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CHAPTER ONE
INTRODUCTION TO THE STUDY
1.0 BACKGROUND
This Chapter will focus on introducing the subject of wage negotiat...
2
that the workers representatives in general and trade unions in particular, focus wholly on
worker needs with total disr...
3
sold at prevailing prices at that time, and no customers will accept a subsequent price
increase for the goods or servic...
4
ground for contestation and inevitably conflict. Absence of a quality database for
information is also another handicap ...
5
Collectively bargaining in Zimbabwe for most NECs is at the multi-employer level,
meaning that employers come together t...
6
even after the introduction of multi-currency in February 2009. Those that have failed to
break even closed shop renderi...
7
“Employer and worker representatives in the insurance industry have referred 2012
salary negotiations to arbitration aft...
8
Table 1.0 NEC Catering Wage Negotiation Deadlocks from 2007 to 2011
Period Involved Statutory Instrument Comments
Septem...
9
1.1 STATEMENT OF THE PROBLEM
The Government has left collective negotiation/bargaining for industries with
employment co...
10
1.3.1 PROPOSITION
Wage negotiation deadlocks are as a result of parties not negotiating in good faith.
1.4 SIGNIFICANCE...
11
1.5 SCOPE OF THE STUDY
The research was conducted at the National Employment Council for the Catering
Industry sited at...
12
1.7 RESEARCH OUTLINE
This study report is presented in five chapters. Chapter 1 is the Introduction to the
research, Ch...
13
CHAPTER TWO
LITERATURE REVIEW
2.0 INTRODUCTION
This chapter presents a review of related literature. The chapter begins...
14
Alvarez and Kennedy (2006) put it more interestingly by saying that negotiation is the art
of letting them have your wa...
15
2.1.3.0 PRINCIPLED NEGOTIATION PROCESS- REQUIREMENTS
Once you have established the necessary condition for negotiations...
16
value to the other side, Fisher and Ury (1991) emphasize such things as acting
inconsistently with expectations.
 Emot...
17
2.1.3.3 OPTIONS: GENERATE SEVERAL OPTIONS BEFORE DECIDING
WHAT TO DO
Afredson et al., (2008) point out that once partie...
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2.1.3.5 CRITERIA/LEGITIMACY
When bargaining over positions, negotiators create a situation in which one side must
conce...
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2.1.3.7 COMMUNICATION
Negotiation is only possible through communication. Fisher and Ury (1991), maintain
that the feel...
20
other side’s position as possible, while revealing as little as possible about one’s own. It is
important that you shou...
21
that even with principled negotiation and trust, future doubt or suspicion can be avoided
by including in the agreement...
22
and practitioners from various disciplines have developed and utilized a variety of
approaches or levels of analysis to...
23
2.3.1 STRUCTURAL APPROACH
These consider negotiated outcomes to be a function of the characteristics or structural
feat...
24
have roots in mathematics, decision theory and rationale choice theory and also benefit
from major contributions from t...
25
rational player will choose defection every time because he realizes that by choosing to
defect he will fare better in ...
26
Bazerman, et al., (1985) found out how a conflict was framed or presented to negotiators
influenced whether they viewed...
27
The integrative approach to negotiations has roots in international relations, political
theory, research on labour dis...
28
the union does not want to bargain to what could legally be defined as an “impasse”
because then management may be free...
29
The second condition is important as it ensures that we do not regard each and every
situation of non-agreement, i.e. a...
30
by somehow removing it from the range of options available, the negotiators may try to
delegitimize it by reframing it ...
31
mild discrepancies in power often leads to stalemate as stronger parties respond to the
weaker party’s demand for equal...
32
Hypothesis 6: Deadlocks occur internationally because of certain configurations of
domestic interests
Even when levels ...
33
• Employ more pressure tactics. Your problem may not be a failure to communicate at
the table but rather a failure to f...
34
union or if they view the settlement as something higher-level officials negotiated over
the heads of their own negotia...
35
 When a party does not know something of relevance to the ongoing negotiations
which the other party does, there is a ...
36
sense, a buyer of services and the employee the seller, and the latter may have the more
potent sanction in the form of...
37
It can therefore be noted from the last two definitions that the authors agree that for
collective bargaining to take p...
38
2.5.2.0 MODELS OF COLLECTIVE BARGAINING
Good negotiating is not about outsmarting, outmaneuvering or manipulating the o...
39
of concession-making, whereby each side bargains with the other and compromises as
little as possible to keep the negot...
40
results in either the maintenance or the restructuring of the attitudes of the parties toward
each other
2.5.2.4 INTRA-...
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conventionally combined two levels- bargaining on the establishment of framework terms
and conditions at Industry level...
42
This is the model that is currently in application in Zimbabwe as provided for by the
Labour Act (Chapter 28:01) as wel...
43
where there is frequent non observance of agreements or understandings reached through
collective bargaining process, t...
44
2.5.3.6 PROPER INTERNAL COMMUNICATION
ILO (1996) stresses that both management and unions should keep their managers an...
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  1. 1. 1 CHAPTER ONE INTRODUCTION TO THE STUDY 1.0 BACKGROUND This Chapter will focus on introducing the subject of wage negotiations and collective bargaining in general and specifically to the Catering Industry sector of the economy in Zimbabwean. It is the researcher’s belief that expounding on the subject of collective bargaining and the wage negotiation process, the wage negotiation process can better be understood. A background to the study will be provided then followed by statement of the problem and research objectives and research questions for the study. The chapter will then conclude by giving a justification as to why it is necessary that this research be undertaken. The divide between employers and workers in wage negotiations is continuously becoming greater and greater, with the gap between workers’ expectations and demands against employers’ responses to those demands constantly increasing. To a large extent wage negotiations are confrontational and characterized by extreme inflexibility. They usually culminate in deadlocks, instead of agreements, whereupon the wage determinants are arrived at by arbitration or by judicial determination in the Labour Court. The wage levels sought by labour are generally understandable. This is because the employment income of most workers does not suffice to service the essential needs of the workers, their families and their dependants. Although the horrendous hyperinflation of 2008 has been contained, with inflation levels in Zimbabwe now being less than those prevailing in most of the countries of Africa, Zimbabwe has not yet experience deflation. Prices have however not declined but have only stabilized to levels marginally greater than those then prevailing. The consequences of Zimbabwe having attained the highest levels of inflation ever endured by any country, throughout recorded history, were horrendous especially for those that are in the lower income range. Not only were a majority of the populace unable to pay for the education and health of their families, but they could not even meet the most basic of needs. As prices have generally not declined the trials and tribulations of workers, and of those reliant upon them, have continued unabated. The result of those tragic circumstances is
  2. 2. 2 that the workers representatives in general and trade unions in particular, focus wholly on worker needs with total disregard for the ability or lack thereof of employers to meet their demands. As a general rule worker representatives are insistent that the minimum wage should equate the poverty datum line (PDL). However in demanding PDL-related wages, the worker negotiators disregard two key factors. The first of such is that the PDL relates to the requirements of families of six and in Zimbabwe, in any such family there are usually at least two income earners. However one of them maybe operating in the informal sector instead of being in formal employment. Inevitably, the two income earners will not be recipients of identical income. More often than not one of them will be generating about 60% of the family’s income, whilst the other generates only 40%. Worker negotiators have also developed an insensitive and despicable disregard for the extent of employer ability to pay wages at the levels demanded for them. On the one hand, almost all employers are grievously undercapitalized to finance their operations effectively. The hyperinflation that prevailed in Zimbabwe was of such magnitude that the organization’s capital resources were decimated and eroded. The illiquidity in the money market is pronounced, and the limited funding available is exceptionally costly and only available for very limited periods of time. Similarly, because of the tiny extent of accessible foreign investment with held because of concerns about the political and economic stability, it is presently difficult for organizations to access core working capital and therefore to fund the wages demanded by the employees. The ability of employers to pay well is also adversely affected by the need to be price competitive internationally. If production costs are markedly greater than those in other economies, then Zimbabweans are prone to purchasing imported products instead of those locally produced. As a result, exports fail to be competitive. This has already severely impacted upon the viability of Zimbabwean enterprises. Whilst wages paid are generally much less than what the workers need, it is long overdue for labour to recognize that inadequate wages are better than total unemployment, with associated zero incomes. Maybe the wage determination criteria must endure until such time as Zimbabwe can achieve substantive deflation. There is also a tendency amongst arbitrators to make wage determinations with retrospective effect, whereby they award the increases in wages with back pay to the date when negotiations had commenced. For almost all employers this has ruinous consequences. This is because they cannot increase their selling prices retrospectively. The goods or services sold prior to the arbitration were
  3. 3. 3 sold at prevailing prices at that time, and no customers will accept a subsequent price increase for the goods or services already purchased. The consequential effects of back pay awards are massive losses for the organizations subjected to such. In many instances it results in closure or liquidation of the organization, and the loss of employment for their workers. Arbitrators who award retrospective back pay are in practice, doing the workers a grave injustice and worsening their circumstances. It is in this context that this research has to be understood. Whilst in business, the human being has often arbitrarily been referred to as the most priced asset, very few organizations pay credence to this assertion. The implications on failure to handle this asset have far reaching and greater consequences both for the enterprise itself as well as the employees. It would be foolhardy for the enterprise to neglect the human beings in their businesses as mishandling such comes with great costs (economic/productivity) on the business. Issues of staff morale are central to the productivity of the enterprise and the national economy at large. The Zimbabwean economy prior 2012 beginning 2007 was characterized by periods of hyperinflation where prices of commodities were changing rapidly and at its worst twice or thrice a day. Payment of wages in the years 2007 and 2008 was converted into other forms in order to preserve value as the buying power of money had been eroded. Wage negotiations were now being done every second month. Companies experienced and continue to experience low capacity utilization, there are huge disparities between management and workers earnings leading to inflexibility on both parties which has now become very much prevalent. Furthermore the economy is not improving as had been expected due to lack of resources to recapitalize the business. Annual wage negotiations/bargaining have been taking place under this environment. In almost all Industries these wage negotiations did not yield much result as they all ended up having to be referred for arbitration as parties failed to agree on new wage minimums for each year. NEC Catering was also among the NECs that failed to register an agreement during this period and since the devolution of powers to NECs by the government. According to Dr. Kanyenze an economist with the ZCTU, limited scope and role of NEC was a major cause of wage disputes because they focus narrowly on wage negotiations. Very little is given to discuss the state of the economy, resources, development issues of productivity and competiveness. Employees often lack information and more critically, a shared vision of their sectors or firms thereby creating a fertile
  4. 4. 4 ground for contestation and inevitably conflict. Absence of a quality database for information is also another handicap that was sighted by Dr. Kanyeze when his opinion was sought on the causes of annual wage negotiation deadlocks. The National Employment Council (NEC) for the Catering Industry is the umbrella body representing all employers and employees in the Catering Industry. These include hotels, motels, lodges, fast food outlets, restaurants and bars. The body to which all employers in the catering industry belong is known as the Catering Employers Association of Zimbabwe (CEAZ). The CEAZ represents the interests of all employers in this industry. When negotiating for conditions of employment and annual salary increases the CEAZ has a secretariat mandated with engaging the trade union on behalf of all its members. On the other hand the there is the Zimbabwe Catering and Hotel Workers Union (ZCHWU) as part of the NEC members. The ZCHWU represents the interests of all employees in the Industry. Membership to both these institutions is voluntary and members who wish to be affiliated pay annual subscriptions that are meant to assist with the running of these institutions. The CEAZ and the ZCHWU have thus established a body mandated with ensuring that the minimum working conditions agreed upon by the two parties (i.e. CEAZ & ZCHWU) is being observed. This body is known as the National Employment Council for the Catering Industry (NEC). The National Employment Council then employs administrators and agents whose responsibility is to ensure there is harmony at the workplace. To this effect a booklet known as the Collective Bargaining Agreement (CBA) came into effect in 1991 and has now become known as Statutory Instrument 167 of 1991(SI 167/91). This statutory instrument was promulgated in line with the provisions of the Labour Relations Act of 1985. The agreement covers among other things some of the following issues; scope of application of agreement, alteration of agreement, administration of agreement, trade union representation on the council, registration of employers, wages, grading and increments, overtime rates of pay, payment of wages and many other areas of interest. All conditions of employment by workers in the Catering Industry are set out in Statutory Instrument 167 of 1991. These conditions have been negotiated between the employers and employees through their respective bodies, i.e. CEAZ & ZCHWU. The Labour Act in Zimbabwe stipulates the minimum working conditions that both parties are required to observe. The parties are however at liberty to better what has been set out in the Labour Act provided they have reached an agreement regarding those specific aspects.
