TOPIC: COLLECTIVE BARGAINING AGREEMENTS (use NFL as example)
the NFLPA (NFL Players Association) is preparing for the new CBA agreement that begins in 2021.
I have attached the following for your reference:
1) section from the text on Collective Bargaining
2) NFL Collective Bargaining Agreement from 2011
Prepare a written review based on a specific Management / Labor Relations topic. Again, please be sure that your topic s a contemporary topic in Labor Relations. If you have any questions or concerns regarding your topic, e-mail me. I recognize that your text contains subject matter that assists in satisfying this requirement; however, I am expecting elaboration on the topic chosen from not only a personal view but also from additional sources. Please keep your topic on a contemporary topic in Labor Relations. These sources include but are not limited to Internet sites, magazine articles, book reviews, etc. Personal examples and application of the topic to your current or future career focus are expected.
Negotiation is a common feature of everyday life. Although this chapter covers collective bargaining between union and management representatives over terms and conditions of employment, many aspects of negotiations have broader applications to other bargaining activities in society. This chapter first defines collective bargaining and explains initial influences affecting this activity. Subsequent sections consider negotiation preparation activities, such as bargaining team selection, proposal formulation and cost estimates, bargaining strategies and tactics, and legal requirements. The chapter places these diverse collective bargaining considerations in perspective by describing a “bargaining power model” to help predict a likely resolution framework.
Collective Bargaining: Definition and Structure
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. In short, they attempt to negotiate a new labor contract. Collective bargaining is a special form of interdependent social interaction, in which the attainment of desired outcomes by one party is dependent on thebehavior of another party. A dispute that arises between union and management representatives over what the terms and conditions of employment will be is termed an interest dispute. The basic objective of collective bargaining is to resolve such interest disputes by reaching an agreement acceptable to both parties (union and management).1 Attitudes of union and management officials toward collective bargaining and the negotiated settlement influence their relationship during the term or duration of the labor agreement. The fact that both parties generally understand that they will return to the bargaining table in future negotiations affects their strategic choices regarding acceptable tactics and outcomes in any current negotiation.
Defining success in collective bargaining often entails both objective and subjective evaluation criteria. Objectively measuring the economic value or cost of specific settlement terms to each bargaining party is one way to measure success. Comparing settlement outcomes to industry or area averages or settlement outcomes obtained by key competitors is another way. Depending upon the prevailing bargaining conditions, maintaining the status quo or conceding less than one might have been expected to concede under the circumstances could be defined as a successful bargaining outcome. Union leaders seeking reelection may consider the extent to which the interests of key constituent groups within the bargaining unit (e.g., skilled employees or women) are satisfied as one measure of success. One other criterion for measuring negotiation success is whether a bargaining settlement contributes to building a positive relationship between union and management representatives, which is necessary for the effective implementation of contract terms on an everyday basis.
It is not unusual for both union and management negotiators to claim success at the conclusion of contract negotiations. This may be possible due to the different priorities each party may place on achieving a desired outcome on specific bargaining subjects or a reflection of different criteria being applied by each party to measure success. A successful bargaining settlement reinforces a labor–management relationship, whereby the parties, although not always agreeing, nonetheless trust each other to be honest and straightforward in their positions without trying to unnecessarily damage the other party.2
Bargaining structure has two general dimensions: (1) independent employee groups that can affect the collective bargaining outcome and (2) the employees and employers who are subject to the provisions of the negotiated labor agreement (the bargaining unit). Each will be considered.
In some cases, union and management officials are influenced by the collective bargaining settlements of other, independent groups of employees. Often this is understood by both sides at the bargaining table. For example, a labor settlement between a city government and the police officers’ union might influence subsequent negotiations between that same city and its firefighters.
The term 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. Pattern bargaining may occur among similar companies in the same industry. For example, for many years the United Auto Workers (UAW) designated one auto manufacturer in each cycle of contract negotiations as the lead firm with whom the union would attempt to achieve a contract settlement. Terms of the “lead” contract arethen used as a pattern for negotiating labor agreements with other auto makers during the same time frame. For example, in the 2015 auto negotiations the agreement reached between the UAW and Fiat Chrysler became the pattern for subsequent settlements between the UAW and General Motors and Ford Motor Company. Increased nonunion competition and the 2007–2009 economic recession substantially curtailed pattern bargaining activity in recent auto industry negotiations. Pattern bargaining might also occur if union or management negotiators attempt to apply a settlement obtained for one segment of an industry (automobile manufacturing) to another company that produces related products, such as tires or headlights.
