PowerPoint

Presentation for
Industrial Relations in
Canada
Fourth Edition

Adapted by

Bui Petersen
Memorial University of
Newfoundland
Chapter 7
COLLECTIVE BARGAINING

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Poll
Open the MindTap Mobile app and select your
course.
How does collective bargaining differ from individual
negotiations?
A. Individual negotiations get more emotional.
B. Individual negotiations need to consider other
stakeholders.
C. Collective bargaining involves an ongoing
relationship.
D. Collective bargaining is more efficient.

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Learning Objectives
After reading this chapter, you should be
able to
• explain the conflict-of-interest assumption
• identify the differences between individual
negotiations and collective bargaining
• describe the four subprocesses of collective
bargaining
• relate examples of distributive and integrative
bargaining issues Continued…

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Learning Objectives
(Continued)

• discuss the various scenarios of a collective

bargaining model and recognize the pressures on all
of the parties to collective bargaining
• describe bargaining step by step and identify the dos
and don’ts of bargaining
• explain how interest-based bargaining (IBB) is used
by management and labour, and recognize under
which conditions it is appropriate to use it

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CUPW Gives Notice of Rotating
Strikes in Toronto and the GTA
• Canadian Union of Postal Workers (CUPW) is continuing
rotating strikes while negotiations are ongoing.
• Canada Post highlights that they have offered significant
improvements to wages, job security, and benefits, without
asking for any concessions.
• Specific issues include workload, additional financial services,
and moving to one uniform for all delivery employees.

Continued…

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CUPW Gives Notice of Rotating
Strikes in Toronto & The GTA

Canada Post highlights

its commitment to
working together
constructively and
finding common
ground.

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Collective Bargaining vs.
Individual Negotiations
Collective Bargaining Individual Negotiations
Number of participants Multiple Two
• Often with different
interests and
pressures

Complexity High Low

• Although some • Normally reach a
issues are inherently compromise
adversarial, others decision
have potential for a
win–win solution.

Relationship Ongoing Can be one time only

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IR Today 7.1
Strategic Negotiations
• The principles of negotiations discussed in this
chapter have applications in many contexts.
• Managers are constantly negotiating with
customers, suppliers, regulators, and supervisors.
• For example, building trust and respect makes it
possible to use integrative bargaining in a range of
contexts.

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The Four
Subprocesses
DI ST RIBUTI VE BA RG A I NING
I N T EGRATIVE BA RG A I N ING
I N T RA -TEAM BA RG A I N ING
AT T I TUDI NAL ST R UC TU R ING

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Subprocesses of Bargaining
• Adversarial style
Distributive • Two parties compete over the
distribution of fixed resources.
Bargaining • Example: wages

• Cooperative approach
Integrative • Potential exists for a solution that
provides mutual gains.
Bargaining • Example: health and safety

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Examples of Issues Requiring
Different Bargaining Approaches

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Subprocesses of Bargaining
• Bargaining within the union or management
Intra-team team
• Example: Individual union team members
Bargaining may represent interests of a specific group,
like shift workers.

• The process of building mutual respect and

Attitudinal trust between the negotiating teams
Structuring • Necessary for enduring and positive
collective bargaining relationship

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Examples of Issues Requiring
Different Bargaining Approaches

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Strategies
and Tactics
D I S T R I B U T I V E BA RG A I N I N G
I N T EG R AT I V E BA RG A I N I N G
I N T R A - T EA M BA RG A I N I N G
B U I L D I N G T R U S T TA C T I C S

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Distributive Bargaining Tactics
• Zero-sum game
• Discussions start with inflated positions, leaving
room to reduce the ask or to make trade-offs later
in the process.
• Golden rule: ask for more than your bottom line.
• bottom line is minimum acceptable offer
• lower offer could result in strike or lockout
• Control over communication critical
• one spokesperson for each party

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Integrative Bargaining Tactics
• Positive-sum game
• Cooperation and sharing of information are key to
this process.
• Willingness to share information can be a test of
commitment to this joint problem-solving approach.

• Often, these issues are resolved through a joint-

committee structure.
• Many voices and an array of possible solutions
characterize this process.
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Intra-team Tactics (Union
Example)

Pension Plan
Wages Democratic Process
Job Security

Variety of Desired
Determination of
Changes to the
Priorities
CA

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Building Trust Tactics
• Trust can’t be achieved overnight.
• Parties who trust each other’s word will have a
higher chance of positive outcomes in collective
bargaining.