  5. 5. 5 Collectively bargaining in Zimbabwe for most NECs is at the multi-employer level, meaning that employers come together to negotiate with one trade union responsible for the Industry. Whilst most conditions of employment conform to those stipulated in the Labour Act, some companies have adopted individual company policies that better the Statutory Instrument as well as the Labour Act. Every year all NECs find themselves in a position they have to set new minimum wages for their respective industries. Different NECs therefore negotiate for wage increments at varying times throughout the year. Previously government used to set and then announce minimum wages for Industries until 2002. NECs were then empowered to negotiate and agree on minimum wages for their respective industries, a position the NEC Catering Industry also find itself in. Since government empowered NECs to agree on minimum wages for their respective Industries, very few have been able to agree on new wage levels without having to refer the issue for arbitration and in some instances strikes taking place. At the time of the research, this researcher was advised there was already a case pending before the arbitrator regarding the awarding of salary differentials for grades 10 to 14 in the Catering Industry. Therefore this aspect of collective bargaining has been very topical year in year out with all cases having been referred for arbitration since 2002. There is therefore need to understand what factors are behind this failure by parties to reach an agreement on wages every year with regard to the Catering Industry. Almost across all industries in Zimbabwe from private to the public sector, every year there are always disagreements on wage negotiations which end up in a deadlock. These wage deadlocks are so widespread to an alarming extent that it has become standard to end up with arbitration. An independent arbitrator has to be appointed by the parties so that they can decide on an acceptable or compromise pay rise/increment between the two parties. In Zimbabwe, the varied employer associations and trade unions represented by their respective bodies are therefore either involved in collective bargaining for that specific period they would have agreed or have now referred the issue of wage negotiations to an arbitrator and now awaiting the outcome. Again as noted in the case of NEC Catering Industry, there has not been an instance where parties have concluded wage negotiations without referring the matter to an arbitrator. The issue of wage negotiations deadlock has been compounded by the fact that the general outlook of the economy has not been at its best. It is not a secret that since 2007 many companies have been operating at below capacity with some even failing to break
  6. 6. 6 even after the introduction of multi-currency in February 2009. Those that have failed to break even closed shop rendering the workforce jobless. In the Catering Industry several big names have applied for exemptions to pay for wages below the minimum wage stipulated by NEC because of their financial situation. It is now a public secret that the foreign direct investment expected over the years since the Global Political agreement has wilted and the expected incomes have not materialized. The country has not seen any meaningful investment despite parties in the GPA assuring the world that Zimbabwe is a safe destination to do business. Operating costs have been very high to the extent that in most instances goods from outside the country have been landing cheaper here in Zimbabwe. The effect again has been to put pressure on the local operators. The labour laws in Zimbabwe have also not helped much, for companies wishing to retrench in the unfortunate circumstance that they have failed to stay afloat, it has been a costly exercise. It is no surprise therefore that some organizations have chosen to go the voluntary liquidation way. As already noted, in 2002 the government of Zimbabwe made a decision to do away with the setting of minimum wages for most industries except for employees under the public service. The thinking behind was that government was involving itself too much in affairs that had nothing to do with it leaving no freedom to the private enterprise to allow market forces to determine supply of labour and how it was going to be priced. It was felt that it was not the government’s role for setting minimum wages, moreover it had carried industry long enough for it to be able to now stand on its own feet. From then on industries were expected to sit down at the negotiating table and agree on new yearly/periodic wage minimums for the various industries. The NEC for Catering Industry tops the list of perennial wage negotiation breakdowns especially in the last five years. It however needs to be noted that generally the world over the Hospitality Industry ranks among some of the lowest paying Industries and professions. This situation does not make it any better when parties now seat down at the negotiation table. To show that this problem of wage negotiation is not only peculiar to the NEC Catering Industry in Zimbabwe, here are some of the headlines and quotes found in newspapers in Zimbabwe and South Africa pertaining to the issue of wage negotiations deadlocks:
  7. 7. 7 “Employer and worker representatives in the insurance industry have referred 2012 salary negotiations to arbitration after a deadlock. But they have agreed not to contest the outcome of an independent mediator’s determination” (The Herald, Wednesday 11 January 2012) “The wage negotiations between public service unions including SADTU and the employer have reached a deadlock. The negotiations resumed yesterday (20 May) when the employer offered a 5.3% increase- a mere 0.1% increase from last week’s 5.2% offer implemented as from 1 July. This latest offer by the employer is disgraceful”. (www.sadtu.org.za/node/203) “Wage negotiations in South Africa’s gold sector came to a deadlock on Wednesday, with trade unions declaring a dispute with the Chamber of Mines. The National Union of Mineworkers (NUM) is asking for a 14% increase while solidarity is demanding a 12% pay rise. (www.miningweekly.com) “A final dispute meeting today between solidarity and employers in the Grain Bargaining Council deadlocked after employers offered a final wage offer of between 5% and 7%. An independent arbitrator last week recommended that all parties return to the negotiating table today with new mandates” (www.salabournews.co.za) The above quotes point to the wage negotiation problem across sectors in other countries outside Zimbabwe and to the south where South Africa is our neighbour. It would be easy to relate to South Africa being Zimbabwe’s neighbour as they share almost the same history. Is South Africa however unionism appears to be more vibrant that it is currently in Zimbabwe. A strong union is therefore more likely to be heard and advance the interests of its membership. In the extract in table 1.0 it can be noted that all wage negotiations that took place for the period January 2005 to September 2011 were all referred for arbitration. The parties (i.e. ZCHWU & CEAZ) failed to reach a conclusive agreement regarding new wage levels for each of the periods under review. Table 1.0 table gives the history of wage negotiation deadlocks in recent years
  8. 8. 8 Table 1.0 NEC Catering Wage Negotiation Deadlocks from 2007 to 2011 Period Involved Statutory Instrument Comments September 2011 No Statutory Instrument was promulgated Ref to Arbitration February to September 2010 No Statutory Instrument was promulgated Ref to Arbitration January to December 2009 No Statutory Instrument was promulgated Ref to Arbitration January to December 2008 No Statutory Instrument was promulgated Ref to Arbitration January to December 2007 No Statutory Instrument was promulgated Ref to Arbitration Source: National Employment Council for the Catering Industry As a result the parties referred all the wage negotiations to an Independent Arbitrator. During this whole period a lot of negotiations tensions and high, morale is low and productivity is not spared and there is a lot of anxiety since no one is sure of the outcome. In some instances when there are deadlock, it often leads to strikes as a last alternative. In order to illustrate the extent of the problem, below are a few examples taken from the Ministry of Labour Harare province statistics for the year 2009 on deadlocks wage. Table 1.1 Wage Deadlocks in 2009, sector by sector referred for Arbitration Wage Deadlock Date Declared 1 NSSA vs. Employees 30.03.09 2 Chloride vs. Chloride Workers Committee 23.04.09 3 National Commercial Employers of Zimbabwe vs. Commercial Workers Union 27.04.09 4 Chamber of Mines Zimbabwe vs. Associated Mine Workers Union of Zimbabwe 06.07.09 5 Detergents Edible Oils and Fats vs. Trade Union 30.07.09 6 Catering Employers Association (CEAZ) vs. ZCHWU 09.10.09 7 Harare Municipality vs. Harare Municipal Workers Union 10.06.09 8 Leather, Allied Employers Association vs. Workers Union 11.12.09 9 Banking Employers Association of Zimbabwe vs. Zimbabwe Industrial Banking Workers Union 18..05.09 Source: Ministry of Labour Harare Province 2009
  9. 9. 9 1.1 STATEMENT OF THE PROBLEM The Government has left collective negotiation/bargaining for industries with employment councils to conclude wage negotiations on their own. Since then there has been continuous deadlock in wage negotiations every year in industry resulting in parties referring the deadlock to an independent arbitrator. The NEC Catering has also not been spared. This failure to conclude wage negotiations in time and having an independent arbitrator make a ruling has not helped the employee-management relations at the workplace. Productivity has been affected as a result of the low morale of the employees who are anxious about the outcome of the wage negotiations meaning the continuity of the enterprise is a t risk because of low productivity. The aim of this study is to identify the causes of wage negotiation deadlocks so as to assist employees and management reach amicable solutions and avoid industrial disharmony, improve relations and the smooth operation of the enterprise. The costs associated with low morale and arbitration outcomes (in some instances back pays for up to six months) are too huge to bear for the organization and hence it is in both parties interests to avoid deadlocks 1.2 RESEARCH OBJECTIVES 1. To identify the wage negotiation/bargaining process and how its conducted 2. To establish the underlying causes of wage negotiation deadlocks 3. To identify alternatives to the ways of wage negotiation process 4. To recommend how the negotiation process can be improved to minimize wage negotiation deadlocks. 1.3 RESEARCH QUESTIONS 1. How is the wage negotiation process conducted? 2. What are the causes of wage negotiation deadlocks? 3. What alternatives are available to determining wages? 4. How can the wage negotiation process be improved to avoid arbitration?
