How Corporate America can deal with EFCA

The EFCA will do away with secret ballot elections, which have historically occurred with less
coercion or intimidation from either management or unions.

Friday, April 10, 2009

Congress is intent on passing the proposed Employee Free Choice Act (EFCA), which the president said he will sign into law. The EFCA will permit union organizers to pressure workers into signing cards or providing other valid authorizations indicating that they want to be represented by a union. If a majority of any company's employees in an appropriate unit sign such cards or authorizations, then workers will, ipso facto, be represented by a union. The EFCA will do away with secret ballot elections, which have historically occurred with less coercion or intimidation from either management or unions. Under the EFCA, however, union organizers will have a greater opportunity to coerce, pressure, and intimidate workers into signing cards, and management will likely have little or no recourse, or opportunity to present its case, as in the past. The result, of course, will be a significant increase in unionized workers, thus raising production costs during a period of recession. Such a result portends even worsening economic problems. In order for Corporate America to avoid such a scenario, it is essential that management and
workers throughout the country obviate their historical adversarial relationship. If a more productive relationship does not come into being, then Corporate America will be burdened by millions of newly unionized workers. To stem the potential tsunami of dramatically increased unionization, it is essential that management understand the feelings, thoughts, and proclivities of its workers, especially in relation to what unionization could mean to them. It is essential that management execute a proactive strategy that will reduce and perhaps eliminate the need for employees to join a union. I have developed the following union free strategic action plan for numerous of my clients, and they have found it to be highly effective.

1. Facility Work Philosophy -- Communicate a statement of the facility work philosophy,
emphasizing organizational goals, objectives, and a commitment to positive employee relations. This sets the tone and direction for positive changes. For example, if a facility's primary commitment is to produce the most cost effective products in an extremely competitive marketplace, the commitment needs to be clearly stated in the employee work philosophy.

2. Employee Opinion Survey -- Conduct a confidential employee opinion survey to ascertain
employee attitudes toward job duties, working conditions, skills of supervisors and managers,
communications, pay, benefits, opportunities for advancement, personnel policies and procedures,
and job security. The survey serves a dual purpose. First, it provides employees with a direct and
anonymous channel of communication to top management. They know that they can communicate frankly with management without fear of reprisal. Second, it furnishes management with an accurate, continuing profile of employee attitudes on which to base policy decisions. For example, items dealing with communications might include "my supervisor asks for my opinion," or "management keeps us well informed about matters that affect us." Employees would then decide the degree to which they agree or disagree with the statement. Items asking for employees' written opinion or comments might include "the thing 1 like most about working here is..." or "some things our management should know are..." Feedback sessions regarding the results are necessary and encourage direct and positive dialogue with employees on critical issues. Once management has gained insight into issues that employees consider important, it can then respond and thus demonstrate that it is truly listening.

3. Employee Profile -- Develop a profile of the type of worker the facility should actively seek for
employment. An employee profile greatly increases the likelihood that a facility will hire applicants
who will be useful, efficient workers and reduces the chances of hiring persons who will be
disaffected and troublesome. The development of an employee profile begins with a thorough
analysis of the employer's current work force. The work force analysis must determine the precise
skills required at the facility and examine the attitudes employees must possess to foster a positive work environment. In addition, it will be necessary to analyze the labor market to measure the availability of desirable employees.

4. Employee Selection System - Once the profile has been developed, management will be in a
position to prepare an employee selection system. The selection system will ensure that the facility hires only applicants who have the right combination of skills and attitudes for the particular work environment. As part of the selection system, management should develop questions and model answers to help employment interviewers determine whether an applicant possesses the desired profile characteristics.

5. Audits must be developed. Audits require supervisors to respond to a series of questions, it
compels them to become more aware of the employees whom they supervise and to take an interest in them. Additionally, audits ask supervisors to provide what they believe is the employees' view of working conditions as well as their needs, desires, concerns and issues. It is important to remember that supervisors themselves are sometimes only recently removed from being hourly employees and are likely to have a good perspective on the hourly work force. Personnel audits serve as a barometer for determining how well the employees are adapting to the pro-employee method of operation. The audit might include the following questions:

  • Does the employee lack motivation?
  • Does the employee frequently complain about the job, salary, or supervisors' treatment?
  • Is the employee openly disrespectful of authority?
  • How often and how recently has disciplinary action been taken against the employee?
  • Does the employee perform work duties inefficiently?