Management and union negotiators might prefer pattern bargaining as a way to “take wages out of competition” between unionized employers operating in the same product or service market. The objective of standardizing wages through pattern bargaining is beneficial for management because it will reduce concern about competitors receiving a labor cost advantage. Pattern bargaining is also beneficial to union negotiators because it builds a perception among similar types of workers (represented by the same union under contracts at different firms) that they are receiving equal and fair treatment from their union in securing negotiated improvements desired by the union’s membership.3 Sometimes management negotiators actively resist pattern bargaining in order to try to negotiate contract settlement terms which will provide the firm with a labor cost competitive advantage over other firms with whom the same union bargains. Increased competition by nonunion firms not covered under union-negotiated contracts (both domestic and international competitors) has also forced some unionized employers to resist pattern bargaining.
Sometimes negotiators think they are negotiating independently of other groups’ contracts; however, that is not how their counterparts see it. For example, union negotiators in one company may attempt to coordinate their bargaining strategy with other negotiators representing similar workers (e.g., different locals of the same union) in other companies. This clandestine coordination can take two different forms, based on whether the negotiations are occurring at the same time or different times. Each will be briefly considered.
A whipsaw bargaining strategy involves a negotiating team attempting to extract large, similar, concessions from multiple opponents; this is done by sharing information across negotiating teams on the same side as multiple negotiations proceed. For example, suppose the union at Company X is in contract negotiations and it gets a generous “vacation” clause. The union negotiators immediately contact union negotiators at Companies Y and Z (e.g., via cell phone text messaging) telling of this development. Those union officials at firms Y and Z, who are simultaneously negotiating with their respective employers, decide to “hold out” for a similar vacation clause. A few days later, suppose the union at Company Y secures a generous “paid maternity leave” clause. The negotiators notify their counterparts at Companies X and Z so they can try to secure similar maternity leave clauses. Meanwhile, the management negotiators at Companies X, Y, and Z are unaware that the union is attempting this strategy.
Recognize that managers sometimes use a whipsaw strategy also. For example, a municipal government with multiple unions (e.g., police, fire, bus drivers, office & clerical, airport workers) may open negotiations with all of them separately yet simultaneously, hoping to extract similar concessions from all of them.
One foundational principle of unionism is solidarity with other workers. If multiple unions are negotiating with an employer, can the unions agree in advance that no unionwill sign a contract until all the unions have agreed? Such an arrangement is called a lock-in agreement between unions; it prohibits any union-represented bargaining unit from reaching a final contract settlement until all unions who bargain contracts with the same employer are willing to settle. The intent of such a lock-in agreement is to force an employer with multiple unions to satisfy all of the unions’ concerns and to prevent the employer from using a whipsaw bargaining strategy. However, the National Labor Relations Board (NLRB) has ruled that lock-in agreements are unlawful.4 It is lawful for two or more separate unions (or bargaining units within the same union) to share information with each other about bargaining priorities, strategies, or employer-specific information. This can lead to establishing some similar negotiation goals. Sharing information and goals prior to bargaining, but bargaining independently of other union locals is called coordinated bargaining.
If the negotiations at different firms are taking place over several months or years, one party to the negotiation may attempt leapfrogging. 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. Imagine a scenario where the workers at Companies A, B, and C were all earning $20 per hour two years ago. The union structured negotiations so that the contract at Company A expired last year. The union negotiated a raise to $21 per hour. This year, negotiations occur at Company B. The union attempts a strategy of arguing that the organization should not use its own contract (paying $20 per hour) as its starting point for determining pay raises; instead, everyone should use the most recent contract in the industry (Company A, now paying $21 per hour) as the reference. The union further argues that since nearly a year has passed and some inflation has occurred, workers are entitled to more than $21 per hour. Suppose that they are successful in this gambit and get $21.33 per hour. When the next contract with Company C is negotiated (perhaps a year later), the union will argue that negotiators should focus less on their own $20 per hour wage and focus more on current industry standards (the $21.33 now paid by Company B) and what sort of pay raise above current industry standards is appropriate. Thus, each set of contract negotiations provides an opportunity for the union to negotiate wages that “jump over” (leapfrog) what others are paying in order to secure ever-higher wages. Leapfrogging in this example represents a coordinated strategy by the union locals, yet managers may not realize it.
In all of these examples, negotiators for the local union used the collective bargaining agreements (CBA) of other groups of employees as a prominent reference point to determine what should be in their own upcoming contract. These other groups were not part of the local’s negotiations, nor would the other groups be bound by the local’s contract—however, the negotiation outcomes of the other groups clearly played a significant role in the local’s strategy. Finally, recognize that these are bargaining strategies; there is no guarantee that they will work. The management negotiators may simply disregard what other companies pay their unions. Thus, successful pattern bargaining, whipsawing, or leapfrogging depends upon how persuasive the negotiators are when implementing the strategy.
