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Unformatted text preview: Chapter 8: The Negotiation Process and Strikes Contract negotiations provide labor management with a predetermined time to set or revise the terms of the agreement governing their relationship o Focus/clarify how each party feels about critical issues and the need to either alter or preserve certain practices Richard Walton and Robert McKersie developed a negotiation framework to compare and contrast two approaches of negotiation The Four Subprocesses of negotiations Distributive Bargaining o Ones sides gain is the other sides loss o Win-lose or zero-sum bargaining o What labor gains management gives up Wage rates and fringe benefits Labor gains more income from a higher wage Workers lose when a fringe benefit (paid vaca time) is reduced o Leads to conflict across bargaining o Union threatens to strike to convince management to agree to demands o Management threatens union with the loss of income o Components of bargaining power, strike leverage, and elasticity of demand for labor are critical determinants of how distributive conflicts are resolved Integrative Bargaining o Solution provides gains to both management and labor win-win bargaining o If productivity of firm increases, the ees can benefit in form of high compensation/shorter work hours o Labor and management can improve firm performance by addresses poor practices and changing job classifications or seniority rules o Introduction of new technology leads to integrative gains...
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- Fall '06