6. Involvement Systems -- Institute systems that encourage employee involvement in the decision making process. Employees will understand and are more likely to support decisions in which they
play a role. Employees who see themselves as a genuine part of the facility, rather than just cogs in a wheel, will be more productive, efficient, caring, and loyal. Informal involvement systems might include meetings with small groups of workers to listen to employees' needs and perceptions, while encouraging them to suggest positive workplace solutions. Formal involvement systems include the use of such techniques as quality circles, focus groups, and/or employee membership on committees dealing with work rules, safety, discipline, and so forth. The important point is that management must listen to what is on the minds of employees and encourage them to provide solutions that will have a positive impact; it will further serve to demonstrate that management cares about employees and their jobs.

Summary

Management will be facing a crucial employee challenge when the Employee Free Choice Act is
passed. That challenge is to create a work environment in which employees and employers
recognize that their interests are the same and that their goals can best be achieved through mutual cooperation. By implementing an integrated union-free strategy, the prudent employer can meet that challenge and diminish the likelihood that workers will be swayed by organizers into signing cards or other authorizations for union representation.

Stephen J. Cabot, Chairman of the Cabot Institute for Labor Relations (www.cabotinstitute.com), is a nationally renowned labor relations expert and strategist. He is also the author of the best-selling books, Everybody Wins! Up From Confrontation, and Stephen Cabot's Complete Guide to Labor Relations in the 21st Century.

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New Unionizing Troubles

The first half of 1994 saw more than 3,000 strikes and 2,405 union representation petitions -- dramatic evidence of the new union activism that we first warned of in the July 15. 1993 issue of Boardroom, and then expanded on in the March 1, 1994 issue.

The unions are now using an increasing number of young, well-educated minority organizers who are prepared to assist workers in all aspects of life, nor just workplace issues.

Whether your company is union-free...facing an organizing attempt...or trying to deal with a union that is already in place, it's important to recognize that the increasing level of employee frustration and insecurity today is creating a very real threat to efficiency and workplace morale. Latest challenges for business:

  • The National Labor Relations

    Board under the Clinton administration, is now more supportive of union/employee rights than has been the case for the past 12 years under Reagan and Bush.

  • There have even been recent cases of unions pushing for recognition without an election. Thiswas a popular tactic before Reagan replaced the air traffic controllers...and it is now reemerging.

    WHAT TO DO

  • Prepare now to head off union activity. If there is a sudden push for elections you won't have much time to correct the company's image in the eyes of employees. Start by trying to understand the real frustration felt by workers. There are problems, of course, with workers who have seen many of their peers laid off in down-sizing and restructuring efforts. Those efforts are still in progress in many US companies.

  • Take the initiative. Don't wait for an outbreak of trouble. Take an aggressive stance now toward more effective and timely communications with employees.

  • Bring in outside lawyers or consultants to train the company's employees in better communications and to help them solve real-life problems.

  • Example: We are now working with companies to educate employees on how to deal with issues of violence.

  • Use new tools, such as Alternate Dispute Resolution (ADR), to remove the contention that can arise between bosses and subordinates.

  • Set up a complaint resolution system with an appeals process. This can be done either inside the company, where there might be a provision for peer review and/or a hearing by the CEO, or outside the company, using impartial arbitration and mediation services such as the American Arbitration Association or the Federal Mediation and Conciliation Service. There also are a number of private mediation services.

    Important: Make it clear whether these services have only mediation powers -- or final decision powers. A landmark Supreme Court case (Gilmer vs. Interstate/Johnson Corp., 111SC 1647, 1991) has established that an ADR providing for binding arbitration of an employer/employee dispute was final and could even preclude the employee from bringing other court actions if the employee had previously agreed, in writing, to be bound by the decision.