The Bargaining Unit
The second dimension of the bargaining structure, the bargaining unit, refers to the employees and employers who will be bound by a negotiated labor agreement. As discussed further in Chapter 5, any appropriate bargaining unit (ABU) determined by the NLRB for representation election purposes is, by definition, a unit appropriate fornegotiating purposes (see the first example in Exhibit 6.1). Once a union has been certified as the representative of an ABU, two or more ABUs may be combined for the purpose of negotiating a single labor agreement to cover all ABUs if such a combination is acceptable to both the union and the employer(s).
Single Employer, Multiple ABUs
Most often, combining bargaining units involves two or more ABUs at one employer’s operation represented by the same union. For example, suppose that a company has several production facilities in three adjacent counties. While the same union may have won separate representation elections for each individual facility, the union may request that the ABUs from all three counties be combined for contract negotiations.
Sometimes ABUs represented by different unions are combined. For example, Harley-Davidson Motor Company operates a manufacturing plant in Kansas City, Missouri, where the International Association of Machinists and Aerospace Workers (IAM) and the United Steel, Paper and Forestry, Rubber Manufacturing, Energy, Allied Industrial, and Service Workers International Union (USW) were elected to represent two separate groups of plant workers but, with the employer’s agreement, have chosen to negotiate a single contract to cover both groups of workers. For another illustration, see the second example in Exhibit 6.1.
Whether to combine ABUs together for negotiation purposes is a non-mandatory subject of bargaining.5 That means that if, for example, the union wants to discuss the topic of combining ABUs, managers may agree to discuss it, but the management negotiators are not legally required to discuss it if they don’t want the ABUs to be combined. (By contrast, wages, hours, and working conditions are considered mandatory subjects of bargaining by the NLRB: If, for example, the union wants to discuss a wage raise, management is required to bargain with the union over it.)
There are several factors for both managers and union leaders to consider when deciding whether to allow multiple ABUs to combine for bargaining with a single employer. One or both parties might prefer companywide bargaining because of product interdependence, market factors, or legal considerations. For example, a company may have three manufacturing facilities, each having a separate ABU. If the products at the facilities are interdependent (Facility A’s product is needed for Facility B, whose product is in turn completed at Facility C), then management would probably prefer centralizedbargaining, producing a single contract expiration date and only one risk of a possible strike at all facilities—instead of three different contract expiration dates and possible separate strikes at different times at each of the facilities if each ABU negotiated a separate contract. Of course, should a work stoppage actually occur, the potential magnitude of the impact would be greater under centralized bargaining because all three covered plants would be affected immediately.
If the three facilities operate independent of each other—each facility producing a complete product or service itself (e.g., three steel mills, each producing steel beams; or three facilities producing unrelated products such as baseball gloves, cereal, and marbles)—management would probably prefer to negotiate a separate contract to cover the ABU at each independent facility. Separate negotiations would probably result in different contract expiration dates for the three facilities. Although each separate contract would involve the risk of a work stoppage when it expired, if one facility went on strike, the others could still continue production. In the case of facilities that produce similar products, management could transfer some of the orders from the striking facility to other nonstriking facilities where labor contracts had not expired.
Some observers believe that conglomerate companies with a wide range of products have too much bargaining power over unions. One sample of nine conglomerates revealed 846 different manufacturing products sold. A union threatening a strike to shut down one of these manufacturing facilities or even an entire product line might not be able to put sufficient pressure on a conglomerate to reach a bargaining settlement. Under this condition, a union would prefer companywide bargaining, realizing that if all facilities were covered under the same contract a strike could effectively shut down the company’s entire operations, thereby increasing union bargaining strength.
Multiple Employers, Multiple ABUs
Choosing to formally combine ABUs from different companies for negotiation purposes can take several forms. One version of this is centralized bargaining (also called industry-wide bargaining), where all of the major employers in a given industry negotiate one contract with one union (see the third example in Exhibit 6.1 for an illustration). Historically, the major coal mine operators in the Appalachian mountains negotiated one basic agreement with the United Mine Workers. Industry-wide bargaining is also found in some European countries. Sometimes, centralized agreements are comprehensive. In other industries, centralized agreements only deal with wages, benefits, and general working conditions (industry-level bargaining); firms also negotiate supplemental agreements dealing with specific working conditions for their firms (company-level or companywide bargaining) or their individual facilities (local-level bargaining).6
It is difficult for both employer groups and unions to maintain a cohesive structure for centralized, industry-wide bargaining over many years. That is because it is tempting for individual companies and/or union locals to try to negotiate separate agreements that take their “unique circumstances” into account. Consequently, sometimes centralized bargaining gives way to pattern bargaining.
Even if it doesn’t encompass most workers in an industry, multi-employer bargaining units sometimes occur at the regional level. These include more than one employer in a geographic region combining together to negotiate a single contract covering employees at each of the participating employer’s firms who are typically represented by the same union. Multi-employer bargaining may be found in trucking, motion picture and television, construction, longshore, and newspaper industries.
