Labor-management negotiations are a particularly powerful example of how parties with different interests can interact in a manner that leads to both parties losing, for example through a strike or lockout. Moreover, negative interactions on important labor negotiations can set the tone for the future relationship between the parties, potentially crippling the organization for years.
Game theory has played a key role in helping the parties in labor negotiations avoid mutually destructive results. Open Options has participated in a wide variety of labor-management planning and negotiations, allowing our clients to secure an optimal outcome, while maintaining a sustainable working relationship with their counterparts.
It is typically incomplete to view labor-management negotiations as bi-lateral interactions. For example, it can be important to differentiate the interests of union leadership versus rank and file, national versus local union leadership, or younger versus older workers. Understanding the many different perspectives and interests is critical to securing a positive outcome for both the short and long term.
Below is a selected list of some of our success stories, in helping our clients manage their labour negotiations. Please contact us to learn more about our process and review a relevant case study.
Dealing with Multiple Unions – “Take Off” Show more
An Airline with several unions and a recent breakdown in management-union relations was preparing for upcoming negotiations with their pilots. The client worked with Open Options to model the available options and interests of pilots union executive, union rank and file, other related unions, the airline management, and the airline’s board. Analysis showed clear differences in the effectiveness of the various levers of influence available to management.
Labor Negotiations – “Window of Opportunity” Show more
A major manufacturer was faced with difficult upcoming contract negotiations and at the same time was experiencing ongoing cost problems with a money-losing division. Open Options worked with the client to model the available options and interests of the union, the client, and its major competitor. Analysis showed there was a narrow window of opportunity to achieve a beneficial labor settlement and to significantly restructure itself and the industry.
Negotiating Supply Agreements – “Three Way Showdown” Show more
A large manufacturer was trying to end a history of subsidies to a supplier. However, a powerful union, who wanted continued prosperity at the supplier, represented the workers at both the manufacturer and the supplier. The supplier was a subsidiary of a larger corporation who was not very interested in staying in the business of supplying the Client. Complicating the issue further, internal groups of the Client, such as the Logistics and Labor Relations Departments, had differing opinions on what should be done.
Achieving Policy Targets – “For the Greater Good” Show more
A government agency was frustrated by lack of progress on its key public policy targets. The agency recognized that achieving its goals was going to require cooperation from employers, unions, other government institutions, as well as the governing political party. The agency came to Open Options to help it make progress on its public policy target rates, taking into account all affected parties.
Open Options has experience in the following aspects of labor negotiation:
- Contract renewal
- New contract negotiation
- Interactions between multiple unions
- Certification threats
- Local versus national
- Implications of spin-offs
- Strike management
- Long range labor planning