    TEAMS CAN BE TRICKY

    Many companies are having success using work teams of various kinds to improve quality and productivity.

    These can be particularly effective in nonunion companies to reduce the incentive to organize. Even in unionized companies they are fine, as long as they avoid getting into questions of hours, wages or working conditions -- legally the province of unions. In some companies, there is a union representa-tive on every team who can convey such problems back to the union for resolution.

    Recognize that there is a lot more ag-gravation in the workplace than ever be-fore, and be sure that teams are per-ceived as parts of the same wheel. You want the employees to feel that a team is their team, not just the company's team. This may require special education to bridge various aspects of the company's labor program, such as team-building, training or suggestion awards, and ex-plain how they relate to each other.

    In all cases be sure to assign accountability and responsibility, along with time frames for completion. Ask for feedback from employees to get reinforcement and commitment to team goals. Make use of employee surveys to find out how sentiment is running.

    UNDERSTAND THE UNION

    It is official policy at the AFL-CIO today to give at least lip service to a more cooperative stance, to help US companies become more globally competitive.

    In reality, much depends on the local union leaders, many of whom still espouse the adversarial thinking of the 1930s and the 1960s. Some-times these local officials -- who want to be reelected (just like members of Congress) -- must adopt a more mili-tant stance in response to their frus-trated constituency.

    Defensive strategy: As with any re-lationship, it is useful to develop an ongoing dialogue with the union. Both parties need to be openly involved in the process for mutual advantage. This doesn't mean management must invite the union into the boardroom, but the company should make a com-mitment to provide enough information to the union so that it can educate and control its members.

    Aim: To build respect and credibility between the two sides. Be prepared to be challenged on what you do, if it turns out to be different from what you say.

    Important: The two sides don't always have to agree. You can agree to disagree, preferably without being disagreeable, handling disputes in as po-litely a way as possible.

    Example: Making off-the-record con-versations public after a negotiation is a good way to kill off any trust that has been built in the relationship.

    Bottom line: Be reasonable and willing to listen, but never turn over the reins to the union. Do what you have to do to run the business.

    Important: Come up with a plan as to how you could continue to operate the business during a strike.

    Don't turn down union demands without due consideration. Wherever possible, try to seek acceptable middle ground. But when you have to say no-out of conviction that you are doing what is right for the long-term interests of the company and its em-ployees-stand tall and do it.

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  • How to Screen Out Troublemaking Employees...Legally

    Far too many companies shoot from the hip when hiring people, figuring they can always get rid of them in a month or two if they don't work out. That's a recipe for trouble, thanks to the vast number of legal weapons that employees can now wield.

    It always makes more sense to screen job candidates carefully... and hire only those who will fit in well. With the right screening techniques, this can be done.

    Start by establishing a company philosophy. That might sound corny, but it helps. Whatever the company's goals may be, refine them, describe them and put them into a document that can be given to prospective employees. That document tells job applicants about the company's attitudes.

    DISCOVERING ATTITUDES

    Find out about candidates' attitudes. The applicable questions are perfectly legal as long as they dovetail with the company's business-related philosophy statement and as long as all interviewers ask all applicants the same questions. All applicants should also be evaluated according to the same standards.

    Effective questions for rooting out potential troublemakers:

    • If we were to call your former employers, what would they tell us about you?
    • Do you think you should be able to criticize management?
    • How do you react to rumors on the job?

    QUALITIES TO LOOK FOR

    What you're looking for in the answers to all of these questions are honesty, openness and respect for the chain of command. Employees who have nothing to hide, for example, will urge the interviewer to call their former employers. They're confident that the report will be good.

    If there's an awkward pause, or if the candidate hems and haws, I often a sign that there's something he or she doesn't want your company to find out. In that case the answer usually goes something like this: Oh, I think they 'II give me a pretty good report...well, I really didn't get along too well with my immediate boss.

    An applicant who gives an unequivocal no to the question about criticizing management usually isn't being honest. The kind of answer to look for: Not in every instance; But when management is doing something that I believe is dangerous or unfair, I feel that I should be allowed the opportunity of talking with management about the situation.

