Question

Discuss why must labor and management be able to accurately determine the cost of wage proposals?   What is one of the general wage concern that management and employee representatives bring to the negotiating table and why is it a concern?

Answer 1

1. Both sides need to be able to estimate accurately the cost of the contract provision in order for it to be intelligently discussed and bargained for by one side or the other. Management must be able to know the future total cost of the package in order that effects on product pricing, sales, etc. can be estimated. Management usually starts negotiations with a “ceiling” economic total in mind that represents the absolute maximum it can afford to give up. Labor usually starts with one or minimum increases in items that it feels is deserved and/or necessary to get membership approval of a proposed agreement.

2. One of the general wage concern that management and employee representatives bring to the negotiating table is Collective bargaining.

Collective bargaining is the process of employers negotiating contracts with unions. The process is engaged to secure agreements that will regulate compensation, benefits, and worker rights for employees who are members of the union. Collective bargaining results in a labor agreement that then becomes the contact between the employer and union.

Collective bargaining ensures that represented union workers have agreements that enable workers to earn and maintain middle-class wages and health and pension benefits. The wage concerns center on what constitutes middle-class wages and how the collective package of wages and benefits aligns to this standard. For example, agreements will often contain terms and conditions on overtime wages that management will want to factor into the middle-class standard where the union representatives will want this considered separately from the regular time wage discussion.