability to pay
2. Unwillingness to pay
3. Requirements of information request
e. Totality of Conduct
i. Totality of conduct doctrine
ii. Boulwarism
iii. Examples of bad faith bargaining
f. Bargaining over Managerial Rights
i. Reserved rights doctrine
ii. Short-form management’s rights clause
iii. Long-form management’s rights clause
g. Successor Employer Bargaining Obligations
i. New employer
ii. Successor employer
iii. Successorship clause
h. Collective Bargaining under Bankruptcy Proceedings
i. Approval of bankruptcy conditions
i. Legal Remedies Associated with Violations of the Duty to Bargain in Good Faith
i. Board remedial orders
j. Proposed Labor Law Reforms
k. Contract Ratification
i. Contract ratification vote
l. Explanation of Voting Behavior
m. Reasons for Rejection of Tentative Contract Agreements
Discussion Questions
1. What are some situations in which management or the union would prefer centralized
bargaining? In what situations might both prefer centralized bargaining? Discussion should
take into account specific legal considerations affecting centralized bargaining.
This question can be directly answered from the material on "The Bargaining Unit" on
pages 270-271.
2. During an economic recession, discuss how management’s or a union’s bargaining power
might be affected. Give an example to illustrate what you mean.
During an economic recession management may make an actual or implied threat to close
3. Assume that you are a management negotiator and the union presents the following
proposal: “Any overtime assignment will be guaranteed a minimum of two hours at time-
and-a-half the base hourly rate for the classification.” Previously, employees working
overtime received time and one-half pay for the hours they worked but no two-hour
guarantee. Indicate in some detail how you would cost out this proposal. Also, discuss some
arguments the union might use to make it easier for management to accept this proposal (i.e.,
to reduce management’s agreement costs).
The cost of this proposal could be estimated from last year's manpower scheduling records.
More specifically the number of overtime assignments less than two hours would be isolated.
4. Identify some sources of information a union or management negotiator could consult to get
timely and relevant information about the following:
a. recent bargaining settlements in a particular industry
b. current wage rates for specific types of labor in a specific geographic area
c. health care cost and bargaining trends
d. pension benefits plans and trends
5. Good and bad faith bargaining might be easier to define than implement. Discuss different
types of evidence that might be used prove or disprove a charge of bad faith bargaining.
Violation of good faith bargaining come from nature of bargaining issues (wanting to
include an illegal term in the contract like paying less than federal minimum wage for
6. Briefly define each of Walton & McKersie’s four bargaining processes. Pick two of the
processes and discuss how they are similar and different. How might they be related?
• A distributive bargaining approach, (also referred to as interest-based bargaining,
mutual gains bargaining, or win–win negotiation) tends to view the two parties’
7. Are current legal remedies for bad faith bargaining adequate to promote compliance with the
LMRA’s goal of good faith bargaining? Why or why not? What recommendations would
you suggest for improving compliance with the goal of promoting good faith bargaining?
The biggest problems in implementing good faith bargaining are the lack of penalties for
Exploring the Web
Collective Bargaining
1. Duty to bargain.
2. Bankruptcy and collective bargaining.
3. Using a research database such as LexisNexis or ABI/INFORM, explore the issue of labor
contract rejections during the bankruptcy process.
4. Auto Industry and collective bargaining.
5. Visit the home page of the UAW Union and learn about the National Collective Bargaining
Departments of the UAW.
Suggested Readings and Term Paper Topics
1. How can computers be used in collective bargaining?
Possible references:
Barnett, V. (2003). The use of information technology in a strike. Journal of Labor Research, 24, 1, 55-72.
2. What do either (your choice) management science or management information systems
have to offer our understanding of negotiation and/or mediation?
Possible references:
Brehmer, B. and Joyce, C. R. B. (Eds.) (1988). Human Judgment: The SJT Approach. Amsterdam: North-
3. Some people say that it is essential to behave ethically when negotiating. Others argue
that there is no such thing as "ethics" when negotiating, because no one expects their
opponent to behave in an honest, trustworthy fashion--"let the negotiator beware" is
their motto. What do you think? Analyze the role of "ethics" in negotiations,
supporting your position.
Possible references:
Lewicki, R. J., & Robinson, R. J. (1998). Ethical and unethical bargaining tactics: An empirical study.
Journal of Business Ethics, 17, 665-682.
