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Accounting For Leaders
Vamshi Pratap Bokketi
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1
Background
Founded in 1903 by henry fond with other 11 associates
Common stock sold in 1956 for first time
It is shares are worth $ 10.86
Net income in 2019 was $ 47 millions
Selected ratios
Quick Ratio
Earnings per Share (EPS)
Asset turnover ratio
Debt-Equity Ratio
2. Quick ratio determines the ability of the company to pay off its
short term liabilities
Earning per share measures the money that each shares earned
during that financial period.
Asset turnover measures how much is being generated by
each assets in the company
Debt ratio measures the relative amount of a company’s
assets that are provided from debt
3
Selected ratios
Return on equity
Return on assets ratio
Interest coverage ratio
Operating margin ratio
Operating margin ratio compares the operating income to its net
sales to determine the efficiency
Return on equity determine the company`s efficiency at using
the equity to generate profit.
Interest coverage ratio measures how easy it is for the company
to pay all interest expenses
4
3. Current Ratio
CR = Current assets / Current liabilities
QR(2019) = 114,047 / 98,132 = 1.16217951
AND qr (2018 = 114,649 / 95,569 = 1.199646
Industrial quick ratio 1.04 and 0.89 for 2019 and 2018
respectively
5
Earnings per Share (EPS)
20192018Ford Motors 0.010.92Industry N/AN/A
Asset turnover ratio
A t r = Net sales / Average total assets
ATR(2019)= 155,900 /((258,537+256,540)*0.5) = 0.60534639
ATR(2018)= =160,338 /((256,540+258,496)*0.5) =0.622628
No industrial ratio available
Debt-Equity Ratio
DER= total liabilities / Shareholder’s equity
DER(2019) = 225,307/33,230 = 6.78022871
4. DER(2018) = 220,474/36,066= 6.11307
Industrial ratio 1.01 for year 2018, year 2019 is not available
This Photo by Unknown Author is licensed under CC BY-SA
Return on Equity (ROE)
ROE= Net income / Shareholder’s equity
ROE(2019) = 47 /33,230 =0.001414385
ROE(2018) = 3,677 / 36,066 = 0.101951977
Industrial values 5.4% for 2018, values for 2019 not available
9
Return on assets ratio
Return on assets ratio = Net income / Total assets
ROA (2019)= 47/ 258,537 =0.000181792
ROA (2018)= 3,677 / 256,540 = 0.014333047
Industrial values 4.1 % for 2018, values for 2019 not
available
Interest coverage ratio
Interest coverage ratio = Operating income / Interest expenses
5. ICR (2019) = 19,110/1,020 =18.73529412
ICR (2018) = 22,756 /1,238 = 18.3812601
Industrial values 2.67 for 2018, values for 2019 not available
11
Operating margin ratio
Operating margin ratio = Operating income / Net sales
For year 2019 = 19,110/ 155,900 = 0.122578576
For year 2018 = 22,756/ 160,338 =0.141925183
Industrial values 6% for 2018, values for 2019 not available
Areas of improvement
Return on assets is 1.4% while the industrial value is 4.1 for
2018. This is the place where improvements need to be made
EPS is very low for any industry. Any amount that is less than $
1 is very low bearing in mind this is an international company.
However, other ratios calculated above are good since they are
above the industrial ratios
REFERENCES
Hoffman, B. G. (2013). American icon: Alan Mulally and the
fight to save Ford Motor Company. New York: Crown.
Billstein, R., & Mazal Holocaust Collection. (2014). Working
for the enemy: Ford, General Motors, and forced labor in
Germany during the Second World War. New York: Berghahn
6. Books.
Journal, W. S. (2020, December 31). F | Ford Motor Co. Annual
Income Statement - WSJ. Retrieved from
https://www.wsj.com/market-
data/quotes/F/financials/annual/income-statement
Car Carriers, Inc. v. Ford Motor Company. (2015).
14
Thank you
15
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© 2017 Cengage Learning®. May not be scanned, copied or
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or in part.
7. 9–*
Chapter 9
© 2017 Cengage Learning®. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
© 2017 Cengage Learning®. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
9–*
Impasse Resolution Procedures Involving a Third-Party
NeutralImpasse
The point in negotiations at which the parties have hardened
their bargaining positions and no voluntary settlement of the
dispute appears likely.Mediation
Mediator: an individual with no authority to impose a
settlement, who uses persuasion and personal credibility to
facilitate the restarting of the bargaining process.
