Enterprise bargaining: planning and preparation works best


 Although it’s attracted more than its fair share of attention, Qantas is not the only organisation involved in enterprise agreements that have come up for renegotiation this year. It’s been a busy year for many companies, mine included, with a relatively new set of rules and awards under the Fair Work Act to deal with.

Regardless of the laws in operation, my experience as a HR General Manager in the construction industry has convinced me that careful planning and preparation can lead to better control of the process and better outcomes. The following fifteen steps are not foolproof but, by and large, they’ve worked well for me:

  1. Devise a plan to avoid nasty surprises.
  2. Use the relevant Modern Award as a starting point
  3. Identify which issues and parts of the business are impeding productivity, customer service, etc and need to be improved. Consult with line managers and actively encourage feedback from them. Remember that these managers are the people who will have to implement any changes.
  4. Keep it simple. For example, a dispute resolution clause should only cover matters contained in the agreement otherwise “management prerogative” issues tend to be dragged into the process. Best to avoid including clauses on bonuses because you might be stuck with them.
  5. Write down proposed changes and prepare scripts that set out your position. For example a table could set out the existing clause, a proposed new one, the reasons for making the change and your fallback position if it’s rejected (e.g. continue as before, rely on the award clause or try to negotiate a compromise).
  6. Analyse all stakeholders in a table, listing their aims and motives. For example, what they want, the company’s position on the issue, and its fallback position.
  7. Select a negotiating team, assigning specific roles and scripts. Try to keep the team “local”.
  8. Engage directly with your people, both to build trust and prepare them for the changes by, for example, improving their knowledge of how the business operates and what shape it’s in.
  9. Set a bargaining period and schedule meetings, allowing sufficient time for difficult meetings and complex issues.
  10. Set guidelines for the conduct of meetings (e.g. one speaker at a time) which should take the “good faith” requirements into account.
  11. Develop, communicate and get agreement on an overall intent and rationale for the process (e.g. continuity, improving productivity, fairness, etc). Use this to re-focus negotiations whenever discussions start to veer off the topic.
  12. Look for early wins, rather than tackling the difficult issues first-up.
  13. Document all meetings, agreed clauses and key developments, with copies sent to everyone involved. Keep employees informed of developments.
  14. Follow-up to ensure that line managers implement agreed changes promptly.
  15. Review the process afterwards the negotiations are over. How well did it go, what could be improved?

When should negotiations talk about the money? My recommendation on this question is that with complex negotiations it’s best to deal with most other issues before you mention money. That’s not a hard and fast rule, however. There are occasions in which you might end up bargaining away too many other items on your agenda before you get to money, and have less flexibility at your disposal than you want when you get there.

I’d be interested to hear about other experiences and negotiation techniques.

Ian Hedges (FCPHR) is General Manager of People at the large heavy building materials company, Hanson. This is an edited version of an AHRI seminar presentation he gave on 29 November in Sydney.

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I would add one significant thing to remember – don’t expect ‘giving-in’ on an issue or making a gesture of an offer will elicit similar responses from the other side. I have seen people give away the moon for nothing in return.
If you do want to get some items off the table, then you might consider tying issues together e.g. ‘I’ll give you this in return for that’, whilst making clear the deal isn’t a deal until its completely concluded.

More on HRM

Enterprise bargaining: planning and preparation works best


 Although it’s attracted more than its fair share of attention, Qantas is not the only organisation involved in enterprise agreements that have come up for renegotiation this year. It’s been a busy year for many companies, mine included, with a relatively new set of rules and awards under the Fair Work Act to deal with.

Regardless of the laws in operation, my experience as a HR General Manager in the construction industry has convinced me that careful planning and preparation can lead to better control of the process and better outcomes. The following fifteen steps are not foolproof but, by and large, they’ve worked well for me:

  1. Devise a plan to avoid nasty surprises.
  2. Use the relevant Modern Award as a starting point
  3. Identify which issues and parts of the business are impeding productivity, customer service, etc and need to be improved. Consult with line managers and actively encourage feedback from them. Remember that these managers are the people who will have to implement any changes.
  4. Keep it simple. For example, a dispute resolution clause should only cover matters contained in the agreement otherwise “management prerogative” issues tend to be dragged into the process. Best to avoid including clauses on bonuses because you might be stuck with them.
  5. Write down proposed changes and prepare scripts that set out your position. For example a table could set out the existing clause, a proposed new one, the reasons for making the change and your fallback position if it’s rejected (e.g. continue as before, rely on the award clause or try to negotiate a compromise).
  6. Analyse all stakeholders in a table, listing their aims and motives. For example, what they want, the company’s position on the issue, and its fallback position.
  7. Select a negotiating team, assigning specific roles and scripts. Try to keep the team “local”.
  8. Engage directly with your people, both to build trust and prepare them for the changes by, for example, improving their knowledge of how the business operates and what shape it’s in.
  9. Set a bargaining period and schedule meetings, allowing sufficient time for difficult meetings and complex issues.
  10. Set guidelines for the conduct of meetings (e.g. one speaker at a time) which should take the “good faith” requirements into account.
  11. Develop, communicate and get agreement on an overall intent and rationale for the process (e.g. continuity, improving productivity, fairness, etc). Use this to re-focus negotiations whenever discussions start to veer off the topic.
  12. Look for early wins, rather than tackling the difficult issues first-up.
  13. Document all meetings, agreed clauses and key developments, with copies sent to everyone involved. Keep employees informed of developments.
  14. Follow-up to ensure that line managers implement agreed changes promptly.
  15. Review the process afterwards the negotiations are over. How well did it go, what could be improved?

When should negotiations talk about the money? My recommendation on this question is that with complex negotiations it’s best to deal with most other issues before you mention money. That’s not a hard and fast rule, however. There are occasions in which you might end up bargaining away too many other items on your agenda before you get to money, and have less flexibility at your disposal than you want when you get there.

I’d be interested to hear about other experiences and negotiation techniques.

Ian Hedges (FCPHR) is General Manager of People at the large heavy building materials company, Hanson. This is an edited version of an AHRI seminar presentation he gave on 29 November in Sydney.

1
Leave a reply

avatar
100000
  Subscribe to receive comments  
Notify me of
Steve Champion
Guest
Steve Champion

I would add one significant thing to remember – don’t expect ‘giving-in’ on an issue or making a gesture of an offer will elicit similar responses from the other side. I have seen people give away the moon for nothing in return.
If you do want to get some items off the table, then you might consider tying issues together e.g. ‘I’ll give you this in return for that’, whilst making clear the deal isn’t a deal until its completely concluded.

More on HRM