Question

You work as the lead HR Manager for BWA Enterprises, a company that builds parts for one major car manufacturer. On the organization chart, management, and administrative tasks are represented by rectangles, the union is represented by the ovals.

You are preparing for negotiations for the next CBA. The current, 3-year CBA is set to expire in 12 months.

At present, there is a new union president that you have found very difficult to deal with; the union is considered antagonistic towards management ideas, proposals and policies. The grievance rate has increased significantly since the last round of negotiations; primarily around issues of safety, overtime requirements (due to not enough workers to cover all of the shifts), non-fulfillment of benefits, and inadequate training when a new product line is introduced.

On the other hand, management is sympathetic towards creating a better working environment around the areas of grievance. The key will be to find a mutual way to address the concerns. However, stakeholders have also drawn a hard line along areas of pay-raises, more benefits, retirement options and years of service increases (such as extra vacation days, salary grids, holidays for birthdays, etc.).

40% of our annual gross profit of $10 million dollars go to employees within the union (80 members) for salary, benefits, and retired employee benefits. 20% goes to administrative and management, 25% goes to inventory, taxes, equipment, and facilities, and other supporting costs. The remainder is stockholders equity.

Financially, BWA enterprises is in the black, but because of recent tariff and trades restrictions across the border, our main customers have already given notice that they will be looking to domestic sources for the parts we produce. Also, our research department has reported that several of the jobs currently being filled by humans has the potential to be automated by AI within a 2 – 5 year timeframe based on new inventions and research. The union is aware of this development.

1. Reflection -

• Comment on the differences between both sides in the bargaining process given the external environmental factors you have already been given.
  • Why would management want a 2-year CBA while the union would want a 5 year CBA
  • What compromises do you see as being easy for both sides, which will be more difficult?
  • With each negotiation away from the initial offers, there will be compromise; who loses out with each compromise that is given?
  • Describe the scenario above in terms of what would make it win-win, lose-lose and win-lose (for both sides).
• Describe how the proposed changes will affect the bottom line of company profits.

Answer 1

1. The executives is confident that innovative headway will prepare for robotization. Human occupations will get supplanted by machines. This will be financially savvy just as exact for the organization. Consequently the organization is searching for multi year CBA, so that after that they can investigate mechanization alternatives. Association, then again, wants employer stability for the workers for a long span. Henceforth they are contending for multi year CBA.

2. A shared accord can be shown up when the CBA is produced for a long time. This will satisfy both association's and the executives' viewpoint. Increases in salary won't be attainable in the conditions where the organization is at the skirt of losing some principle clients. The organization can, anyway satisfy the preparation necessities of the association. Preparing will sharpen the abilities of the workers, in this way expanding their general execution and encouraging the viability of by and large business process.

3. With the arrangement of doing a multi year CBA, the association will lose employer stability for the workers by 2 years. No thought of salary increases, again will influence the procuring limit of the workers. Encouraging preparing for the representatives will be a success win circumstance for both. Workers will pick up aptitudes, which may expand their fairly estimated worth, organization will have better ability and in this manner generally execution of the business will improve.

4. Scenarios in terms of :

Win-Win: Facilitation of preparing will be a success win circumstance for the two gatherings. . Workers will pick up aptitudes, which may expand their fairly estimated worth, organization will have better ability and accordingly by and large execution of the business will upgrade.

Predicament: choice of not considering salary increases can be an impasse for both the gatherings. The workers may get demotivated if there is no salary increase. This may unfavorably affect their exhibition. Organization may think of it as a success win circumstance, yet in since quite a while ago run, it will be a losing circumstance for them. This is so on the grounds that as the presentation of the representatives will get hampered due to non-thought of salary increase, the general productivity and viability of the business procedure will get affected significantly.

Win-Lose: The accord of multi year CBA will be a success circumstance for the organization as by at that point, mechanization openings will be immense and they can gain by the equivalent. Workers would lose 2 years of employer stability which can be a major risk to their general steadiness. Thus it will be a losing condition for them.