Federal Mediation and Conciliation Service (FMCS)
© 2017 Cengage Learning®. May not be scanned, copied or
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or in part.
*
© 2017 Cengage Learning®. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
9–*
Impasse Resolution Procedures Involving a Third-Party Neutral
8. (cont’d)Fact-Finding
A semi-judicial process used to gather facts and issue a public
report containing conclusions and recommended terms of
settlement.Interest Arbitration
Allowing a third party (arbitrator) to hear the bargaining
positions of the parties and make a final and binding decision
on what should be included in the agreement.
© 2017 Cengage Learning®. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whol e
or in part.
*
© 2017 Cengage Learning®. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
9–*
Exhibit 9.1 Some Relevant Criteria an Arbitrator May Use to
Decide
an Interest Bargaining Dispute
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duplicated, or posted to a publicly accessible website, in whole
or in part.
*
© 2017 Cengage Learning®. May not be scanned, copied or
9. duplicated, or posted to a publicly accessible website, in whole
or in part.
9–*
Interest Arbitration ProceduresConventional Interest Arbitration
The arbitrator considers each party’s settlement terms, and
accepts one party’s or fashions a compromise settlement.Final -
Offer Total Package (FOTP)
The parties present their settlement terms on all issues and the
arbitrator must choose one package to be implemented in its
entirety without alteration.
Final-Offer Issue-by-Issue (FOIBI)
Each issue is considered by the arbitrator rather than the whole
package.
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duplicated, or posted to a publicly accessible website, in whole
or in part.
*
© 2017 Cengage Learning®. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
9–*
Interest Arbitration: Critical Concerns Criticisms and concerns
about the use of interest arbitration:
Arbitrators tending to “split the difference” in making
decisions, resulting in extreme positions for the negotiating
parties.
Arbitration’s “chilling effect” on the incentive to reach an
agreement when it represents the possibility of gaining more
than can be gotten through negotiation.
Arbitration having a “narcotic effect” on the bargaining parties
10. as they come to rely on it.
© 2017 Cengage Learning®. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
*
© 2017 Cengage Learning®. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
9–*
Interest Arbitration Procedures (cont’d)Mediation-Arbitration
(Med-Arb)
A mediator serves to facilitate the bargaining process and is
also empowered to act as an arbitrator to settle the dispute.
© 2017 Cengage Learning®. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
*
© 2017 Cengage Learning®. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
9–*
Other Third-Party ProceduresArbitration-Mediation (Arb-Med)
Employs one third party to be both arbitrator and mediator, and
reverses the procedural order of med-arb.Tri-Offer Arbitration
11. Both parties and a neutral third party suggest
settlements.Double Final-Offer Arbitration
Each disputant submits two package proposals of roughly
equivalent value.“Night Baseball” Arbitration
Each side submits sealed final offers and written briefs
discussing the relevant issues.
© 2017 Cengage Learning®. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
*
© 2017 Cengage Learning®. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
9–*
The Use of Economic Pressure to Resolve Interest
DisputesUnion
Strikes
Economic
Unfair labor practice
Sympathy
Illegal Strikes
Partial and wildcat
Jurisdictional
Work Slowdowns
Boycotts
Primary
SecondaryPrimary Employer
Lockout
Use of nonunion personnel
Use of temporary replacement workers
12. Strike Responses
Use of permanent replacement workers
Acceptance of unconditional requests for reinstatement
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duplicated, or posted to a publicly accessible website, in whole
or in part.
*
© 2017 Cengage Learning®. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
9–*
Exhibit 9.2 Work Stoppages Involving 1,000 or More
Employees in the United States, 1947–2014
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duplicated, or posted to a publicly accessible website, in whole
or in part.
*
© 2017 Cengage Learning®. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
9–*
Exhibit 9.3 Conclusions from Research on Work Stoppages
Regarding the Likelihood of a Strike
© 2017 Cengage Learning®. May not be scanned, copied or
13. duplicated, or posted to a publicly accessible website, in whole
or in part.
*
© 2017 Cengage Learning®. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
9–*
Strategic Purposes of a StrikeTo resolve the union’s internal
problems
Remove tensions and release frustrations
Unify diverse factions within the union
Prepare members for a realistic bargaining outcome
Rally members over a bargaining issueTo show management the
union’s strength
Convince management of the credibility of the union’s future
strike intentions
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duplicated, or posted to a publicly accessible website, in whole
or in part.