  10. 10. 10 1.3.1 PROPOSITION Wage negotiation deadlocks are as a result of parties not negotiating in good faith. 1.4 SIGNIFICANCE OF THE STUDY It is the researchers’ conviction that the research brought out significant issues in an area that parties have taken for granted in a long time of negotiating. It is only through understanding the causes of wage negotiation deadlocks that trade unions and employer representatives are better equipped to respect the negotiation process and avoid deadlocks. The parties are then able to appreciate and to tolerate each other’s view point and hence decision making is improved. When wage negotiation deadlocks are avoided the employees are motivated and are less likely to bring attitudes at the workplace which may rub onto guests and affect service delivery. Instead the employees are productive and give their best as they have no anxieties or worries. The employers on the other hand are able to better plan their finances and cash flows in the absence of deadlocks. The costs of deadlock come in the form of low morale, reduced productivity and high employment costs as a result of back pays that the employer may be ordered to pay. It therefore means that when there is agreement from the onset the employer is certain as to what they are going to pay and will not need to face back pays which would not have been budgeted for. When service is seamless and uninterrupted this has the effect of attracting more customers in future since they are going to talk good about the organizations and industry as a whole. Tourism ranks amongst the top five major income earners for the country. The more arrivals we have the better for the economy as they bring in money to spend since they will be satisfied with the service. As a result the economy grows and the country is able to meet some of its obligations towards its citizens. It is also important in the adjustment of the balance of payments for the country. The research benefited the researcher in fulfilling the requirements of the School of Business Sciences for the attainment of the Master of Science in Strategic Management. The researcher also benefited from the new knowledge made available of the subject of collective negotiation/bargaining by undertaking the research and getting first hand information on the practices in organizations.
  11. 11. 11 1.5 SCOPE OF THE STUDY The research was conducted at the National Employment Council for the Catering Industry sited at number 87 Selous Avenue, Harare. The NEC Catering is made up of Catering Employers Association of Zimbabwe (CEAZ) representing all the employers on the one hand and the Zimbabwe Catering and Hotel Workers Union (ZCHWU) on the other hand. Therefore the secretariat and administrators at the NEC was asked to give their opinions by use of questionnaires. The trade union representative and employer representatives interviewed constituted those who have a direct bearing on the negotiation process. It is the researcher’s belief that the chosen sample will be a true representation of the views and opinions of the Industry. The study was conducted over a period of two months. 1.5.1 LIMITATIONS  Human Resources Management- the study is narrowed to the social sciences domain and therefore limited to the Industrial Relations at the workplace  Financial constraints - a lot of costs were involved in typing, printing, binding, internet and travelling during the course of the study.  Confidential information – respondents are always not comfortable in fully disclosing information in fear of the unknown. 1.6 DEFINITION OF TERMS BATNA- Best Alternative to a Negotiated Agreement CBA- Collective Bargaining Agreement CEAZ – Catering Employers Association of Zimbabwe CUT- Chinhoyi University of Science Technology ILO- International Labour Organization NEC- National Employment Council for the Catering Industry SI- Statutory Instrument ZCHWU- Zimbabwe Catering and Hotel Workers Union
  12. 12. 12 1.7 RESEARCH OUTLINE This study report is presented in five chapters. Chapter 1 is the Introduction to the research, Chapter 2 (Literature Review) reviews the literature related to wage negotiation/bargaining. The reviewed literature will be used in the critical analysis of the study findings. Chapter 3 (Methodology) presents the methodology on how the study was conducted. Chapter 4 (Results and Discussion) presents the study findings and discussion of the study findings. Chapter 5 outlines the conclusions and recommendations of the study derived directly from the research findings. Furthermore, the chapter presents the suggested area of further research as shown by the study findings. The next chapter presents the literature review of the study. 1.8 CHAPTER SUMMARY A background to the study was provided detailing how the government left NECs to determine wage negotiations on their own without the involvement of government anymore. This was then followed by stating what the problem of the study will be focused on highlighting the costs of failure to reach agreement when negotiating. Research objectives and questions were then provided to help shape and guide the research followed by significance of the study. In other words of what importance is this research to the employee, employers, the economy and nation as a whole? The Chapter then closed by giving an outline of the structure the dissertation followed.
  13. 13. 13 CHAPTER TWO LITERATURE REVIEW 2.0 INTRODUCTION This chapter presents a review of related literature. The chapter begins by exploring literature related to the negotiation theories and models of collective bargaining. The principled negotiation process and its’ requirements are discussed in greater detail followed by causes of wage negotiation deadlocks. The approach taken is that negotiation is a component of collective bargaining, hence to understand wage negotiation reference should also be paid to collective bargaining. As a follow up, ways to overcome wage negotiation deadlocks are then discussed enabling parties to understand and appreciate their short comings so that they do not fall into the same mistakes again. The penultimate discussion is then on alternatives to the collective negotiation process and new ways of determining wages without resolving to collective negotiation. The chapter concludes by looking by summarizing the discussion on wage negotiations. 2.1 THE PRINCIPLED NEGOTIATION PROCESS 2.1.1 NEGOTIATION (Kersten, Michalowski, Szpakowicz and Koperczak: 1991) argue that negotiation is a form of decision making with two or more actively involved agents who cannot make decisions independently, and therefore must make concessions to achieve a compromise. The effectiveness of negotiation is measured by the degree of achievement of the goals which were put forward by agents. Negotiation is also a method of conflict resolution, and as such it is used in modeling of decision processes. Pilbeam and Corbridge (1997) agree with Kersten et al (2003) in saying that negotiation is a process whereby two or more interested groups seek to reconcile their differences through attempts to persuade the other group to move from their initial position, with the overall aim of reaching agreement.
  14. 14. 14 Alvarez and Kennedy (2006) put it more interestingly by saying that negotiation is the art of letting them have your way. They say your task is to understand and shape your counterpart’s perceived decisions, so that the counterpart chooses in its own interest something you also want. Alvarez and Kennedy (2006) further point out that people think of negotiating power as being determined by resources like wealth, political connections, physical strength, friends and military might. In fact the relative power of two parties depends primarily upon how attractive to each the option is of not reaching agreement. The aim of negotiation is therefore to try and reach agreement by convincing the other party to see things in the same light as you. Kersten et al (1991), Pilbeam and Cobridge (1997) and Alvarez and Kennedy (2006) are of the same view. 2.1.2 PRINCIPLED NEGOTIATION- PRE-NEGOTIATION PREPARATIONS According to Silva (1996) there are various activities that one needs to undertake before engaging the other party. www.au.af.mil summarizes the pre-negotiation preparations as follows; A party wishing to arrive at a satisfactory conclusion or arrangement through collective bargaining should first identify the objectives of the exercise. “The negotiating team, and the respective roles of the members, should be determined before the negotiations. Employers would find it useful to include in the team people from different disciplines. The union’s demand should be carefully studied. It is a matter of assessment in each situation as to whether the management should make an initial response in writing to the union before negotiation commence. Since negotiations may not proceed to take place in the way a party may plan, party should be able to provide alternative options to wheat he, or the other party, expects. A party to collective bargaining negotiations has to formulate a strategy for all stages of the negotiation, including the pre-negotiation stage”. www.au.af.mil According to Fisher and Ury (1991), principled negotiation has a great deal in common with the process of consensus team decision making. There are seven conditions which are essential if a principled negotiation is to have a successful outcome. In the next discussion an elaboration of the principled negotiation requirements is now provided for better understanding of the concept.
