Dear Friends, Could you list out the Do’s and Dont’s while carrying out wage negotiations with labour unions? Atul Joshi
From India, Jammu
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8From India, Jammu
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Understanding Wage Negotiations
Periodic wage revision is a fact of the industry. There is no law that compels you to do it! This is an inevitable part of "collective bargaining"! Bargaining touches upon every moment and aspect of ordinary life. Wage determination, aside from other theories of wages and as decided upon by the Hon. Supreme Court in its judgment many years ago, in a case popularly known as the "Unichem" case, has established two fundamental aspects: "Industry-cum-region practice" and "capacity of the industry to bear an additional burden." This is based on the fact that when dealing with matters connected to the industry, one must remember that it is an economic organization, and the limit to spend on any item/issue (including claims of all stakeholders) is determined by the surplus it generates.
Since it is not possible to accurately decide labor's contribution to prosperity/surplus generation and as sanctified by industrial democracy, labor is also one of the important stakeholders.
While from labor's point of view, the revision of wages is the way to meet rising costs of living and improving the standard of living, it is necessary; the fact remains they represent the primary factor in generating/adding value to the organization like other factors.
Matters to Consider During Wage Negotiations
1. Management and labor (in matters of organizational survival and growth) are just two factors. The organization is the supreme entity. Both factors are subordinate to the organizational interests, and unless the organization can "afford" additional costs arising out of wages, its survival/growth is difficult!
2. Always operate on the principle, "quid-pro-quo" (something in return!)
3. Do not contract out of the law!
4. Use negotiations as an opportunity to strengthen the organization by, for example, negotiating for the elimination of wasteful practices that always creep into the system over a period of time!
5. If possible, try to build "performance-linked rise" through enhanced productivity, rejection control, etc.
6. If possible, bring in "multi-craft proficiencies" into your work culture!
7. Encourage "conditional payments" like attendance promotion incentives and incentives for defined target achievement if that is possible in your system!
For the time being, I suppose this response is adequate. If you desire more inputs, kindly respond with specific queries!
Incidentally, are you likely to actually enter a real-life wage negotiation situation, or was that just an academic curiosity? Whatever it is, I suppose your query is answered!
Cheers!
Regards,
Samvedan
From India, Pune
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Periodic wage revision is a fact of the industry. There is no law that compels you to do it! This is an inevitable part of "collective bargaining"! Bargaining touches upon every moment and aspect of ordinary life. Wage determination, aside from other theories of wages and as decided upon by the Hon. Supreme Court in its judgment many years ago, in a case popularly known as the "Unichem" case, has established two fundamental aspects: "Industry-cum-region practice" and "capacity of the industry to bear an additional burden." This is based on the fact that when dealing with matters connected to the industry, one must remember that it is an economic organization, and the limit to spend on any item/issue (including claims of all stakeholders) is determined by the surplus it generates.
Since it is not possible to accurately decide labor's contribution to prosperity/surplus generation and as sanctified by industrial democracy, labor is also one of the important stakeholders.
While from labor's point of view, the revision of wages is the way to meet rising costs of living and improving the standard of living, it is necessary; the fact remains they represent the primary factor in generating/adding value to the organization like other factors.
Matters to Consider During Wage Negotiations
1. Management and labor (in matters of organizational survival and growth) are just two factors. The organization is the supreme entity. Both factors are subordinate to the organizational interests, and unless the organization can "afford" additional costs arising out of wages, its survival/growth is difficult!
2. Always operate on the principle, "quid-pro-quo" (something in return!)
3. Do not contract out of the law!
4. Use negotiations as an opportunity to strengthen the organization by, for example, negotiating for the elimination of wasteful practices that always creep into the system over a period of time!
5. If possible, try to build "performance-linked rise" through enhanced productivity, rejection control, etc.
6. If possible, bring in "multi-craft proficiencies" into your work culture!
7. Encourage "conditional payments" like attendance promotion incentives and incentives for defined target achievement if that is possible in your system!
For the time being, I suppose this response is adequate. If you desire more inputs, kindly respond with specific queries!
Incidentally, are you likely to actually enter a real-life wage negotiation situation, or was that just an academic curiosity? Whatever it is, I suppose your query is answered!
Cheers!
Regards,
Samvedan
From India, Pune
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Thank you for the valuable advice. It was exhaustive indeed. Yes, I shall be conducting the wage negotiations at the end of the year. I shall get back to you with specifics when I have any.
Thank you,
Atul
From India, Jammu
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Thank you,
Atul
From India, Jammu
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In wage negotiations with the union, it is crucial to understand the challenges faced by the workmen. Sensitivity to the issues involved is key. It is not solely about money, although that is an expectation. Handling non-monetary grievances can also lead to significant satisfaction among the workers. The company's culture plays a vital role in this process. It is essential to analyze the wages offered by similar companies in your area that are comparable in size and product to make informed decisions.
Thank you.
Regards
From India, Pune
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Thank you.
Regards
From India, Pune
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