*
© 2017 Cengage Learning®. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
9–*
14. Exhibit 9.4 Some Potential Strike or Lockout Costs and
Mitigating Actions
Potential Employer Strike or Lockout Costs
Lost sales revenue
Loss of customers/market share (temporary or permanent)
Continued fixed operating costs (e.g., utilities, taxes, rent,
maintenance, debt service)
Nonbargaining unit employee payroll costs
Recruitment, selection, and training costs for temporary or
permanent replacement workers
Shut-down and start-up costs
Negative publicity
Legal fees
Damage to bargaining relationship or co-worker relations
(temporary or permanent)
Increased stress level on managers, employees, and their
families
© 2017 Cengage Learning®. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
*
© 2017 Cengage Learning®. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
9–*
Exhibit 9.4 Some Potential Strike or Lockout Costs and
Mitigating Actions (cont’d)
Potential Employer Actions to Minimize or Limit Such Costs
Build inventory in advance of an anticipated strike
Notify customers and suppliers in advance of strike potential
15. and help arrange alternative sources to meet customer needs
Engage in a publicity campaign to inform the public (customers,
civic leaders, and employees) about company efforts to resolve
the labor dispute
Shift the struck work to other primary employer-owned plants
or outsource such work to other secondary employers
Continue business operations using some combination of non-
B.U. employees, B.U. employees willing to cross the union’s
picket line, and temporary or permanent striker replacements
Existence of poor product market demand serves to decrease
risk of market share loss and sales revenue
Purchase strike insurance or enter mutual aid pact with other
employers
© 2017 Cengage Learning®. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
*
© 2017 Cengage Learning®. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
9–*
Exhibit 9.4 Some Potential Strike or Lockout Costs and
Mitigating Actions (cont’d)
Potential Union or Individual Employee Strike or Lockout Costs
Loss of union members due to voluntary union membership
resignation or permanent striker replacement
Loss of wage income or employee benefits coverage
Loss of union dues revenue
Cost of strike benefits provided, if any
Costs of operating a strike (e.g., printing costs, legal fees,
16. picket-line supplies such as coffee, food, or medical aid)
Political cost to union’s leadership if strike isn’t won or won
‘‘big enough’’
Damage to co-worker (peer) relationships between strike
supporters and nonsupporters
Continuing personal debt payments (e.g., auto, home, credit
card, insurance, and telephone)
Increased level of stress on work stoppage participants, their
families, and communities
© 2017 Cengage Learning®. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
*
© 2017 Cengage Learning®. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
9–*
Exhibit 9.4 Some Potential Strike or Lockout Costs and
Mitigating Actions (cont’d)
Potential Union or Individual Employee Actions to Minimize or
Limit Costs
Ensure adequate membership support prior to initiating any
strike action
Solicit morale and financial support from outside organizations
(e.g., other unions, community groups, general public)
Increase individual savings rate in anticipation of income los s
during work stoppage
Work with creditors to delay or reduce monthly debt payments
Ensure adequate funding of union strike benefit fund
Engage in publicity to demonstrate the merits of union members
17. bargaining positions at issue in the work stoppage and the
effectiveness of strike efforts to impose added costs on the
employer’s ability to operate
© 2017 Cengage Learning®. May not be scanned, copied or
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or in part.
*
© 2017 Cengage Learning®. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
9–*
Exhibit 9.4 Some Potential Strike or Lockout Costs and
Mitigating Actions (cont’d)
Potential Union or Individual Employee Actions to Minimize or
Limit Costs (cont’d)
Recognize the potential effect of product market conditions
(e.g., high product demand increases an employer’s cost of lost
sales, a high level of market competition increases an
employer’s risk of market share loss in the event operations are
curtailed)
Recognize the potential effect of labor market conditions (e.g.,
a relatively low supply of qualified labor reduces the risk of
striker replacement)
Establish support groups for strikers and their families to help
maintain striker solidarity
Keep strikers informed about the progress of efforts to resolve
the labor dispute
Encourage a consumer boycott of the primary employer’s goods
or services
© 2017 Cengage Learning®. May not be scanned, copied or
18. duplicated, or posted to a publicly accessible website, in whole
or in part.