    For better or worse, the grapevine is one of the most effective communications channels in any company. Here again, the applicant who claims not to pay any attention to rumors isn't being honest. Because many rumors involve guesswork about what management is up to, this question is a cross-check on the previous one about criticizing management, Best answer: Rumors can be upsetting, and if a rumor would impact my job, I'd like to feel that I could pursue it with management.

    To probe further, ask: How would you discuss such a rumor with management? The best answer would be something indicating respect for authority and a desire to work through channels. If satisfaction isn't obtained at the first level in the chain of command, the employee would go to the next level. Time and time again, employees who give these answers are the least likely to cause trouble later.

    AVOIDING LAWSUITS

    The two things that most often trigger equal employment lawsuits are questions that aren't work related or that differ from candidate to candidate. Attitudinal questions that dovetail with the company's philosophy statement, however, are (or should be) clearly work related. And when every applicant is interviewed and evaluated according to the same standards, no one can claim discrimination. The key here is that the system establishes an even-handed measuring rod -- it doesn't mix apples and oranges.

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    Cooperating Will Bring Better Job Protection

    American workers have always sought better wages and job security. Years ago they were just "employees-at-will," subject to the whims of their employers. They toiled in difficult working conditions and feared the day when their employers might fire them.

    Workers eventually turned to unions for job security and improved conditions. Bolstered by the National Labor Relations Act, which prevented discriminations against employees because of union activity, unions became the bargaining agents for millions of workers. By the end of the World War II, it looked as if we would become a nation of unionized employees.

    But the promises of unionism were never fulfilled. In the name of job security, unions compelled employers 10 accept inflexible, unproductive work rules. Unions spoke angrily and carried a big "strike" stick. They drove employers to pay ever-higher wages and contributed to an adversarial management-labor relationship, but did not assist in improving productivity. Unions gradually became anachronistic institutions, preaching the same 1930s message while the nature of work and the work force changed. Unions came to be perceived as self-serving institutions tainted by criminal indictments and prosecutions.

    Unions also became less relevant as an increasing number of state and federal laws were enacted to protect workers. Various laws now regulate minimum wages, overtime, pension plans, workplace safety, Social Security and the like. Many of these regulations contain provisions making it unlawful for employers to terminate employees who report violations.

    While these laws made work safer and more secure, state court decisions have built a new bulwark around individual employees over the last 15 years. These courts have further limited the "at-will" concept of employment by allowing terminated employees to file suits against their former employers for "wrongful discharge."

    Some employees have succeeded in these lawsuits by alleging that employees violated public policy because they fired them for serving on a jury, taking time off to vote, or "blowing the whistle" on a health violation. Many courts also have recognized implied contractual theories of wrongful discharge. In such cases employers were found to have made and subsequently broken binding, or oral "promises" of employment. Still, wrongful discharge actions, since they are undertaken by individuals, can give only the most limited job security to the masses of working people.

    Indeed, neither union bullying, statutes nor state court actions will provide American workers the job security for which we all struggle. Such security will be achieved only after both employers and employees deal successfully with two of the most vital economic issues of our times: international competition and productivity.

    We all know that international competition has put American industry on the spot. Our nation is swamped with imports in almost every field of production. Japan of our fiercest competitors, producing top quality products, while paying its employs lower wages than comparable American workers receive. Yet labor relations in Japan are excellent compared with those in America. Japanese workers have a high degree of company loyalty, and Japanese management regards its obligations to them as a top priority.

    It is the very need to compete with Japan and other productive, energetic nations that ultimately will force American industry to protect employees and provide better job security. American industry will become a competitive leader in the international marketplace only when it builds cooperative partnerships of labor, supervisors and management. Employers who see the "writing on the wall" will realize that they have to treat their employees fairly and work with them to harness their energies to meet the competition.

    American managers must re-examine their methods. Management must communicate effectively with employees, encourage suggestions and participation, adequately train supervisor in international relations and introduce problem-solving mechanisms in which employees have confidence. Under such circumstances, employees would find that their employers are eager to solve problems in the workplace.