  15. 15. 15 2.1.3.0 PRINCIPLED NEGOTIATION PROCESS- REQUIREMENTS Once you have established the necessary condition for negotiations, the process can now take place. There is no inflexible rule as to who should open negotiations. However it is not unreasonable for the management to claim that if the union has initiated the negotiations, it should make it clear at the outset that agreement on any particular issue is subject to an overall assessment, including its own expectations from the union. 2.1.3.1 PEOPLE: SEPARATE THE PEOPLE FROM THE PROBLEM Afredson and Cungu (2008) notes that Fisher et al., (1991), argued that parties in a dispute often forget that the other side consists of people who, just like themselves, are subject to human frailties such as emotions, potentials for misunderstandings and mistaken assumptions. A common failing when there is a difference of opinion or goals is to attack the opposing person while attacking the opposing position, especially if the attack is demeaning. It will unfairly have negative outcomes in both decisions making and bargaining. Experienced negotiators separate the people from the problem. Fisher and Ury (1991) suggest the following ways:  Relationships. Bargaining, even principled bargaining, may involve strong comments about the substantive issue. It is only human nature that these, on occasions are taken as personal attacks, generating emotions that block communication. A good relationship can be a vaccine against communication blockage.  Perceptions. In the heat of battle, it is easy to view the opponent as a personal enemy, as opposed to someone who is just doing a job. Effective negotiators must get inside the heads of their opponent so that they can see the issues as they do. From inside the opponent’s frame of reference, many things become clearer: why a given position is held so fiercely, where the vulnerabilities are, where there are doubts and where there may be blind spots. Perceptions come in many ways. Colosi (2000) makes a point of the importance of body language and tone as communication channels that give information, sometimes information of crucial
  16. 16. 16 value to the other side, Fisher and Ury (1991) emphasize such things as acting inconsistently with expectations.  Emotion. Experienced negotiators have long since learned how to manage their emotions. A part of this is understanding that there are going to be emotions. Skilful negotiators can turn anger on and turn it off for effect, while at the same time avoiding the blow and counterblow that gets out of control. If under personal attack, promise- do not threaten. You may highlight that these are personal attacks which are not relevant to the substantive issue and for that reason they are unfair.  Communication. The essence of communication is the transmission of meaning. According to Fisher and Ury (1991), much communication in positional bargaining fails because meaning is not clearly transmitted, where bargaining is positional, Colosi (2000) adds that one may want to be cautious about the direction of communication. The mandate is for active listening, getting the other person to talk more and thus reveal more. Listening with interests to what the other negotiator has to say pays dividend, you are getting valuable information about his/her position and intentions, without giving away your own. 2.1.3.2 INTERESTS: FOCUS ON INTERESTS NOT POSITIONS According Fisher and Ury (1991), the first step is to identify the interests involved in an issue as opposed to dealing with positions of the negotiating parties. Lens (2004), argues that if a positive relationship can be established with the other negotiator, the only remaining ingredient for principled negotiation is finding shared interests that can serve as the common ground for generating creative options. Interests are a key issue because interests are the factors underlying the decisions. Sometimes when principled negotiation is not possible and harder positional bargaining must be used. When that is the case, it pays to know if there are divisions in the enemy camp. Colosi (2000), point out that there probably will be stabilizers who would bargain soft and destabilizes who would bargain very hard indeed, and it might scuttle the negotiations if they could. A thorough understanding of the other side’s case is essential for the exploitation of their differences.
  17. 17. 17 2.1.3.3 OPTIONS: GENERATE SEVERAL OPTIONS BEFORE DECIDING WHAT TO DO Afredson et al., (2008) point out that once parties have begun to build relationships and to exchange information in order to gain a clearer understanding of the intentions at stake, the parties should turn to the task of generating options. In negotiations, options are possible solutions to a problem shared by two or more parties. In integrative bargaining, options represent possible ways of meeting as many of both parties’ interests as possible. When using the principled negotiation options for action can often be the hardest to get partners to participate in. Fisher et al (1991) suggest that there are four particular obstacles to this: premature judgment, searching for a single answer, assumption of a fixed pie and thinking that no-one else is able to assist in problem solving. It is here that negotiators have the best opportunity to expand the pie. As long as options are kept open, many avenues for creative ideas may appear. 2.1.3.4 ALTERNATIVES In order to set realistic goals, negotiators must start by considering certain fundamental questions: where will each side be if no agreement is reached? What alternative solutions are available for meeting your goals if you cannot count on the cooperation of the other side? Fisher and Ury (1991), argue that it is critical for both parties to know their BATNA (Best Alternative to a Negotiated Agreement) both before and throughout all stages of a negotiation. A Best Alternative to a Negotiated Agreement provides negotiators with a measure of flexibility that is lacking from a bottom line. Unlike bottom lines Best Alternatives to a Negotiated Agreement’s change when negotiators perceive a change in their alternatives. Alfredson and Cungu (2008) points out that when negotiations are viewed in terms of Best Alternative to a Negotiated Agreements’, as opposed to positions or bottom lines, the negotiation can continue even when figures are rejected because negotiators are freer to continue to explore additional possible solutions. Negotiators who fail to evaluate their alternatives to an agreement both before and during the process may therefore also be in danger of rushing to an agreement without having fully considered their or the other party’s alternatives, leading one side to end up with a deal that should have been rejected.
  18. 18. 18 2.1.3.5 CRITERIA/LEGITIMACY When bargaining over positions, negotiators create a situation in which one side must concede his original claim in order for negotiations to succeed. Positional bargaining is bargaining in which two sides lock into compatible positions. According to Fisher et al., (1991), this can lead to a contest of wills, bitterness and deadlock. They maintain that when negotiations are approached in this way, even when a deal is made, it may come at high cost. The authors instead argue that there is a better way to approach the negotiation process. This involves invoking objective criteria as part of the negotiation process. According to Lens (2004), once options have been generated, the next step is to evaluate them and to find a fair solution based on merits. It helps to be concrete but flexible- in other words, to work through the options in detail, but to treat the options as illustrative rather than fixed. The commitment has to be to address the participants’ interests (not positions) and, by pushing hard on the interests, partners can stimulate each other’s creativity in thinking up mutually advantageous solutions. Developing an agreement should be framed as a joint search for objective or fair criteria and this will promote reasonableness, fair play and trustworthiness 2.1.3.6 COMMITMENTS A negotiated settlement is only enduring if all the parties honour the commitments that they make. Afredson et al., (2008) emphasizes that, of course, those that fail to follow through on their promises stand to suffer a loss of integrity, be subject to the resentment of the other side, and risk that their partner in the negotiations (and possibly others outside of the deal as well if word of their reputation escapes) will refuse to deal with them in the future. Therefore no party to a negotiation should intentionally create commitments that they do not intend to honour. Fisher and Ertel (1995), points out that during negotiation process, parties should think carefully about the kind of commitments they should be prepared to make? Are they capable of honouring them? How broad should the commitments be? When will each party be expected to make good on their promises? One way of building trust is to create a commitment structure that can be implemented in stages
  19. 19. 19 2.1.3.7 COMMUNICATION Negotiation is only possible through communication. Fisher and Ury (1991), maintain that the feeling heard is also a key interest for both sides in a negotiation. Good communication can change attitudes, prevent or overcome deadlock and misunderstandings and help improve relationships. Moreover, good communication skills are essential to clearly relay your message, and to thoroughly understand the message of the other side (Wondwosen, 2006). In addition, integrative approaches stress the importance of sharing information as a means of uncovering interests and of helping parties to explore common problems or threats. Still negotiators are frequently hampered in theories roles by common communicational errors or inefficiencies. 2.2.0 THE NEGOTIATION PROCESS Most authors on negotiation reference back what Fisher and others have said regarding the whole concept of negotiation. According to Fisher and Ury (1991), there can be no doubt that that the process is a contest where each negotiator can take nothing for granted, and can even relax. Even if it is possible to establish mutual interests and move into the principled negotiation mode, prudence demands risk analysis and control. The more consequential the issue, the more important risk management is. Experienced negotiators say that you should prepare, prepare, prepare. The Air Force Negotiation Centre for Excellence, USA (2011) outlines the negotiation process as given below. 1) Discover what the other side knows 2) Educate the other side on your position 3) Make the other side advocate for your position 4) Determine enforcement means 5) Enhance implementation through good relationship 2.2.1 DISCOVER WHAT THE OTHER SIDE KNOWS According to the Air Force Negotiation Centre for Excellence (2011), until the other side establishes trustworthiness by credible performance, you must learn as much about the
  20. 20. 20 other side’s position as possible, while revealing as little as possible about one’s own. It is important that you should have completed preliminary work, to cope out what the other side’s position and strategy will be, so you aren’t hearing it in negotiations for the first time. Secondly you should have selected your team with an eye toward enhancing your ability to figure out the other side, its strengths and weaknesses. 2.2.2 EDUCATE THE OTHER SIDE ON YOUR POSITION Lens (2004), reiterates the need to get the other side to lose its confidence in its position while gaining confidence in yours. This is where education comes in the process of selectively revealing information that strengthens your case while questioning that of the other. Lens (2004), says it sounds like a breach of ethics to reveal information selectively to strengthen your case while weakening your opponent’s. However if trust is established, negotiation is a contest. You would not use your weak arm to arm-wrestle with a stinger. Ethics to do in negotiation has to do with being principled and fair, and neither demands complete disclosure. The decision in negotiation is whether the negotiators agree on, and can convince their ratifiers to accept it. 2.2.3 MAKE THE OTHER SIDE ADVOCATES FOR YOUR POSITION According to Fisher et al., (1991) as you educate the other side to see the advantages of your position, you want to undermine their confidence in their own position. These two principles, educating the other side on your position and creating doubt about their own position, are a cyclical process. It is important to make the other side an advocate for your own position. According to Colosi (2000), neither you nor they will have the power to decide. That power has been withheld by those who sent you to negotiate for them. So part of your strategy is to manage the other side’s access to your ratifiers. You don’t want someone as good as you are to have access to your own decision makers. 2.2.4 DETERMINE ENFORCEMENT MEANS Glaser (2005), points out that it is important to enhance both enforcement and implementation by building in objectively verifiable means. Fisher et al., (1991) argues
  21. 21. 21 that even with principled negotiation and trust, future doubt or suspicion can be avoided by including in the agreement some objective means of checking that the agreement is honoured by both sides, and for enforcing compliance. Sales contracts, for example, have clauses that address the potential for default. Equally negotiated agreements should be written how non-compliance would be treated. 2.2.5 ENHANCE IMPLEMENTATION THROUGH GOOD RELATIONSHIP It is essential to maintain good relationships with the other side. A good relationship enhances the operation of the preceding principles, and, indeed may be essential to some of them. Further, according to Fisher et al., (1991) if initiatives towards principled negotiation get no response from the other side, maintain a good relationship in spite of all adversity you may produce a change of heart with your opponent. Principled negotiation can emerge at almost any time, so long as one negotiator has been behaving in a principled manner all along. Below are steps in negotiation as adapted from www.examiner.com 1) Agree to negotiate 2) Gather points of view 3) Focus on interests 4) Create win-win options 5) Evaluate options 6) Create an Agreement Source: www.examiner.com 2.3.0. THEORIES OF NEGOTIATION Wikipedia underlines the fact that negotiation is a specialized and formal version of conflict resolution most frequently employed when important issues must be agreed upon. Accordingly, negotiation is necessary when one party requires the other party’s agreement to reach its aim. The aim of negotiating is to build a shared environment leading to long-term trust. Alfredson and Cungu (2008) points out that those negotiation theories may be prescriptive, descriptive or normative in nature. Additionally theorists
  22. 22. 22 and practitioners from various disciplines have developed and utilized a variety of approaches or levels of analysis to improve their understanding of particular aspects of negotiations. Alfredson and Cungu (2008) further expatiate by saying, while formal definitions of negotiation vary, theorists do accept certain basic tenets. Foremost among them is the assumptions that parties who negotiate agree in at least one fundamental respect; they share a belief that their respective purposes will be better served by entering into negotiation with the other party. Implicitly then, negotiating parties have come to the conclusion, at least for a moment, that they may be able to satisfy their individual goals or concerns more favourably by coming to an agreed upon solution with the other side, than by attempting to meet their goals or concerns unilaterally. Schelling (1960) goes on to say that it is this mutual perception that leads to the onset of negotiations and betrays the independence that exists (to whatever degree) between negotiating parties. This common interest in shared agreement is the starting point for the common interest and mutual dependence that can exist between participants in a conflict. It may be important at this juncture to say a word here about strategies and tactics and how they fit into the various schools before focusing on our next discussion on the various approaches to negotiation. The Merriam-Webster Dictionary (1994) defines a strategy as a careful plan or method, especially for achieving an end. Whereas the use of tactics refers to the skill of using available means to reach that end. According to Alfredson and Cungu (2008), theorists differ on how to categories the main schools of thought in negotiation. Druckman (1997) describes the main schools of thought in negotiation theory as corresponding to four approaches to negotiation: negotiation as a puzzle solving, negotiations as a bargaining game, negotiation as organizational management and negotiation as diplomatic politics. Alternatively, Raiffa (1982) puts forward a typology of approaches crafted around dimensions of symmetry- asymmetry and prescription-description. Zartman (1988) presents five levels of analysis or core approaches. These are structural, the strategic, the processual (concession- exchange), the behavioural and integrative approaches. However in practice according to Afredson et al., (2008) most negotiators use a combination of approaches and borrow from all kinds of schools of thoughts during a negotiation. The approaches to negotiations are now discussed below, one after the other.