*
© 2017 Cengage Learning®. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
9–*
Reinstatement Rights of Unfair Labor Practice and Economic
StrikersUnfair Labor Practice Strikers
Can be temporarily but not permanently replaced.
Are not eligible for back pay lost due to the strike unless their
lost wages were directly due to the ULP.Economic Strikers
Can be temporarily or permanently replaced.
If permanently replaced, a striker has the right to be placed on a
preferential recall list (Laidlaw-Fleetwood doctrine).
Can return to work during the strike after making an
unconditional request for reinstatement.
© 2017 Cengage Learning®. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
*
© 2017 Cengage Learning®. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
19. 9–*
Unlawful Strike MisconductSerious Strike Misconduct
Acts of violence directed at managers, co-workers, customers,
suppliers, or the general public
Intentional destruction of private property (e.g., acts of
vandalism or sabotage)
Verbal threats intended to intimidate or coerce an individual in
the exercise of his or her lawful rightsHow Conduct Is Judged
Courts considered context in determining the severity of acts
(verbal abuse versus thrown objects)
© 2017 Cengage Learning®. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
*
© 2017 Cengage Learning®. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
9–*
Employee Picketing RightsState and Local Laws Restricting
Picketing
No picketing activities for unlawful or violent purposes
Limits on times when picketing can occur, noise level, and the
number and spacing of pickets
Truthful content and clear identification of the employer
involved in the dispute in picketing signsPrivate Property
Restrictions
No picketing if applied alike to all parties with access
Picketing is allowed if there are no other means to communicate
to the intended audience
© 2017 Cengage Learning®. May not be scanned, copied or
20. duplicated, or posted to a publicly accessible website, in whole
or in part.
*
© 2017 Cengage Learning®. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
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9–*
Balancing the Rights of Picketing Strikers
First Amendment
Free Speech Rights of Picketing Strikers
Employer
Property Rights
Labor Peace
Free Flow
of Commerce
Public Interests
© 2017 Cengage Learning®. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
*
21. © 2017 Cengage Learning®. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
9–*
Secondary StrikesSecondary Employer
An employer with no direct authority to resolve the labor
dispute.Business Ally
A secondary employer who:
engages in an activity (e.g., doing struck work) that supports
the primary employer during a strike.
has a high degree of interdependence with the primary employer
(e.g., captive supplier).
has commingled assets with the primary employer.
© 2017 Cengage Learning®. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
*
© 2017 Cengage Learning®. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
9–*
Union Picketing and the LMRASection 8 (b) (4)
It is an unfair labor practice for a union to pressure a neutral,
secondary employer into becoming involved in a labor dispute.
Informational picketing is allowed unless its intent is to cause
employees of a secondary employer to strike their
employer.Sympathy Strikers
Union employees who refuse to cross the picket line of another
union to carry out their assigned duties.
Sympathy strikers can be replaced temporarily or permanently if
22. no alternative to their refusal can be found.
© 2017 Cengage Learning®. May not be scanned, copied or
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*
© 2017 Cengage Learning®. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
9–*
Common Situs PicketingMoore Dry Dock Doctrine
Common situs picketing of secondary employers is lawful if:
The primary employer is operating on the work site.
Picket signs clearly identify the primary employer.
Picketing is conducted at locations in reasonable proximity to
the primary employer’s site operations.
Reserve Gate Doctrine
A union cannot picket at a gate reserved solely for the
secondary employer’s use as long as it has reasonable access to
the primary employer’s gate.
© 2017 Cengage Learning®. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
*
© 2017 Cengage Learning®. May not be scanned, copied or
23. duplicated, or posted to a publicly accessible website, in whole
or in part.
9–*
Common Situs Picketing (cont’d)General Electric Doctrine
Picketing is illegal at a gate designated by the primary employer
for use by a secondary employer if:
If the gate is used exclusively by the secondary employer.
If the secondary employer is not doing struck work.
The secondary employer’s work does not require a normal work
stoppage (i.e., plant-wide maintenance shutdown) for the
primary employer.
© 2017 Cengage Learning®. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
*
© 2017 Cengage Learning®. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
9–*
Product PicketingProduct Picketing
The picketing of neutral secondary employers who sell the
primary employer’s product or service.Limitations on Product
Picketing
Primary employer must be identified as target of picketing.
