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Art of negotiation, conflict resolution, skills training and Pendulum System can reduce pain of labour strikes

October 2011

Now that the strike season is almost over, it is time for a sombre reflection, not on the iniquity of withdrawing labour and inconveniencing the public, but on why strikes are such a continental phenomenon and how labour disputes can be painlessly resolved.

The right to strike is an important one for workers in most of the civilised world. Justice demands a reasonable parity of power between the workforce and the employer, to ensure decent and fair treatment and living wages for employees.

Unfortunately the definition of fair treatment and a decent living wage is always in dispute, hence every year the bargaining process would be held and lack of an agreement often leads to labour strikes.

We all have opinions on corporations, government and unions based on our personal world views and experiences, and that is as it should be in a free society. But the common good would be better served if we tried to limit and understand our biases and be more objective.
All unions possess a common desire for a company to succeed, based on workers' flexibility and employee security, on company growth through workers' skills and development as well as delivery of quality products and services with quality people. Management strive for the same, but with profits.

That is why it is not an easy decision to walk out. Strikers lose money when the principle of no work no pay applies. Jobs are at risk. They get vilified. So, management has a role to play, in trying to bring about better feelings, not just between the leaders of management and labour unions, but in work-place relationships at all levels.

Indeed, strikes are bitter conflicts. Both sides attempt to demonise their opponents, which sometimes results in both sides claiming the other side has violated the law. Both sides are right to pursue their own self-interest in accordance with the law.

Indeed, the bosses face loss of profits and customers and, potentially, long-term damage to the business. Equally, the workers faced loss of wages and possible loss of their jobs if the company went bankrupt. Most of the time, the customers suffer, depending on the type of strike. For example, if it is a municipal strike, garbage would pile up and flies invade streets and houses.

Strikes are an exercise of monopoly power. Their deadliest enemy is competition and they are best able to flourish where monopolies survive. But decent treatment should not be at the price of risking the lives and comfort of the public.

When workers in a public monopoly go on strike, the only victims are the customers and the taxpayer. Indeed, in some cases making the customer suffer has become the primary tactic of the modern strike leader. Worse, in many cases they provide vital public services that it can be dangerous to withhold.

That is why the labour law does not allow soldiers or policemen to strike. It is why many countries restrict the right to strike across a whole range of tasks, the interruption of which would endanger the life, personal safety, health, or normal living conditions of people.
So can we find a better way to resolve industrial disputes that does not involve making economic hostages of the public? Can we do this without undermining the rights of responsible trade unions?

It is undoubtedly possible for a government to remove the right to strike from a limited number of areas where irresponsible action would unfairly oppress or put the public at risk. It is more difficult to do it in a way that respects the rights of employees and encourages sensible negotiating practice and good industrial relations. But it is not impossible.

During every strike, management and labour go into contentious labour negotiations with an attitude of "We'll show them”. The artful resolution of any dispute, including labour contract., allows both sides to walk away proclaiming victory, avoids messy questions about who blinked first and permits everyone to bask in the glow of - dare we use such an odious phrase? - A win-win.

But it's just as possible for a settlement to contain a few victories, some short-term gains and long-term losses, some outright defeats and a lot of draws, stalemates and inconclusive results, sometimes all of the above on the same issue. That's a win, isn't it?
Well, yes and no, sort of, and it depends and maybe not. Perhaps the company didn’t get everything on its wish list in this round, but some might look at what it did get and conclude that the camel, having previously wriggled his nose into the tent, now has his entire head inside and is looking around for space to fit in more body parts next time.
So how can South African companies resolve strikes quickly without loss of income, violence and acrimony.

To resolve strikes, management and unions need the art of conflict resolution and should consider the following guidelines for peaceful conflict resolution nicely captured by American educator and author Robert E. Valett: respect the right to disagree, express your real concerns, share common goals and interests, open yourself to different points of view; listen carefully to all proposals; understand the major issues involved, think about probable consequences; imagine several possible alternative solutions, offer some reasonable compromises, and negotiate mutually fair cooperative agreements. Instead of pressuring, shouting, or manipulating, use good business skills.

Management and labour unions must try to put emotions aside and use intellect to work together fairly and cooperatively. In other words, use the art of negotiation to work out your differences.

Suffice to say that, in the art of negotiation, there are general, fundamental rules to observe as in normal negotiations. The golden rule is consensus building. The negotiators need to strike a rapport with the other person. There must be general conducive atmosphere for striking a compromise. Each party should not adhere strictly to hard positions. There must be an atmosphere of willingness to give-and- take and strike a win-win bargain. Both parties need to concede.

Good negotiation tactics include a willingness to listen to the other person's viewpoints and be extremely patient. All parties must lay all their cards on the table, above board. Bad negotiation tactics happens when each party tries to hide information for hidden agendas. Sooner or later when found out, the other person loses every ounce of credibility and credentials and negotiations breaks down. Bad negotiation tactics simply mean impatience and insincerity, cheats and greed!

Management and trade union leaders should not forget that skills training improves knowledge and negotiation skills in solving strikes. Training contribute to building healthier labour relations in business, an important factor for a stable investment environment.

When businesses and workers understand labour policies, differences in labour relations and strikes are minimised.

However, if the art of negotiations and conflict resolution fail, compulsory arbitration seems the obvious answer. Unfortunately, since most arbitrators 'split the difference' between the two sides, it encourages both sides to make outrageous claims.

The best approach is the one used by several states in the United States. Disputes are resolved by what is known as “Pendulum Arbitration”.

The basis of the Pendulum agreement worked as follows: Firstly a trade union is offered a pay rise, say 4%. Management explains why, providing in-depth analysis of their position in terms of profitability, inflation, product research and development, capital expenditure and the general outlook of the company.

The union then has two weeks to accept the offer. If not it has to put in its own claim. The company then has two weeks to either accept the union's claim. If agreement cannot be reached both sides sit down for a further two weeks to try and get an agreed settlement.
If a deal could not be reached then the most important point of the Pendulum deal is an umpire (not an arbitrator) is appointed. His or her brief is to back only one of the offers - having carefully considered the positions of both sides.

There is halfway house. The net effect is that both sides had to be realistic with offer and claims. In a period of 30 years only once has a state failed to reach agreement and we had to call in an umpire.

The Pendulum System in effect created a non-strike agreement, which is in the interest of all. If our country had such a system I am convinced that unions would not make any outrageous claims as the umpire would go with the company.

To ensure that in the next decade we don't further entrench the strike-threatening mentality, unions and management must encourage conflict resolution, negotiation skills and maybe the introduction of the Pendulum System.

Thankfully, most employers and employees have an excellent working relationship with unions as they all recognise they are operating in an era of fierce global competition.

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