  23. 23. 23 2.3.1 STRUCTURAL APPROACH These consider negotiated outcomes to be a function of the characteristics or structural features that define each particular negotiation. These characteristics may include features such as the number of parties and issues involved in the negotiation and composition or relative power of the competing parties (Raiffa, 1982; Bacharach and Lawler, 1981). According to Zartman (1976) structural approaches to negotiation find explanations of outcomes in patterns of relationships between parties or their goals. They can be deterministic in that they often view outcomes as a priori once structural factors are understood. In structural approaches to negotiation theory, analysts tend to define negotiations as conflict scenarios between opponents who maintain incompatible goals. Afredson and Cungu (2008) argue that analysts who adopt a structural approach to the study of negotiations share an emphasis on the means parties bring to a negotiation. According to Bacharach and Lawler (1981), one of the main theoretical contributions derived from the structural approach is the theory that power is the central determining factor in negotiations. In this view relative power of each party affects their ability to secure their individual goals through negotiations. Structural theories offer varying definitions of power. For example power is sometimes defined as the ability to win, or alternatively, as the possession of strength or resources. In trying to understand why victory in negotiations does not always go to the party who is ostensibly the more powerful, analyst taking a structural approach have looked at additional structural properties such as symmetry-asymmetry, the availability of alternatives or the role of tactics in detail. According the wikipedia structural analysis is easy to criticize because it predicts that the strongest will always win. This however does not always hold true. Negotiators need to be aware that a blind attachment to winning all you can from negotiation regardless of the resulting satisfaction of other parties, can be a poor long term strategy if it means that the other side will lose its will, or ability to maintain its side of the negotiated agreement. 2.3.2 STRATEGIC APPROACH Random House Dictionary (1993) defines strategy as a plan, method, or series of manoeuvres for obtaining a specific goal or result. Strategic approaches to negotiation
  24. 24. 24 have roots in mathematics, decision theory and rationale choice theory and also benefit from major contributions from the area of economics, biology and conflict analysis. Emphasis in strategic models of negotiation is on the ends (goals) in determining outcomes. Strategic models are also models of rational choice. Negotiators are viewed as rational decision makers with known alternatives who make choices guided by their calculation of which option will maximize their ends or gains, frequently described as payoffs. Actors choose from a choice set of possible actions in order to try and achieve desired outcomes. According to Raiffa (1982), each actor has unique incentive structure that is comprised of a set of costs associated with different actions combined with a set of probabilities that reflect the livelihoods of different actions leading to desired outcomes. Strategic models tend to be normative in nature because they are grounded in the belief that there is one best solution to every problem, they seek to represent what ultra smart, impeccably rational, super people should do in competitive, interactive situations. Because they look for best solutions from all perspectives of a negotiation, this approach has been called symmetrically prescriptive (Raiffa: 1982). Snyder and Diesing (1977), points out that the strategic approach is the foundation for negotiation theories such as game theory and critical risk theory. 2.3.2.1 COOPERATIVE OR COMPETITIVE: A NEGOTIATORS DILEMMA According to Alfredson et al., (2008) one of the best known games to treat negotiations is the Prisoner’s Dilemma Game. The game reflects the following scenario. Two prisoners are awaiting trial for a crime they committed. Each must decide between the two courses of action: confess or not. If neither person confesses, in other words, they cooperate with each other; each prisoner will have to serve a prison term of two years. On the other hand, if both prisoners chose to defect and turn evidence against one another, both prisoners will be faced with a four year prison term. If the game ended here cooperation by the two prisoners would be likely, but in the classic version of the game there is another set of alternatives. The prisoners learn that if one party cooperates and the other defects the one who defects will not serve time, leaving the one who refused to testify against his partner to serve the full five year sentence. Because each player is seeking to maximize his own outcomes, and neither knows what the other will do, the game demonstrates that the
  25. 25. 25 rational player will choose defection every time because he realizes that by choosing to defect he will fare better in the game, no matter what his opponent does. Negotiators face a similar challenge in their decision-making as they also have incomplete information about the other negotiator’s intentions. In bargaining scenarios, this formulation suggests that agreements are unlikely because each party has an incentive to defect in order to maximize his own gains. However such an outcome is sub-optimal because players would be better off if they both cooperated. In real life cooperation does occur. 2.3.3 BEHAVIOURAL APPROACH According to Afredson and Cungu (2008) behavioural approaches emphasize the role negotiators’ personalities or individual characteristics play in determining the course and outcome of negotiated agreements. Nicholson (1964) further elaborates by pointing out that behavioural theories may explain negotiations as interactions between personality types that often take the form of dichotomies, such as shopkeepers and warriors or hardliners and soft liner where negotiators are portrayed either as ruthlessly battling for all or diplomatically conceding to another party’s demands for the sake of keeping peace. The tension that arises between these two approaches forms a paradox that has been termed the “toughness dilemma’ or the negotiators’ dilemma (Zartman, 1978; Lax and Sebenius, 1986). The dilemma states that though negotiators who are tough during a negotiation are more likely to gain more of their demands in a negotiated solution, the trade off is that in adopting his stance, they are less likely to conclude an agreement at all. The behavioural approach derives from psychological and experimental traditions but also from centuries old diplomatic treaties. These traditions share the perspective that negotiations-whether between nations, employers and unions or neighbours are ultimately about individuals involved. Approach highlights human tendencies, emotions and skills. They may emphasize the role played by arts of persuasion, attitudes, trust, perception, individual motivation and personality in negotiated outcomes. Another important contribution from the behavioural approach is the work on framing. According to Raiffa (1982), frames refer to the way a problem is described or perceived. Is the glass half full or half empty? The way a question is posed can make certain evaluative objectives significant and thereby influence the outcome. Neale and Bazerman (1985) and
  26. 26. 26 Bazerman, et al., (1985) found out how a conflict was framed or presented to negotiators influenced whether they viewed their task as one of maximizing gains or minimizing losses. It also influenced the likelihood of reaching a negotiated settlement. 2.3.4 CONCESSION EXCHANGE (PROCESSUAL) APPROACH According to Zartman (1978), this approach (which Zartman calls the processual approach) looks at negotiation as a learning process in which the parties react to each other’s concession behaviour. From the perspective negotiations consist of a series of concessions. The concessions mark the stages in negotiations. They are used by parties to both signal their own intentions and to encourage movement in their opponent’s position. Parties use their bids both to respond to the previous counteroffer and to influence the next one; the offers themselves become an exercise in power. The risk inherent in this approach according to Afredson and Cungu (2008) is that participants engaged in concession-trading may miss opportunities to find new, mutually beneficial solutions to their shared dilemma and end-up instead in a purely regressive process which leaves both sides with fewer gains than they could have if they had pursued a more creative approach. 2.3.5 INTEGRATIVE APPROACH Lewicki et al.,(2003) states that, where as a zero-sum game view sees the goal of negotiations as an effort to claim one’s share over a fixed amount of pie, integrative theories and strategies look for ways of creating value or expanding the pie so that there is more to share between parties as a result of negotiation. Integrative approaches use objective criteria, look to create conditions of mutual gain and emphasize the importance of exchanging information between the parties and group problem solving. Because integrative approaches emphasize problem solving, cooperation, joint decision making and mutual gains, integrative strategies call for participants to work jointly to create win- win solutions. They involve uncovering interests, generating options and searching for commonalities between parties. Negotiators may look for ways to create value, and develop shared principles as a basis for decision making about how outputs should be claimed (and who claims them).