Picketing must focus only on the primary employer’s products
or services.
Picketing that effects a near total or total boycott (merged
product doctrine) of the secondary employer is illegal.
© 2017 Cengage Learning®. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
24. or in part.
*
© 2017 Cengage Learning®. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
9–*
Exhibit 9.5 Handbill Used at Shopping Mall to Influence
Shoppers
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duplicated, or posted to a publicly accessible website, in whole
or in part.
*
© 2017 Cengage Learning®. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
9–*
National Emergency Dispute Resolution ProceduresNational
Emergency Strikes
Strikes that threaten to have an adverse effect on the national
interestFederal Methods for Responding to National Emergency
Strikes
Presidential seizure or other intervention
Procedures outlined under the Railway Act
Procedures outlined in the LMRA
25. © 2017 Cengage Learning®. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
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*
© 2017 Cengage Learning®. May not be scanned, copied or
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9–*
Exhibit 9.6 National Emergency Dispute Resolution
Procedure under the LMRA
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duplicated, or posted to a publicly accessible website, in whole
or in part.
*
© 2017 Cengage Learning®. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
9–*
Key TermsMediationFact-findingInterest arbitrationFederal
Mediation and Conciliation Service (FMCS)Conventional
interest arbitration (CA)Chilling effectNarcotic effectFinal -
offer total package (FOTP)Final-offer issue-by-issue
(FOIBI)Mediation-arbitration Arbitration-mediation (arb-
med)Tri-offer arbitrationDouble final-offer arbitration
26. (DFOA)“Night Baseball” ArbitrationStrikePrimary
employerLockoutUnconditional request for reinstatementLegal
strikeIllegal strikeEconomic strikeUnfair labor practice
strikeWildcat strikeSympathy strikeJurisdictional strikeProtest
strikesGeneral strikePartial strikes
© 2017 Cengage Learning®. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
*
© 2017 Cengage Learning®. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
9–*
Key Terms (cont’d)Work slowdownStrike manualPreferential
recall listLaidlaw-Fleetwood doctrineSupersenioritySerious
strike misconductSecondary employerInformational
picketingBusiness ally Struck workSympathy striker“Hot cargo”
agreementCommon situs picketingMoore Dry Dock
doctrinePicketing between the headlightsReserve gate
doctrineGeneral Electric doctrineProduct picketingMerged
product doctrineHandbillingNational emergency strikes
© 2017 Cengage Learning®. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
*
27. © 2017 Cengage Learning®. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
8–*
Chapter 8
© 2017 Cengage Learning®. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
© 2017 Cengage Learning®. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
8–*
Administrative Issues
Contract Negotiations and Administration
Job Security and Seniority
Employee Training
Work Restructuring
Safety and
Health
Technological Change
© 2017 Cengage Learning®. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
28. *
© 2017 Cengage Learning®. May not be scanned, copied or
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or in part.
8–*
Technological Change and Job ProtectionTechnological Change
Involves the introduction of labor-saving machinery.
Produces changes in material handling and work flow.
Is a nonmandatory bargaining issue.Automation
Machines and automatic controls displace humans who formerly
did the same work.
Alters job characteristics and required skills.
© 2017 Cengage Learning®. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
*
© 2017 Cengage Learning®. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
8–*
Phases of Technological Change
Development
Phase
Resource Allocation
29. Phase
Implementation
Phase
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or in part.
*
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8–*
Phases of Technological ChangeDevelopment Phase
Choices are made about the design and configuration of the new
technology.Resource Allocation Phase
Organizational units’ claims for resources are
evaluated.Implementation Phase
The new technology is constructed, put in service, and modified
if necessary.
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*
30. © 2017 Cengage Learning®. May not be scanned, copied or
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8–*
How Unions Protect Job Interests from the Effects of
Technological ChangeNegotiating contract language.Lobbying
for or against government regulation and assistance
programs.Providing direct services to members to assist them in
adjusting to or coping with change.Becoming voluntarily
involved in the technology selection process.
High Performance Work Organization (HPWO)
Saves and creates jobs and is globally competitive
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duplicated, or posted to a publicly accessible website, in whole
or in part.
*
© 2017 Cengage Learning®. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
8–*
Positive Effects of Technological ChangeHigher productivity
that produces greater wealth with less effortThe elimination of
menial and dangerous jobsHigher wages and better working
conditionsShorter hoursIncreased skill levels that increase pay
and result in a higher standard of living
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duplicated, or posted to a publicly accessible website, in whole
or in part.