4. What effects do personality/individual difference variables (e.g., need for achievement,
locus of control, Machiavellianism) play in (either) negotiating or mediation? How
important are personality/individual difference variables in bargaining or mediation?
Possible references:
De Dreu, C. K., Weingart, L. R., & Kwon, S. (2000). Influence of social motives on integrative negotiation:
A meta-analytic review and test of two theories. Journal of Personality & Social Psychology, 78, 889-905.
Gilkey, R. W., & Greenhalgh, L. (1986). The role of personality in successful negotiating. Negotiation
Journal, 2, 245-256.
5. Assume that I am a union negotiator. You are a consultant, hired to teach me to be
more persuasive. What advice do you have to make me a more persuasive negotiator?
Be sure to support your position with scientific evidence.
Possible references:
Chaiken, S. L., Gruenfeld, D. H., & Judd, C. M. (2000). Persuasion in negotiation and conflict situations. In
M. Deutsch & P. T. Coleman (Eds.) The handbook of conflict resolution: Theory and practice (pp. 144-
165). San Francisco, CA: Jossey-Bass.
Sage.
6. Since the late 1950s people have been studying "risk" in a variety of situations. For
example, social psychologists have conducted a great deal of research on the "risky
shift" phenomenon. Janis discussed how political groups (e.g. presidential advisors)
make risky decisions in his book Groupthink. Cognitive psychologists have examined
how people evaluate alternatives and information to arrive at risky decisions. What
does this eclectic field of research offer the labor-management negotiator (if anything)?
Does it have any implications for managerial or union preparation for negotiation?
Support your position by citing research.
Possible references:
Bernstein, P. L. (1996). Against the gods: The remarkable story of risk. NY: Wiley.
Bottom, W. P. (1998). Negotiator risk: Sources of uncertainty and the impact of reference points on
negotiated agreements. Organizational Behavior and Human Decision Processes, 76, 89-112.
7. Many collective bargaining studies rely upon laboratory experiments using "games."
Billig has criticized this approach. Others (e.g., Locke) defend this approach. What do
you think?
Possible references:
Billig, M. (1976). Social psychology and intergroup relations. London: Academic Press (London).
Brams, S. J. (1992). Negotiation games: Applying game theory to bargaining and arbitration. New York:
Routledge.
8. What does the research on "anger" and "aggression" offer labor-management
negotiators? What is the appropriate role of anger in collective bargaining?
Possible references:
Allred. K. G. (1999). Anger and retaliation: Toward an understanding of impassioned conflict in
organizations. In R. J. Bies, & R. J. Lewicki (Eds.) Research on negotiation in organizations, 7 (pp. 27-58).
9. Assume that I am a management negotiator. You are a mediator, trying to teach me to
be "more creative." What advice do you have to make me a more creative negotiator?
(Why is creativity even important?) Be sure to support your position with scientific
evidence from the vast research on creativity.
Possible references:
Achterkamp, M. and Akkerman, A. (2003). Identifying latent conflict in collective bargaining.
Rationality & Society, 15, 1, 15-43.
Gittell, J.H., Nordenflycht, A. V., and Kochan, T.A. (2004). Mutual Gains or Zero Sum? Labor Relations
10. In the 1990s, several researchers in Communication Departments at major universities
have become interested in communication that occurs during negotiation and conflict.
Briefly summarize the major findings of this stream of research. What have they
learned? Argue for or against the relevance of their discoveries to labor and
management negotiators.
Possible references:
Burnett, K., & McKinley, E. G. (1998). Modelling information seeking. Interacting With Computers, 10,
285-302.
Donohue, W. A Diez, M. E., & Weider-Hatfield, D (1984). Skills for successful bargaining: A valence
11. Interview someone (e.g., a corporate lawyer) who has negotiated a labor contract. Ask
them to describe one case from initial planning through negotiations to an agreement.
Later, analyze their case in terms of effective and ineffective planning and bargaining
techniques. Does their experience match the material described in the course? How do
you reconcile any differences?
12. Suppose you were going to give me advice as to how to negotiate. Should I be "tough"?
"Conciliatory"? Should I make small or large concessions? Should my negotiating
style change as negotiations progress? In other words, how should I bargain?
Possible references:
Bulach, C. (1991). The Collective Bargaining potpourri: Is there a right way? Journal of Collective
Negotiations in the Public Sector, 20, (4), 281-292.
Chertkoff, J. M., & Conley, M. (1967). Opening offer and frequency of concessions as bargaining
strategies Journal of Personality and Social Psychology, 7, 181 - 185.