  27. 27. 27 The integrative approach to negotiations has roots in international relations, political theory, research on labour disputes and social decision making. Looking at labour, Walton and McKersie (1965) published a theoretical framework for understanding the negotiation process which they also applied to exchanges in international relations and disputes over civil rights. They described integrative bargaining as bargaining in which negotiators employ problem solving behaviour. Above all it must be noted that negotiation is a process. As such planning for and negotiating over the process itself are as critical for the outcome of a negotiation as the negotiation over the substantial issue themselves. According to Wondwosen (2006) taking time to negotiate the process before diving into talks is beneficial to all the parties involved. It might be time consuming, but in the long run (negotiating the process) will not only save time, but will also enable wiser, more robust and more valuable deals. Principled negotiation is another phase theory of negotiations that falls in the integrative school. Fisher and Ury (1981) argue principled negotiation goes beyond the limited strategic choices of distributive bargaining. They frame negotiations as a three-phase process whose efficiency depends on how negotiators treat four essential elements: interests, people, options and criteria. According to Afredson and Cungu (2008), in a later work, these pillars were refashioned into seven elements of negotiation comprising interests, relationships, options, legitimacy, alternatives commitments and communications. In the principled negotiations model, the essential elements serve as prescriptive components for negotiations modeled on an integrative approach. 2.4.0 CAUSES OF NEGOTIATION DEADLOCKS AND SOLUTIONS Muthoo (2000) stresses that if the bargaining process is frictionless, i.e. neither party incurs any costs from haggling, then each player may continuously demand that agreement be struck on terms that are most favourable to them. In such a circumstance the negotiations end up in an impasse (or deadlock), since negotiators would have no incentive to compromise and reach an agreement. If it did not matter when the negotiators agree, then it would not matter whether they agree at all. Impasse means the point at which no further progress toward an agreement appears likely because neither side is making further movement on major unresolved issues. Normally
  28. 28. 28 the union does not want to bargain to what could legally be defined as an “impasse” because then management may be free to stop following the old contract, stop collecting dues, and unilaterally change wages, hours, and working conditions. In private sector cases, the union would have to file charges with the National Labour Relations Board if the employer declared impasse and imposed unilateral changes. In public sector cases, the state or local agency that oversees labour law enforcement would decide whether impasse had been reached (www.theworksite.org). The NLRB or other appropriate agency will ask such questions as • How many times have the two sides met? • How firm do they seem to be about their positions? • Has each side made its last, best, and final offer? Narlikar’s (2010) analysis is more comprehensive where she defines a negotiation process as deadlocked if and when the following two conditions are present: 1) An extended situation of non-agreement exists such that parties adopt inconsistent positions and are unable or unwilling to make concessions sufficient to achieve a breakthrough on the particular issue; and 2) A landmark moment in negotiation process which may be an action-forcing event in the shape of a chair’s text or deadline imposed by a negotiator, or may be a natural landmark endogenous to the negotiation and recognized as such by the parties involved despite having set up expectation towards a compromise, is unable to trigger the necessary concessions toward agreement on the particular issue. Both conditions must exist for us to identify a situation as one of deadlock. According to Faure (2005), the first condition captures his idea of a protracted standstill of the dynamics of the negotiation system. But it clarifies the definition by providing a harder condition for deadlock: that parties adopt inconsistent positions, and further, that movement in the form of insufficient concessions does not signify an end to deadlock. To see the deadlock broken, we would need to see agreement on the particular issue under negotiation. It also helps us see resolving deadlocks as distinct from the set of tasks associated with conflict resolution: breaking deadlock involves finding a solution to a situation of standstill rather than escalatory dynamic.
  29. 29. 29 The second condition is important as it ensures that we do not regard each and every situation of non-agreement, i.e. all stages of the negotiation process until agreement is reached, as one of deadlock. Deadlock does not begin on day one of every negotiation, even though the seeds of the deadlock may be sown on day one. We would recognize a situation of deadlock only after a landmark moment for agreement passes by and non- agreement persist. A deadlock is a special and narrow case of non-agreement or non- cooperation (Narlikar, 2010). Narlikar (2010) acknowledges that deadlocks can be a product of strategic choice. Negotiators have a range of strategies with the strict distributive strategy forming one end of the spectrum and a purely integrative strategy the other. According to Narlikar (2010), the distributive strategy comprises a set of tactics that are functional only for claiming value from others and defending against such claims when one party’s goals are partly in conflict with those of others. Examples of strict distributive strategies include: high opening demands, refusing all concessions, exaggerating one’s minimum needs and priorities, manipulating information to others’ advantage, taking other issues hostage, worsening their BATNA (Best Alternative to a Negotiated Agreement), issuing threats, imposing penalties. However, to root explanations for deadlocks primarily in strategy choice presents more of descriptive than analytic claim. In order to therefore explain the causes of deadlock, six assumptions have been presented to explain the occurrence of deadlocks. Hypothesis 1: Deadlocks occurs because of superior BATNA or occur whenever and as long as parties believe their alternative to agreement is superior to the deal on offer. According to Fisher and Ury (1991), standard negotiation analysis suggests that the deadlock occurs if all the parties believe their BATNA is superior to the proposed agreement. They argue that, as such they have no incentive to make concessions to reach an agreement. An alternative argument would be that the zone of agreement has shrunk so much that it is better to have no agreement at all that the one on the table with its limited gains and high costs. According to Fisher and Ury (1991), in other conditions however, when a particular problem is especially difficult to resolve, it may be possible for negotiators to work around it through an alternative solution set. For instance if the negotiator perceives his her BATNA to be superior to the agreement, besides attempting to worsen that BATNA
  30. 30. 30 by somehow removing it from the range of options available, the negotiators may try to delegitimize it by reframing it in terms of unfairness or bring in a third party as a mediator. Narlikar (2010) suggests that the way of getting round this, if the principal cause of deadlock is the availability of a better BATNA, negotiators will have to expand the zone of agreement such that its gains come to outweigh the BATNA. They might simultaneously or alternatively pursue a strategy of worsening the BATNA of the parties and thus bringing them back to the negotiating table. Hypothesis 2: Deadlocks occur because negotiators bluff and lie. Bluffing is a common place in most bargaining situations (Schelling, 1960 and Walton and McKersie, 1965). However not all bluffs result in deadlocks. But when levels of uncertainty and or distrust are high, deadlock can result. One party may indeed have a superior BATNA or firmly believe that no deal is better than the one being offered. But if the negotiator is unable to communicate these bottom lines credibly (partly because they have a reputation for lying, or because such claims go against all previous behaviour), the other party may understandably assume that he/she is bluffing and refuse to make any concessions. Narlikar (2010) argues that, a solution to the above if the central problem is uncertainty, negotiators can build in more effective communication mechanisms, which would facilitate the signalling of positions and interests. Institutions can play a role in this by establishing better transparency and monitoring mechanism. Hypothesis 3: Deadlock occurs because of certain types of balances of power. 3a: Deadlock is more likely, the more equal the power distribution 3b: Deadlock is more likely, the more the diverse the culture of the parties that constitutes the balance of power Narlikar (2010) posits that power matters crucially in the making and breaking of deadlocks. Negotiation analysis recognizes this: for instance, it has been pointed out that deadlocks occur if there is symmetry of power and neither party is able to impose its will on the other (Faure, 2005; Zartman, 2002). Beriker and Druckman (1996) also reiterate that deadlocks are more likely when the parties are symmetrically strong, but not when they are equally weak. According to Vitz and Kite (1970), it has however been found that
  31. 31. 31 mild discrepancies in power often leads to stalemate as stronger parties respond to the weaker party’s demand for equal treatment with escalatory tactics. According to Faure (2005) balance of power, at first glance can appear to be a structural constraint and thus one that negotiators might not have much agency over. However, balance of power can indeed be altered within specific institutional counter measures (such as rules that alter the relative weights of the participants), but also by the negotiators themselves through coalition building. Hypothesis 4: Deadlocks occur because certain institutional structures facilitate or deter agreement Bazerman et al (1995), stresses that certain institutional peculiarities can make a system more deadlocks prone. For instance some would argue that the consensus rule of the WTO is precisely what makes it prone to deadlock as it gives de facto veto power to all 152 members. In order to overcome, if the source of deadlock is a particular institutional process, members of the organization may be able to amend it (depending on the flexibility allowed by the institution), or at least find some wiggle-room by establishing new norms and working practices. Hypothesis 5: Deadlocks occur because fairness and justice matter According to Narlikar (2010), only a limited amount of previous research has been done to investigate the impact of fairness considerations on negotiations especially when fairness is defined in harder terms of going beyond and even against self interest of the parties. Bazerman and Neale (1995), argue that fairness considerations can lead negotiators to opt for joint outcomes that leave both parties worse off than they would have been had fairness considerations been ignored. If the problem is based on differing conceptions of fairness and legitimacy, then negotiators and analyst would need to give considerably greater attention to normative issues than they would have done until now. For instance, notions of victory would have to be framed carefully so that even the losing party can appear to show that it has won moral victory. Considerably greater attention would also have to be paid to how demands for concessions are framed.
