By: Hugh Secord, B.A., M.B.A., CHRP

Recently, a spokesperson for a major employer was explaining how, during bargaining, the organization had tabled its offer, and that union had taken the offer to its members for a ratification vote and strike vote. While the previous contract had not yet expired and the strike deadline was several weeks off, the spokesperson explained how this action was the norm. The company fully expected the employees to turn down the offer and to give the union a strike mandate. They subsequently did exactly that.

The company and likely the union as well see this as part of their particular negotiating ritual.
Across many different organizations we see many different rituals. For example, in one organization, the parties have a history of consistently concluding bargaining early. In another, the parties consistently do not begin bargaining until the expiry date of the previous agreement has actually passed.

What is interesting about these negotiating rituals is how ingrained they have become in the culture of the organization. They are even more strongly entrenched as part of the bargaining subculture, and are rarely, if ever, questioned, with the attitude being. That's the way we've always done it!.

Rituals Are Important
Rituals in bargaining are important. They are a means of communicating, even though the messages seem to be consistently the same. In the first example above, the company knows that, regardless of what it offers the first time, it will be turned down, and the union will return with a strike mandate. However, it can use the first offer to send a message as to which direction the company sees negotiations heading. The union can test the offer to determine where the most salient points are for further negotiations. This then serves as a mechanism for establishing points of convergence which presumably might make further bargaining more efficient.

As much as rituals create predictable behaviour, predictability is usually good. However, in collective bargaining, some rituals are established only through tacit consensus and not necessarily through any deliberate attempt to create efficiency. Many of the rituals are not as beneficial as the parties might believe. In one bargaining unit, it became known amongst the several different employers who dealt with the particular business agent, that he liked to take many different offers back to the membership for ratification before finally seeking approval. The companies knew that it typically took three ratification votes (and occasionally four) before a settlement could be reached. Oddly, no one remembered that bargaining unit ever going on strike. They simply kept voting until they got an offer they liked.

In this case, bargaining was inefficient because the business agent was able to abdicate responsibility for his system in favour of direct democracy. The result was inefficient and was extremely frustrating (I am happy to report that the business agent has since retired).

A very common ritual is for the union to call for a break in talks early in the bargaining process and to apply for conciliation. The union then holds a strike vote. Armed with a strike mandate and a deadline, the union returns to the bargaining table. This simultaneously puts more pressure on both parties and helps speed up the process. By doing so, the union can force its constituents to drop issues quickly and get down to the salient points. It also forces the employer to declare what is truly important on its agenda.

Of course, the problem with predictable rituals is that they become too predictable and lose the inherent effect that was intended. An application for conciliation could signal that the other party is closing in on its final position. However, if the ritual is an early application, it signals nothing.

We can become so used to ritualistic behaviour that we become enslaved to the process and find it difficult to introduce any changes to the established patterns. While this usually translates into agreements that are reached without disruption, it does not necessarily mean that those agreements are themselves efficient. The process can be efficient in that few resources are used to bargain a new agreement, and there are no work disruptions, yet still result in an inefficient agreement where the contract terms do not serve the mutual objectives of the parties well.

In the case where the parties pride themselves on early resolutions to bargaining the contracts, there are drawbacks that strain the competitiveness of the enterprise. In expedited proceedings that march to a deadline, there is a definite propensity to defer issues that require extensive dialogue to <q>the next round</q>. However, even when this inefficiency is noted, the parties may find it difficult to change the rituals. In fact, consistent with the religious analogy, it may be seen as pure heresy to question the existence of these rituals.

Expert Negotiators
I believe that the true expert negotiator is by nature a heretic. There is considerable strategic advantage to disrupting the comfort zone of the other party and creating a level of uncertainty with respect to your bargaining strategy. It has to be done with some finesse or the disruption will be seen as nothing short of a declaration of war. However, done effectively, disrupting the other party's bargaining orientation will provide you with significant bargaining leverage.

How does one disrupt the other party's ritual? Do the unexpected. In the case of the union that routinely turns down the first offer, the employer should not make a comprehensive offer until it has reached the expiry date. Keep the dialogue going on a clause-by-clause basis. It should not submit a complete offer, but table positions on each issue separately. Make the acceptance of one proposal contingent on the resolution of another.

In the case of the agent who used direct democracy as a bargaining vehicle, one company simply tabled its final offer. It was as per the ritual offer being turned down, but then the company dug its heels in and refused to change its offer. It went to a second vote, which was also turned down (by a narrower margin). The third time, with no changes from the first offer, the agreement was struck. In the next round of bargaining, that company faced a bargaining committee that actually wanted a dialogue on the issues, and it stood out from the other companies for having broken the pattern (and ultimately the business agent).

Companies rarely are the first to apply for conciliation. However, doing so can disrupt the ritual even if there is actually no material change to the process. It simply sends a message that is different, forcing the union to interpret the company's intent differently. The same thing applies when a union refrains from applying early to disrupt the company's predictable reaction, or to simply send a different message.

Forcing Change
Disrupting patterns of behaviour forces change. The actual strategy has to be thought out to determine the possible consequences. However, the advantage it provides can be significant. When one party always behaves in the same way, the other party can predict what its next move will be. Strategic advantage is lost if I know that when I turn left, you will turn right, allowing me to easily determine my next move. If I do not know what you will do, when I turn left, I am at a disadvantage.

Bargaining rituals are good; in fact, they are necessary. However, as with any good thing, we need to disrupt the patterns, every once in a while, to keep everyone honest.

Hugh Secord has established a practice as a mediator/arbitrator in labour relations and employment law matters. Hugh has over 25 years' experience in Human Resources Management and Labour Relations. His background includes senior-level positions in manufacturing, pulp and paper, and logistics. He also holds a B.A. (Sociology/Economics) from the University of Toronto, an M.B.A. (Finance) from York University and received his CHRP designation in 1997. Hugh can be reached at hughsecord@sympatico.ca.

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