Finally, sometimes multiple employers negotiate a regional contract with multiple unions (see the fourth example in Exhibit 6.1). This is common in construction, whereseveral unionized contractors and subcontractors engage in council bargaining with several different labor unions at the same time. This approach not only insures that all of the contractors will pay the same wage rate for the same type of work, it can also serve to insure that traditional wage differentials are maintained between different groups across unions (e.g., perhaps skilled plumbers historically earned 160% of the wage rate paid to unskilled laborers).
Whether considered at the industry level or the regional level, market factors influence the degree of centralization of the bargaining structure. In a highly competitive product/service market, a multi-employer (centralized) negotiating unit would be desirable to employers who fear being placed at a competitive disadvantage if other employers subsequently negotiate lower labor cost terms. This would be particularly true for an employer with fewer resources (less bargaining power) than the union with whom the employer must bargain and whose firm also exhibited a high degree of labor intensiveness (i.e., the proportion of an employer’s total operating costs comprising labor costs). Agreeing to join other employers in a multi-employer bargaining unit strengthens an individual employer’s bargaining power and also minimizes another potential problem— the loss of customers to competitors should a work stoppage occur.
Unions are also concerned about market problems in some industries (construction, coal, trucking, ladies’ garments, longshore, and others) and attempt to extend the bargaining unit to include all unionized employers in a geographic area producing the same competitive product. This approach is taken to prevent a few employers with above-average bargaining power from separately negotiating lower wages, which could provide them lower production costs, thereby attracting customers from other unionized firms—resulting in layoffs at higher labor cost firms. In essence, unions are attempting to standardize wages, hours, and other terms of employment to reduce the importance of labor costs as a competitive factor and to force employers to compete on the basis of other nonlabor factors such as product design, product quality, and customer service. Multi-employer bargaining also has other advantages. A union engaged in multiemployer bargaining has a powerful advantage over rival unions because the NLRB holds that while a multi-employer bargaining unit is intact, it is the only appropriate bargaining/election unit. Thus, the NLRB will dismiss a rival union’s petition for an election in a single firm as long as the incumbent union and the firm are participants in a multi-employer bargaining unit. Both labor and management can benefit from the cost savings that accrue from having to prepare for fewer contract negotiations when separate ABUs are combined to form a centralized bargaining unit. The costs of preparing for and conducting negotiations can also be shared among employers participating in a multi-employer bargaining unit.
Multi-employer bargaining has some disadvantages. Over time, centralized bargaining tends to become more formal and less flexible in terms of meeting employee and employer concerns at an individual workplace. Because terms must be applied across different employee groups, often at different locations, bargaining outcomes tend to reflect a broader regional, corporate, or industry level perspective rather than emphasizing local conditions prevailing at any particular plant location. For example, wage and benefit trend data used to identify an appropriate bargaining outcome are more likely to reflect prevailing industry or national averages rather than local labor market conditions.
Finally, multi-employer bargaining can create tensions among the member employers. First, where there is a clear disparity in the size of the participating firms, larger employers may attempt to control the decisions of the multi-employer group. This may become a problem for smaller employers within the group whose perceptions may differ from larger employers regarding the affordability or administrative burden of acceptingcertain union bargaining proposals. Second, an employer might consider withdrawing from a multi-employer group if it feels it can get a better deal negotiating separately with the union. To legally withdraw from an existing multi-employer bargaining unit, an employer must provide both the union and other unit employers with reasonable advance notice (e.g., prior to the expiration date of the current agreement and before negotiations have commenced on a new contract).
The decision to engage in centralized bargaining can also be affected by legal guidelines. The size and makeup of a party’s bargaining team is a nonmandatory subject of bargaining.9 Suppose that only union representing a particular bargaining unit is participating in regional bargaining with a multi-employer group. That union could permit representatives from other unions who also bargain separately with the same employers to sit in on negotiations as part of the union’s bargaining team. Although the employers cannot control who sits on the union bargaining team, the employers could legally require that only the legal union representative of the bargaining unit covered by the contract under negotiation be permitted to decide whether to accept or reject management’s bargaining proposals.10 Union representatives from other bargaining units could function as observers in the negotiation process but could not exercise any authority over determining settlement terms.
The U.S. Supreme Court ruled that it is unlawful for an employer to withdraw from an established multi-employer bargaining arrangement during a bargaining impasse without the union’s consent.11 The employer’s withdrawal is not allowed, and the employer is bound to any subsequent agreement reached by the union and the multiemployer bargaining group.
Holley, William H.; Ross, William H.; Wolters, Roger S..The Labor Relations Process (Page 267-274).Cengage Learning. Kindle Edition.