  32. 32. 32 Hypothesis 6: Deadlocks occur internationally because of certain configurations of domestic interests Even when levels of trust are high and negotiation brimming over with good will, multilateral deadlocks can still occur due to presence of powerful domestic constituencies that don’t favour agreement. Certain types of negotiations and issue areas are more prone to the problem than others. For instance, obscure policy areas may not produce the same level of mobilization and resistance at home than others. Narlikar (2010) says if the primary source of deadlock lies at the domestic level inter- state negotiation may be inadequate, short of expanding the zone of agreement significantly so as to buy the approval of the dissenting constituencies of the negotiating counterpart. But the range of alternatives available to the state-level negotiator is broader than that. The negotiator may try to reframe the issue so as to win the domestic constituencies over, or s/he may expand the negotiating pie so as to trigger the support of alternative lobbies in favour of the agreement. For analysts and practitioners interested in analyzing and breaking deadlock, solutions depend on the cause identified as the main source of the problem. Sometimes, attacking the particular source of deadlock maybe the only route to a breakthrough. According to www.worksite.org you can try to avoid impasse by • Not giving management a firm rejection on proposals you mainly disagree with. Instead, stress that your position on individual items depends on the total package management is willing to agree to. • Continuing to make new proposals on controversial subjects, even if there is not a huge difference between your new positions and your old ones. • Insisting that management take the time necessary to prepare detailed information the union needs in order to bargain intelligently on proposals each side has made. • Not saying to management, your members, or the news media that you’ve reached the point where it is clear that management has no intention of settling. (You can say that so far they have not been willing to negotiate a fair settlement.) According to www.worksite.org, when little progress is being made and you want to get negotiations moving toward a settlement, some of the following techniques may be helpful:
  33. 33. 33 • Employ more pressure tactics. Your problem may not be a failure to communicate at the table but rather a failure to force management to want to settle. • Trade one or more items for one or more others. “We are willing to consider moving on X if you are willing to agree to our proposal on Y.” (Be aware that in saying this you are signalling that X is not a make-or-break issue for you.) • Group several issues into a package or present an entire proposed contract that contains some compromises by both sides. “We’ve developed what we think is a fair package, and we’re willing to accept the compromises in it if you accept the entire package.” • Make minor changes to save face for one side or the other. If one team is finding it hard to admit that it has to change its position on an issue, a relatively unimportant change in wording may allow them to say, “Well, with that change I think we can accept it.” • Suggest resolving an issue through a side letter rather than in the contract itself. A side letter is an agreement that is added on to the main contract. It is binding and can be grieved unless you have agreed that it can’t. Whether side letters must be specifically renewed when they expire depends on the understanding of the two sides during bargaining. If management officials are reluctant to break new ground on a controversial issue or to agree to special provisions for a particular group of workers, they may feel more comfortable using a side letter format to emphasize that the agreement is unusual or experimental. • Bring in a new face, such as a higher-level union official. If management officials are ready to settle but their relations with local union negotiators have become too strained, they may find it easier to settle with someone new. In addition, the presence of someone from higher up may remind management that the larger union stands behind this local. If a settlement is reached with the higher official’s help, it is important that the negotiating team be closely involved in considering and approving the tentative agreement. Like any settlement, it probably will involve both compromises and victories. The political heat for those compromises and the credit for those victories should be shared by a united union leadership. In the long run, members’ confidence in their union will be damaged if they see political division and jockeying among different levels of the
  34. 34. 34 union or if they view the settlement as something higher-level officials negotiated over the heads of their own negotiators. • Step up the pace of bargaining. This might mean meeting every day instead of once a week. Or it might mean using marathon bargaining sessions, in which negotiators agree to stay in session all day and all night if necessary to reach an agreement. This approach is supposed to help negotiators get into a rhythm of reaching agreement that will help them find solutions when they get to the toughest issues. It is also supposed to wear negotiators down, so that getting bargaining over becomes more important than the details of the settlement. For these reasons, high-pressure bargaining obviously will help you if management’s negotiators are the first to feel the effects, and will hurt you if your own team is the first to wear down or get in the mood of compromise. If you are going to engage in marathon bargaining, all members of the team who are going to be present should go into it well rested and without family conflicts that will make them too eager to reach a settlement. Nathoo (2000) agrees with the above and summarizes by highlighting the following points:  Patience during the process of negotiations confers bargaining power, while risk aversion affects it adversely  A player’s outside option enhances her bargaining power if and only if it is attractive and therefore credible.  A player’s Bargaining power is higher the larger is her inside option, provided that all negotiators’ outside options are not attractive enough  If both negotiators’ outside options are sufficiently attractive, then it is likely that gains from cooperation may exist (and the parties may thus prefer to exercise their respective outside options)  When both negotiators’ cost of backing down from their initial demands are sufficiently large, then making such demands may risk leading the negotiations into a stalemate  A player’s bargaining power is higher the larger is their cost of backing down from their initial demand
  35. 35. 35  When a party does not know something of relevance to the ongoing negotiations which the other party does, there is a risk of failure of negotiations or of costly delay till the relevant information is credibly communicated to the uninformed party.  Knowledge is veritable power in negotiations and enhances the bargaining strength of the better informed. The above views are also shared by Fisher and Ury, 1991, Narlikar, 2010, Krevynenyak 2002, Lax and Sebenius 1986, Raiffa 1982, Schelling 1960, Walton and McKersie, 1965 and Zartman, 1978. 2.5.0. COLLECTIVE BARGAINING Silva (1996) posits that collective bargaining is specifically an industrial relations mechanism or tool and is an aspect of negotiation, applicable to the employment relationship. As a process, the two are in essence the same and the principles applicable to negotiations are relevant to collective bargaining as well. However, some differences need to be noted. He further notes that in collective bargaining the union always has a collective interest since the negotiations are for the benefit of several employees. Where collective bargaining is not for one employer but for several, collective interests become a feature for both parties to the bargaining process. In negotiations in non-employment situations, collective interests are less, or non-existent, except when state negotiate with each other. Further, in labour relations, negotiations involve the public interests such as where negotiations are on wages which can impact the prices (Khabo, 2008, Okene, 2004 and Faruque, 2009) Narlikar (2010) in collective bargaining certain essential conditions need to be satisfied, such as the existence of the freedom of association and a labour law system. Further, since the beneficiaries of collective bargaining are in daily contact with each other, negotiations take place in the background of a continuing relationship which ultimately motivates the parties in the specific issues. The nature of the employment relationship between the parties in collective bargaining distinguishes the negotiations from normal commercial negotiations in which the buyer may be in a stronger position as he could take his business elsewhere. In the employment relationship the same employer is in a
  36. 36. 36 sense, a buyer of services and the employee the seller, and the latter may have the more potent sanction in the form of a trade union action. Silva (1996) points out that the term ‘bargaining’ implies that the process is one of haggling, which is more appropriate to a one time relationships such as the one-time purchasers of a claimant to damages. While collective bargaining may take the form of haggling, ideally it should involve adjusting the respective positions of the parties in a way that is satisfactory to all. www.fff.org.ph view collective bargaining as a process of negotiating an agreement regarding the terms and conditions of employment through a system of shared responsibility and decision making between labour and management. It has four essential elements which are: legal in that collective bargaining is a process of negotiating an agreement, economic in that its contents specify the terms and conditions of employment (e.g. salary/wage increase, benefits, etc), political in that the agreement is a product of a negotiation between labour and management and moral in that it involves a system of shared responsibility (www.ffw.org.ph). The International Labour Organization (ILO) right to organize and collective bargaining Convention (No.98), 1949 describes collective bargaining as voluntary negotiation between employers or employers’ organizations and workers’ organizations, with a view to the regulation of terms and conditions of employment by collective agreements. They further argue that collective bargaining could also be defined as negotiations relating to terms of employment and conditions of work between and employer, a group of employers or an employers’ organization on the one hand, and representative workers’ organizations on the other, with a view to reaching agreement. The same sentiments are shared by Lewis et al 2003. Lewis et al (2003) distinguishes between substantive terms which concern the content of employment terms, e.g. pay, bonus and hours of work. In other words these are the aspects of collective agreements that we would most readily recognize. Procedural terms of collective bargaining on the other hand, set out the rules and procedures to be used by both parties in regulating the conduct of the employment relationship and the bargaining arrangement.
