Given the current state of the economy, many employers will be seeking concessions, such as reduced wages or more restrictive benefits, in upcoming union negotiations. Anyone who has been involved in union negotiations understands that the collective bargaining process is a matter of give-and-take. This means that a company must be willing to make concessions in order to obtain concessions in return. It sounds simple; however, the process is easier said than done. Here are a few suggestions to maximize your likelihood of success in bargaining concessions.
First, legitimize your initial offer or demand (i.e., articulate the business justifications) when you present it at the bargaining table and don’t move away from your initial position too easily. A willingness to move off of your original offer or demand too quickly may not be viewed by the union as a concession on your part, or it may send the unintended signal that the proffered justification is not well-founded. The union will view an eventual change in your position as more meaningful if you have established your original offer or demand as both reasonable and serious by keeping it on the table.
Second, make concessions in “installments.” Union negotiators expect to trade offers back and forth, with each side making concessions before reaching a tentative agreement on an issue. Sometimes companies want to bypass this time-honored ritual and begin negotiations on an issue by submitting a proposal that is close to their best offer or by going directly to the bottom line. However, the reality is that if you begin with your “best offer” or you concede too much too soon, the union will suspect that you are holding something back, even though you are not. This miscommunication may prove difficult to correct. In contrast, installment concessions are risk-free. They send a signal to the union that you are willing to be flexible. Moreover, the union may agree to your less-than-final offer, possibly leaving room for a company concession on another issue important to the union, if necessary.
Third, clearly communicate two points to the union about a proposed concession: the concession is costly to you, and it is beneficial to the union. For example, calculate the cost to the company of a low-wage offer and then contrast it with other (hopefully lower) wage offers agreed to at similar or competing companies; or, identify the number of bargaining unit jobs that would have to be eliminated to reduce costs to a level deemed necessary by the company, but which would be saved if the union accepts a lower-wage offer that satisfies the company’s cost reduction goal. Remember, you must not only persuade the union negotiation team of the merits of your proposal, you must also provide the union with information that it can later use to influence the bargaining unit to accept your concessionary proposal.