31. *
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or in part.
8–*
Negative Effects of Technological ChangeElimination and
deskilling of jobs that lowers pay and reduces job
securityDisplaces intellectual skills of human operatorsIncurs
higher capital investment requirementsIncreased productivity
results in market oversupply, causing product prices to
decreaseIncreases the capability for monitoring employee
activities and performance
© 2017 Cengage Learning®. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
*
© 2017 Cengage Learning®. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
8–*
Job Security and Personnel Changes
Job Security Work Rules
Job Content
Working Hours
Seniority
Wages
32. Training
Job Assignment
© 2017 Cengage Learning®. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
*
© 2017 Cengage Learning®. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
8–*
Plant Closures, Downsizing, and WARNWorker Adjustment and
Retraining Notification Act (WARN) of 1988
Covers employers with 100 or more employees.
Requires 60 days’ advance notice of plant closing or major
layoff involving one-third of the workforce.
Exempts firms in financial collapse and unforeseen operational
difficulties.
Has no designated agency to enforce the act; employees and
unions must sue their employer to recover damages.
© 2017 Cengage Learning®. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
*
© 2017 Cengage Learning®. May not be scanned, copied or
33. duplicated, or posted to a publicly accessible website, in whole
or in part.
8–*
Subcontracting, Outsourcing, and Work TransferSubcontracting
Contracting work to an outside vendor when the employer
cannot do all or part of the work or when the vendor can do the
work at a lower cost.Outsourcing
Contracting work that the employer does not do to an outside
vendor to reduce costs.Offshoring
Movement of work from a company location within the United
States to locations outside of the United StatesWork
Transfer/Relocation
Moving work to another facility or location.
© 2017 Cengage Learning®. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
*
© 2017 Cengage Learning®. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
8–*
Subcontracting and the LMRASubcontracting is not a mandatory
bargaining issue when:
It is motivated solely by economic conditions.
It is a common method of business in the industry.
It follows previous similar subcontracting practices.
It has no adverse impact on current bargaining-unit employees.
The union has been given the opportunity to bargain over
changes in subcontracting practices.
© 2017 Cengage Learning®. May not be scanned, copied or
34. duplicated, or posted to a publicly accessible website, in whole
or in part.
*
© 2017 Cengage Learning®. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
8–*
Subcontracting and ArbitrationFactors in Management’s Right
to Subcontract:
Presence and clarity of labor contract language concerning
management’s subcontracting rights
Established past subcontracting practices
History of prior subcontracting negotiations
The intended duration of the subcontracting decision
Employer’s business justification for subcontracting
Evidence of union animus in the subcontracting decision
© 2017 Cengage Learning®. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
*
© 2017 Cengage Learning®. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
8–*
35. Work RelocationEmployers do not have a duty to bargain over
relocated work if:
Performance of the relocated work is significantly different
from the previous location.
Labor costs were not a factor in relocating the work.
The union could not have offered significant labor cost
concessions to affect the relocation decision.Duty to bargain
over the effects of work relocation
Transfer rights, severance pay, pension rights
© 2017 Cengage Learning®. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
*
© 2017 Cengage Learning®. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
8–*
Work Assignments and JurisdictionJurisdictional Disputes
Occur When:
Two or more unions representing different bargaining units
claim work for their members.
Workers claim work that should be rightfully theirs has been
assigned outside the bargaining unit.
Workers within the bargaining unit disagree among themselves
over work assignment.
© 2017 Cengage Learning®. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
36. *
© 2017 Cengage Learning®. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
8–*
Exhibit 8.1 Example of a Work Jurisdiction Clause
© 2017 Cengage Learning®. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
*
© 2017 Cengage Learning®. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
8–*
Jurisdictional Disputes and the NLRBFactors considered by the
NLRB in resolving jurisdictional disputes:
Skills and work experience required to perform the work
Union certifications already awarded by the NLRB
Industry and local practices
Prior arbitration decisions
The employer’s desires
Cost effectiveness and efficiency in assigning the work to a
particular unit or craft
© 2017 Cengage Learning®. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
37. *
© 2017 Cengage Learning®. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
8–*
Work SchedulingFlextime
Allows an employee to start and finish work at his or her
discretion, as long as the specified total number of hours per
week or per day are worked and the employee is present at work
during a core-hour period.Compressed Workweek
Consists of four 10-hour work days with three days off each
week or eight 9-hour days and one 8-hour day permitting one
extra day off every two weeks.