  37. 37. 37 It can therefore be noted from the last two definitions that the authors agree that for collective bargaining to take place there is need for labour and management to come together to discuss and set and agree on conditions of employment. Broadly speaking therefore, collective bargaining is the umbrella under which the wage negotiation takes place. 2.5.1 CRITERIA FOR WAGE INCREASES According to McPhie (2006), the factors which have influenced pay increases through collective bargaining include enterprise profit, job evaluation, seniority, cost of living, manpower shortage or surplus, the negotiating strength and skills of the parties. He goes on to argue that these performance measures such as productivity or profit related to groups or individuals have not featured prominently in collective bargaining. Further, though wage rates negotiated through collective bargaining do reflect wage differentials based on skills, such differentials have not been geared to the encouragement of skills acquisition and application. Therefore, according to Silva (1996) the major concerns for employers is the need to negotiate pay systems which are  Strategic in the sense that they achieve strategic objectives  Flexible in the sense that their variable component can absorb downturns in business and reduce labour costs  Oriented towards better performance in terms of productivity, quality, profit or whatever performance criteria are agreed upon  Capable of enhancing earnings of employees through improved performance  Capable of reducing the incidence of redundancies during times of recession or poor enterprise performance through the flexible component of pay  Able to reward good performance without increasing the labour costs as part of total costs through enhanced productivity  Able to attract and retain competent staff  Able overall to control or stabilize labour costs
  38. 38. 38 2.5.2.0 MODELS OF COLLECTIVE BARGAINING Good negotiating is not about outsmarting, outmaneuvering or manipulating the other side. It is not about hitting (the other party) over the head and running off with the goodies before they know what hit them. It’s not about deception, omission or getting away with something. Foster (1992), points out that most of the time it’s not about one side having to give up something it needs in order for the other side to get what it wants. Nelson Mandela, one of the iconic figures of our time once said he attaches importance to dialogue, solving problems through negotiation. It is an art which requires a great deal of vision and strength of character. In the words of John F Kennedy in his inaugural speech as President of the USA in 1961, he advised that people should never negotiate out of fear, but let us never fear to negotiate. Khabo (2005) notes that conflict is inevitable in employment relations, however, what is important is how it is managed. The ideal situation is for parties to bargain voluntarily without third party intervention. According to Fisher et al., (1991) negotiations however sometimes fail. Where negotiations on any terms and conditions of employment have failed, there must be in place mechanisms to which aggrieved parties can resort to. Hence, the success of collective bargaining rests on the availability of efficient dispute resolution systems (Khabo, 2005). These shall be discussed a little bit later in the chapter. Below are some of the models of collective bargaining. As noted already these are not very different from the theories of negotiation. 2.5.2.1 DISTRIBUTIVE BARGAINING According to Mudyawabika (2003), this is when a win-lose scenario occurs where objectives of one party are in fundamental and direct conflict to the objectives of the other party. Resources would be fixed and limited and each party would want to maximize their share of resources and their success or otherwise will depend on the strategies that they use. The theory assumes a zero-sum game. Each party takes an extreme position and stubbornly holds onto it. It is also sometimes referred to as traditional or positional bargaining. Compromising is considered a sign of weakness. Each side puts forward its position to the other, then, once the positions are clear, the negotiation becomes a process
  39. 39. 39 of concession-making, whereby each side bargains with the other and compromises as little as possible to keep the negotiations going. A fixed pie approach is adopted. There is concealment or withholding of information, digging in. Exaggeration, misrepresentation, use of bluffs, threats manipulation, putdowns and other dirty tactics. The preparations for negotiations resemble a mobilization for war, differences are heightened, villains identified, weapons honed and war paint generously applied. Other have argued and said the result of this kind of negotiation is win-lose or lose-lose. 2.5.2.2 INTEGRATIVE BARGAINING In this case there is a win-win situation. The bargaining process is collaborative and based on assumptions that the parties are willing and able to cooperate in defining a common objective and working toward it. Negotiators look at both their interests as well as those of the other party. Parties are more concerned with future relationships than maximizing their positions. Process builds trust and strengthens relationships (Walton and Mckersie: 1991). Fischer, Ury and Patton (1991) talk of principled negotiation. Principled negotiation they say is premised of four attributes later expanded to seven.  Separate the people from the problem  Focus on interests, not positions  Invent options for mutual gains  Insist on using objective criteria In principled negotiation, parties get more of what they want the expanded pie approach. They do so in a collaborative climate, where relationships are established, where needs are met and where both sides walk away as winners. Negotiators are therefore joint problem solvers who seek solutions to mutual problems or issue of interest. Relevant information is shared between the parties. 2.5.2.3 ATTITUDINAL STRUCTURING Mudyawabika (2003) says that this is premised on the principle that the negotiation process has a significant impact on the relationship between the parties. Negotiation
  40. 40. 40 results in either the maintenance or the restructuring of the attitudes of the parties toward each other 2.5.2.4 INTRA-ORGANISATIONAL BARGAINING According to Mudyawabika (2003) these are internal organizational or party deliberations within an organization or party which are carried out with a view to taking common positions before engaging the other party in collective bargaining. It’s premised on recognition that the parties to negotiations often lack the internal consensus about the concerns, the strategies and/or tactics to be used and the relationship that should be developed with the other party. We now turn our attention at what levels the bargaining take place in the whole set up does. 2.5.2.5 BARGAINING LEVELS According to Gernigon et al., (2000) ILO Recommendation No. 163 provides that measures adapted to national conditions should be taken, if necessary, so that collective bargaining is possible at any level whatsoever, including that of the establishment, the undertaking, the branch of activity, the industry or the regional or national levels (ILO 1996d). Silva (1996) concurs with Gernigon (2000) and Khabo (2008) above and puts it that collective bargaining may take place at any of the following levels: a) National b) Single Employer c) Multi-Employer/Industry d) Regional or District Gennard and Judge (2005) concur with the above when they assert they are a number of bargaining levels available from which to make a strategic choice i.e. multi-employer level single employer level, enterprise level and a combination of all three above. However for purposes of this research a brief detail of the multi-employer level has been provided since it applicable to the NEC Catering Industry as it is in practice. Their bargaining is modeled along the same lines. Multi-employer bargaining has
  41. 41. 41 conventionally combined two levels- bargaining on the establishment of framework terms and conditions at Industry level with bargaining on the other matters left to individual companies. The actual distribution between the two tiers varies between industries and also changes over time. Company bargaining is where all terms and conditions of employment are negotiated at the central company level. Bargaining at this level enables pay and conditions to be related to the economic circumstances of the company as a whole and provides for standardized conditions across the company for similar jobs. In no country does it take place exclusively at one level only. According to Silva (1996), however, in many industrialized countries especially in Europe, the existence of strong employers’ organizations and trade unions have resulted in many important agreements being concluded at the national or industry level, supplemented by some enterprise level bargaining. In the USA, however, bargaining at the enterprise level has been the more usual practice, other than in specific sectors such as coal, steel, trucking and construction. Salomon (2000) defines multi-employer agreements as those being negotiated between Trade Unions and Employer Associations and covering employees of a given description in a specified industry or sub-industry. Until recently, national multi-employer bargaining was the dominant model in the UK and continental Europe. It affords both management and union’s significant advantages (Lewis et al 2003, and Silva 1996). The advantages to the employer include:  More concerted response to trade union organization  Reduces chances of employers competing with one another by wage and salary costs  Smaller employers do not have to spend time negotiating as it is done by experts  Reduces trade union role at the workplace The advantages that accrue to Trade Unions include:  Enhances bargaining strength  The negotiation of acceptable minimum standards for an industry’s employees  Increases chances of gaining recognition from new employers  Rationalization of resources  Demonstrable relevance to Industry employees thereby enhancing recruitment prospects.
  42. 42. 42 This is the model that is currently in application in Zimbabwe as provided for by the Labour Act (Chapter 28:01) as well as Statutory Instrument 167of 1991. 2.5.3.0 CONDITIONS FOR SUCCESSFUL COLLECTIVE BARGAINING 2.5.3.1 PLURALISM AND FREEDOM OF ASSOCIATION Silva (1996), points out that a pluralistic outlook involves the acceptance within a political system of pressure groups (e.g. religious groups, unions, business associations, political parties) within specific interests with which a government has dialogue, with a view to effecting compromises by making concessions. Pluralism implies a process of bargaining between these groups, and between one or more of them on the one hand and the government on the other hand. It therefore recognizes these groups as the checks and balances which guarantee democracy (Okene, 2004 and Khabo, 2008) 2.5.3.2 TRADE UNION RECOGNITION According to Okene (2004), the existence of the freedom of association does not necessarily mean that there would automatically be recognition of unions for bargaining purposes. Especially in systems where there is a multiplicity of trade unions, there should be pre-determined objective criteria operative within the industrial relations system to decide when and how a union should be recognized for collective bargaining purposes. Silva (1996) notes then, that the accepted principle is to recognize the most representative union, but what criteria is used to decide it and by whom may differ from system to system. In some systems the issue would be determined by requiring the union to have not less than a stipulated percentage of the workers in the enterprise or category in its membership (Gernigon et.,al 2000). This is the case in Zimbabwe 2.5.3.3 OBSERVANCE OF AGREEMENTS Gernigon et al., (2000), notes that in developing countries, unions are sometimes unable to secure observance of agreements by their members. Silva (1996) emphasizes that,
  43. 43. 43 where there is frequent non observance of agreements or understandings reached through collective bargaining process, the party not in default would lose faith in the process. 2.5.3.4 SUPPORT OF LABOUR ADMINISTRATION AUTHORITIES Faruque (2009) and Okene (2004) argue that support by the administration labour authorities is necessary for successful collective bargaining. They say this implies that they will: i) provide the necessary climate for it. For instance they should provide effective conciliation services in the event of a breakdown in the process, and even provide the necessary legal framework for it to operate in where necessary, e.g. provision for the registration of agreements ii) will not support a party in breach of agreements concluded consequent to collective bargaining iii) as far as is practicable, secure observance of collective bargaining agreements iv) provide methods for the settlement of disputes arising out of collective bargaining if the parties themselves have not so provided. 2.5.3.5 GOOD FAITH According to www.au.af.mil mutual trust comes from experience, either with the negotiation process or from previous contact. If it does not exist, it must be built. Collective bargaining is workable only if the parties bargain on good faith. If not, there will be only the process of bargaining without a result. According to ILO (1996) good faith is more likely where certain attitudes are shared among employers, workers and their organization, e.g. a belief and faith in the value of compromise through dialogue, in the process of collective bargaining and in the productive nature of the relationship collective bargaining requires and develops. Gernigon et al., (2000) points out that in preparatory work for Convention No. 154, it was recognized that collective bargaining could only function effectively if it was concluded in good faith by both parties; but as good faith cannot be imposed by law, it could only be achieved as a result of the voluntary and persistent efforts of both parties (ILO, 1981).
  44. 44. 44 2.5.3.6 PROPER INTERNAL COMMUNICATION ILO (1996) stresses that both management and unions should keep their managers and members respectively well informed, as lack of proper communication and information can lead to misunderstandings and even strikes. Sometimes managers and supervisors who are ill-informed may inadvertently mislead workers who work under them about the current state of negotiations, the management’s objectives and so on. 2.6.0 LEGAL STATUS OF COLLECTIVE BARGAINING Collective bargaining agreements have a unique status in the UK in that they are not legally binding on the parties who have signed them. If either the union or management acts contrary to the agreement, the other party cannot enforce its rights outlined in the agreement via Courts (Gennard and Judge: 1999). According to Towers (2003) between 1979 and 1997 successive conservative governments sought to reduce the collective rights of trade unions. Provisions to allow trade unions to claim recognition from employers were repealed, legal support for the closed shop removed and taking industrial action lawfully was made more difficult. However the election of the Labour government in 1997 marked a fresh approach to collective arrangements involving Trade Unions. In Zimbabwe however the situation is different. There are two main trade unions namely The Zimbabwe Congress of Trade Unions and The Zimbabwe Federation of Trade Unions. Employees are free to choose where they want to belong. All collective agreements reached and gazetted are enforceable via courts. The Labour Act (Chapter 28:01) recognizes collective bargaining at the workplace. Some of the sections of support of the above include Part II of the Act on Fundamental Rights of Employees on employees’ entitlement to membership of trade unions and workers committees. Section 6 of the act provides for protection of employees right to fair labour standards as well as section 7 where it’s advocating for protection of employees’ right to democracy at the workplace. Part 5 of the Labour Act on section 19 provides for advisory councils whilst section 20 empowers the Minister to stipulate minimum wages through statutory instrument. The Minister may, either on his own initiative or on the recommendation of any employer or employee of any association representing employers or employees, appoint advisory

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