13. Mary Parker Follett, Dean Pruitt, and Alan Filley have all written about integrative
bargaining. How are their approaches, viewpoints, and suggestions similar? How are
they different?
Possible references:
Filley, A. C. (1975). Interpersonal conflict resolution. Glenview, IL: Scott, Foresman, & Co
The collected papers of Mary Parker Follett. NY: Harper & Brothers.
14. Compare any three of the following books on power. Although not every book was
written for the field of labor-management relations, each has some degree of
applicability to this field. Which perspective seems to be the most accurate and useful
for understanding union-management relations?
Possible references:
Boulding, K. (1989). The three faces of power. Newbury Park: Sage.
15. Critique one of the following popular books on negotiating:
a. Cohen, H. (1980) You can negotiate anything. NY: Bantham.
b. Buskirk, R. (1989). Frontal attack, divide & conquer, the fait accompli, and 118 other
tactics managers must know. NY: Wiley Books.
c. Bernstein, A. J., & Rozen, S. C. (1989) Dinosaur Brains: Dealing with all those
impossible people at work. New York: Wiley.
Critique the techniques of your chosen book in light of scientific evidence supporting
or refuting these techniques.
Possible references:
DiGenio, J. (2002). Negotiating for success. Armed Forces Comptroller 47, 4, 21-24.
Lewicki, R., Saunders, D., & Minton, J. (1999). Negotiation. Homewood IL: Irwin/McGraw-Hill.
16. Blake & Mouton have been called, "the founding fathers of the field of Conflict
Management." Critique their writings dealing with bargaining and conflict at work.
What are the strengths and weaknesses of their perspective?
Possible references:
Blake, R. R., & Mouton, J.S. (1964). The managerial grid. Houston, TX: Gulf Publishing.
Blake, R. & Mouton, S. (1984). Solving costly organizational conflicts. San Francisco: JosseyBass.
17. How has power been studied in bargaining research and in the field of labor-
management relations and collective bargaining? What effects do different types of
power have upon the bargaining relationship?
Possible references:
Deutsch, M., & Schichman, S. (1986). Conflict: A social psychological perspective. In M. G. Hermann
18. When some people bargain, they seek only to achieve their own goals. When others
bargain, they seek to "beat" their opponents. Still others cooperate. Using the scientific
evidence, tell me: When should I be cooperative, competitive, or individualistic?
19. In their book Getting to YES (1981, Boston: Houghton Mifflin), Fisher & Ury argue
that negotiators should set aside "trust." They seek to offer a model in which trust is
not a necessarily important aspect of the bargaining relationship. McCarthy (1985,
Negotiation Journal, 1, 59-66) believes trust is essential. Using the scholarly and
research literature, present your opinion on the importance of trust in bargaining.
Possible references:
Deutsch, M. (1973). The resolution of conflict. New Haven, CT: Yale University Press.
Kramer, R. M. (1999). Trust and distrust in organizations: Emerging perspectives, enduring questions.
20. How do situational factors (e.g., bargaining power) affect bargaining behavior? Why?
Possible references:
Brislin, R. W. (1991). The art of getting things done: A practical guide to the use of power. Westport, CT:
Praeger Trade Books.
Druckman, D. (1971). The influence of the situation in interparty conflict. Journal of Conflict Resolution,
15, 523-555.
Social Psychology, 42, 867-883.
21. Most models of bargaining assume that people's bargaining behavior is governed by
economic motives. Contrast this traditional approach with the human judgment model
offered by psychologist K. R. Hammond and associates.
Possible references:
Achterkamp, M. and Akkerman, A. (2003). Identifying latent conflict in collective bargaining. Rationality
& Society, 15, 1, 15-43.
Arkes, H. R., & Hammond, K. R. (1986). Judgment and decision making: An interdisciplinary reader.
Cambridge, UK: Cambridge University Press.
22. What does "game theory" offer negotiators? What can this discipline (field of study)
offer to the field of collective bargaining?
Possible references:
Brams, S. J. (1990). Negotiation games: Applying game theory to bargaining and arbitration. NY:
Routledge.
Budescu, D. V., Erev, I., & Zwick, R. (1999). Games and human behavior: Essays in honor of Amnon
Rapoport. Mahwah, NJ: Lawrence Erlbaum Associates.