    The American-managed Nissan plant in Smyrna, Tenn., is an example of a company that has built a working partnership of labor and management. The company trains its workers to do a number of jobs, involves them in decisions and gives them responsibility for the quality of the product at every level. The Nissan employees have shown no interest in unionizing and labor relations are harmonious.

    The cooperative approach may have been born out of necessity, but it will be cooperation, rather than wrongful discharge actions, government regulations or union muscle, that will be the source of employee protections in the future.

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    Avoiding Debilitating Labor Problems

    As a labor relations attorney who has represented management, I have created numerous programs to help prevent labor problems. The perception is that such programs are difficult to create and sustain, but it is no more difficult in unionized than in non-unionized companies. In both, management must commit to proactive, preventive programs.

    Most companies have a business plan but do not have a corollary labor relations plan. To minimize labor problems, new leadership roles must be instituted to create dynamic workplace relationships. For example, too often management focuses on what it says, not on how it is said. If employees perceive management as intimidating, an adversarial relationship will develop.

    COMMUNICATION. Rather than directives, management should engage employees in ongoing dialogue, developing a process to find mutually agreed-upon solutions. Having been consulted, employees feel their opinions count.

    Management taking time daily to be visible and available helps establish a bond of respect. In addition, management can show its concern through such things as offering advice about retirement investments from a financial expert.

    There are seven positive employee perceptions that enhance relationships with management. Employees must perceive that:

    • There is effective communication between management and employees.
    • Company policies and practices meet workplace needs and satisfy individual needs.
    • They like where they work.
    • Everyone works to achieve shared goals.
    • Management honors its promises.
    • Wages and benefits are comparable for similar work in the area.
    • The company provides training for employees not just to do their jobs, but to do their jobs well and facilitate opportunities for advancement.

    Two-way communication also gives management an opportunity to discuss its concerns. If employees understand the burden that management faces in paying a portion of healthcare costs, they will understand how those costs affect wages and other benefits. Shared prior to contract negotiations, such information will more likely be believed. Shared at negotiation time, employees will doubt management's sincerity.

    Effective communication results in understanding efficiencies and how to increase productivity. With goals achieved, management can establish recognition programs.

    CONSENSUS. Employee surveys not only demonstrate that management is listening but also help build consensus. In most surveys, anywhere from 30% to 40% express negative feelings, including confusion about work assignments, frustration about working conditions, feeling oppressed by management, feeling that management does not listen, and feeling that management pays only lip service to individual concerns.

    To create the most efficient and productive work environment, management must listen to employees, demonstrate respect for concerns, brainstorm solutions, and make employees feel they are all in this together. A company wants employees not merely to agree with management, but to accept them. To do this, management must have a critical understanding of employees, requiring compromise, coalescence, and consensus.

    Without consensus, the prospect for an adversarial relationship always exists. Surveys detect discontent that can often be improved with cost-effective programs responding to employee concerns. Left to fester, discontent could ultimately fuel strikes, slowdowns, and unionization.

    The consensus that management can create is essential in making employees feel they are stakeholders. Consensus puts an end to the unnecessary paradigm of "Us vs. Them."

    TEAMWORK. With mutual understanding of how to create efficiencies and increase productivity, there can be a shared vision of how to increase success. Recognition helps make teamwork successful, so it's essential that management recognize employees, repeat it, and reinforce it.

    One client developed a strategy around those three "Its": recognition, repetition, and reinforcement. He then implemented an "employee of the month" program, posting a photo of the stellar employee on a wall. The client miscalculated, however, by not realizing that when one employee's picture was replaced with another, the first employee felt disappointed. I suggested a "Wall of Honor" for all honored employees. The program has worked, and the company remains non-union in a highly unionized industry.

    Another important element in creating successful teamwork is an Employee Advocate Representative (EAR) program, with a designated employee as the EAR. The purpose is to have a peer available to assist employees. In establishing this inexpensive program, management shows its commitment to addressing employee concerns.

    Being part of a team makes employees feel they are stakeholders with their economic wellbeing tied to company performance. Stakeholders are team players who enjoy increased profitability and accept responsibility for increased costs.

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