© 2017 Cengage Learning®. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
© 2017 Cengage Learning®. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
8–*
Seniority and Personnel ChangesSeniority
An employee’s continuous service with the firm.
An objective measure that is readily determined.
Possessed by all employees covered by the contract.
Used to apportion out rights unrelated to job performance:
Benefit rights: eligibility for and scheduling of vacation time
Job rights: bidding on jobs, layoffs, shift preferences, bumping
38. during layoffs
Superseniority
Protects certain union officials from layoff to assure continuity
in the functioning of the union.
© 2017 Cengage Learning®. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
*
© 2017 Cengage Learning®. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
8–*
Alternatives to LayoffsVol untary leaveEarly retirementWorking
hours reductionRotating layoffsWork relocationJob sharingPay
freezesPay cutsWork rule changesNew productsNormal
attritionHiring freezes
© 2017 Cengage Learning®. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
*
© 2017 Cengage Learning®. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
8–*
39. Legal Issues Involving SenioritySupreme Court Decisions
Bona fide (lawful) seniority systems are permitted.
Employees can be awarded retroactive seniority as a remedy for
past discriminatory practices.
The use of seniority in layoffs is permitted where the layoff
may or does adversely impact minorities.
Reverse discrimination claims are not valid if the affirmative
action plan:
Is a negotiated settlement between the union and employer.
Does not harm majority employees (loss of jobs).
Doesn’t exclude majority employees from advancement
opportunities.
© 2017 Cengage Learning®. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
*
© 2017 Cengage Learning®. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
8–*
Americans with Disabilities Act (ADA)Reasonable
Accommodation
Requires employers to make adjustments to job for qualified
persons with disabilities who can carry out the essential
functions of the job.
Cannot conflict with other employees’ seniority rights.
Does not require the lowering of behavior or performance
standards.
© 2017 Cengage Learning®. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
40. or in part.
*
© 2017 Cengage Learning®. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
8–*
Types of Employee TrainingFormal Programs
Apprenticeships
New employee orientation
Safety and health
Basic skills
Job-specific skills
Workplace practicesInformal Training
On-the-job
Mentoring
© 2017 Cengage Learning®. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
*
© 2017 Cengage Learning®. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
8–*
Work RestructuringWork Restructuring Programs
41. Employee involvement
Worker participation
Cross-training
Multiskilling
Self-managed work teamsBenefits of Innovative Practices
Increased energy, creativity, and dignity for employees
Increase profits for employers
© 2017 Cengage Learning®. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
*
© 2017 Cengage Learning®. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
8–*
Safety and HealthFactors prompting the inclusion of safety and
health clauses in labor agreements:
The standards and provisions of the Occupational Safety and
Health Act (OSHA) of 1970
Emergence of new biological, ergonomic, and chemical hazards
in the workplace
Rising health care treatment costs
Increases in legal claims by injured workers
© 2017 Cengage Learning®. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
*
42. © 2017 Cengage Learning®. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
8–*
Key TermsTechnological changeAutomationEffects
bargainingHigh performance work organization
(HPWO)DeskillingPsychological contractJob
securityFeatherbeddingWorker Adjustment and Retraining
Notification Act
(WARN)SubcontractingOutsourcingOffshoringFibreboard
rulingJurisdictional disputesInstructional
situationsExperimental workEmergency
situationFlextimeCompressed workweekSeniorityBenefit
rightsCompetitive job rightsBumping rightsSuperseniorityJob
sharing
© 2017 Cengage Learning®. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whol e
or in part.
*
© 2017 Cengage Learning®. May not be scanned, copied or
duplicated, or posted to a publicly accessible website, in whole
or in part.
8–*
Key Terms (cont’d)Work sharingOrganizational
justiceDistributive justiceProcedural justiceInterpersonal
justiceInformational justiceAmericans with Disabilities Act of
1990Reasonable accommodationWork restructuringSemi-
43. autonomous work teamsSelf-managed work teamsOccupational
Safety and Health Act (OSHA)
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duplicated, or posted to a publicly accessible website, in whole
or in part.
*