The Pros And Cons Of Concession Bargaining
Concession Bargaining is a form of collective bargaining and a term used in labor laws. It is the opposite of other forms of union management bargaining where unions will demand something from management during negotiations. This is a form of collective bargaining used by unions to save jobs. During these types of bargaining the unions surrender or give back previously gained improvements in pay and condition in exchange for some form of job security. For example, employees may agree to give up wages or time off in exchange for protection against lay off or losing benefits. This kind of bargaining takes place during times of recession, when there is condition in the market and lays off are being given by management. The amount of trust the union has on management and credibility of management to the union affects the extent to which concession take place in bargaining.
These new ways of negotiations were created during the recession of the 1980s in search of ways to protect employment through collective bargaining. Unions were trying to stop further lay offs and secure jobs during recession and when there were lay offs by the company. These techniques are known as give backs or concession bargaining.
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Chrysler used the United Auto Worker (UAW) Concessions to negotiate more than $1 billion in long term federal government loans. Wage increases were deferred, employee paid benefits were reduced such as holiday, sick time, accident absences and pension funds. In return Chrysler gave the union a seat on the board of directors and no lay off guarantee. Employers were willing to agree to negotiate employment security at the high price of wages or benefits cuts. (p264) As the economy prospered concessions declined until anew era
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