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A Collective Bargaining Model
• Model can be applied to monetary issues such as
wages and benefits
• Contract zone: exists if each side’s bottom line
overlaps
• 95% of the time, parties able to negotiate a
settlement

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A Collective Bargaining Model

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Parties Have the Same
Expectations

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Parties Have Divergent
Expectations

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New Relationship or
Negotiators
• More likely to have unrealistic expectations about
what a strike may produce
• Use of conciliation and mediation may help
parties modify their expectations so agreement
can be reached
• Most jurisdictions in Canada have legislated
arbitration in special circumstance of first
contract negotiations

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Changing Economic
Conditions
• Rapid changes in either the economy or conditions
for the organization can result in difficulties
reaching an agreement.
• Third-party intervention may help to reduce
unrealistic expectations.

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The Triangle of Pressures
• A deadline may be necessary to pressure the
parties into a settlement.

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Sources of Pressure
• Union–employer pressures:
• Pressures on the firm—potential for a strike
• Pressures on the union—economic impact of strike or
lockout on membership
• Pressures on union members—loss of income during
strike or lockout
• Employer–union member/employee pressures
• Union–union member pressures

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 Bargaining Step by Step

Parties
Preparation for Serve notice to
Parties meet communicate
bargaining bargain.
priorities

Momentum
Settlement or Contract zone
Ratification builds for a
impasse? is reached.
settlement.

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Dos and Don’ts of
Bargaining

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What Should Be Discussed
First?
Should the monetary issues be negotiated
first?
• Problems with starting with the tough issues first
• It could result in a premature impasse.
• The parties don’t fully understand each other’s positions.
• They are not prepared to compromise.
• It could result in increased difficulty negotiating non-
monetary issues.

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Interest-Based
Bargaining (IBB)
W HAT I S I T ?
I BB ST E PS
W HY I S I BB S O DI F F I CU LT TO ACHI E V E?

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IBB Explained
• A cooperative form of bargaining
• Parties focus more on interests of the parties and
not exaggerated positions
• Win–win or mutual gains negotiations

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Example of IBB

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IBB Steps

Systematically
compare
Search for alternatives.
alternative
Identify the solutions.
problem.

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 Key to IBB Success

Problem-
Open Needs and
discussion
solving
objectives
Trust Success
approach

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Why Is IBB So Difficult to
Achieve?
Mixed-Issue Bargaining:
Mixed-
Issue
Bargaining
• Some issues are inherently suited
to distributive bargaining (e.g.,
wages), while others are better
suited to integrative bargaining
(e.g., health and safety).
IBB Bargaining History:
Theory
Bargaining • A long history of adversarial
History
negotiations characterized by
conflict and lack of trust make IBB
difficult to achieve.

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Why Is IBB So Difficult to
Achieve?
Theory:
Mixed-
Issue
Bargaining
• Will the parties bargain in a
cooperative manner
throughout the negotiation?
• If one party switches to
distributive bargaining, they
IBB are likely to achieve a better
outcome at the expense of the
Theory
Bargaining
History
other party.

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When Does IBB Work?
• In a crisis
• “We’re in this together.”
• Example: UAW and Chrysler in 1980s
• In an exceptionally bad relationship
• Where monetary conflicts of interest do not exist

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IBB Research
• Highly distributive issues do not work in a mutual
gains approach.
• A high degree of lead negotiators are familiar with
and have used IBB.
• Union negotiators rate it lower than managers do.

Continued…

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IBB Research
(Concluded)
•On average, female and newer negotiators
give IBB a higher rating.
•Relatively new innovation
• experimental stage
• not fully accepted by either labour or
management

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Summary
• Key differences
• Distributive vs. integrative bargaining

• Intra-team bargaining
• Diversity of interests on each team

• Building trust is most difficult process

• Both sides face pressures in relationships.

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End-of-Chapter Questions and
Activities
Use the discussion questions and end of chapter
activities to solidify your understanding of
• bargaining theory
• the differences between individual and collective
bargaining
• the four subprocesses of bargaining
• the principles of interest-based bargaining (IBB)

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