23. Compare and contrast the following models of bargaining. Does the scientific evidence
support one of these in particular? Is any one theory more practical than any other?
24. Reed C. Richardson (1985) argues for a "collective bargaining by objectives" approach
to contract negotiations in a book by the same title. Evaluate his approach and either
argue for or against it.
Possible references:
Morrison, W. F. (1985). The pre-negotiation planning book. NY: Wiley.
25. During the past 20 years, numerous political scientists have done case studies of
coalition formation within political organizations (e.g., Parliaments). Meanwhile, social
psychologists have conducted precise, well-controlled studies of coalition formation
within larger groups. What have these years of coalition formation research
discovered? How are these findings relevant, if at all, to labor management relations?
How are they relevant to relationships within labor unions (what Walton and
McKersie call, "intraorganizational bargaining”)?
Possible references:
Komorita, S.S. (1984). Coalition bargaining. In L. Berkowitz (Ed.), Advances in experimental social
psychology, vol. 18. NY: Academic Press.
Lewicki, R. J., Sheppard, B. H., & Bazerman, M. H. (Eds.) (1986). Research on negotiations in
26. How can research done on nonverbal behavior be used in labor-management
negotiations?
Possible references:
DiGenio, J. (2002). Negotiating for success. Armed Forces Comptroller 47, 4, 21-24.
Drolet, A., & Morris, M. W. (2000). Rapport in conflict resolution: Accounting for how face-to-face
27. Is there really a personality type that can be called “Machiavellian”? Or is
Machiavellianism really a trait that lies within each of us, that emerges only under
certain circumstances (as generally argued by Mischel, 1968)? Put another way, do
specific people have some traits and others have different traits that determine people's
behavior? Or is behavior determined more by the situation? What are the implications
of this argument generally, and Machiavellianism specifically, for collective
bargaining? When possible, support your position with empirical evidence.
Possible references:
Burnsted, B. (1973). The manipulator: A Psychoanalytic view. New Haven, CT: Yale University Press.
Dieter-Meyer, H. (1992). Norms and self-interest in ultimatum bargaining: The prince's prudence. Journal
28. How do "attribution" and "self-fulfilling prophesy" errors affect day-to-day labor
management relations? What role do they have in collective bargaining? What are the
effects? How can these effects be used to your advantage when negotiating?
Possible references:
Brewer, M. B., & Kramer, R. M. (1985). The psychology of intergroup attitudes and behavior. In
Rosenzweig, M. R., & Porter, L. W. (Eds.) Annual Review of Psychology, 36, 219-243.
29. What are "decision frames”? How are they important for understanding collective
bargaining and/or labor mediation?
Possible references:
Bazerman, M. H., & Neale M. A. (1991). Negotiating Rationally. NY: Free Press.
350.
30. What role does "impression management" play in labor-management relations? In
collective bargaining?
Possible references:
Giacalone, R. A., & Rosenfeld, P. (Ed., 1990). Impression management in the organization. Hillsdale, NJ:
31. Using writings from the fields of "debate" and "interpersonal communication," offer
advice on how to be more persuasive when bargaining.
Suggested references:
Branham, R. J. (1991). Debate and critical analysis. Mahwah, NJ: Lawrence Erlbaum Associates.
Cupach, W. R. & Spitzberg, B. H. (Eds., 1994). The dark side of interpersonal communication. Mahwah,
32. Analyze the contributions of Morton Deutsch to our understanding of conflict and
bargaining. What is his greatest contribution? Do you agree or disagree with his
theories? Support your position.
Possible references:
Deutsch, M. (1973). The resolution of conflict: Constructive and destructive processes. New Haven, CT:
Yale University Press.
Additional Information on How This Case Was Settled
CASE STUDY 6-3 The Influenza Work Rule
This case is based on the Virginia Mason Hospital and Washington State Nurses Association
(see Case 19–CA–030154; Case 19-CA-30154; 357 NLRB No. 53).
This is a very complex case, with numerous issues bouncing back and forth between the
• The Union had waived its right to use grievance arbitration to object to the new flu-
wording of the Managerial Rights clause.
• The Hospital argument that the facemask policy was required by the federal Centers for
• The argument that the Hospital made that a flu policy was a “fundamental business
• The Administrative Law Judge ruled that true bargaining had not taken place. Most of
• The Hospital was found to violate the “good faith bargaining” requirements by not
Thus, although the Hospital “won” on the arbitration issue, it “lost” on the issue of whether it had
