Reference no: EM133369865

As your text notes, bargaining agendas are divided into monetary and non-monetary items. However, employers consider every bargaining item to be a monetary issue. It is also important to remember that there are few one-time costs in a collective agreement. Since the value of an employee's benefits is linked to his/her wage rate, even a small wage increase will automatically increase benefit costs. This helps explain why employers have in recent years sought to cap employee benefit costs. Since health care and defined benefit pension costs are often unpredictable, we see ever-increasing efforts (both union and non-union) to have workers cover a greater percentage of their health care costs through higher prescription dispensing fees, and higher co-payments. This is also why we see so many companies close down their defined-benefit pension plans in favor of defined-contribution plans such as 401K plans. Moving to defined contribution plans protects the employer from taking on high, uncertain legacy costs. Paying workers lump sums or bonuses rather than a percentage increase is another method of containing payroll costs. From a union perspective, moving more of the costs of benefits on to workers is a negative bargaining position. So too is paying workers lump sums or bonuses rather than percentage increases every year. Health and safety remain an ongoing issue in most workplaces.

Workforce demographics have a profound impact on bargaining agendas. Younger workers are more likely to be concerned with percentage wage increases and work flexibility, while older workers are more concerned with pensions and benefits. Unionized workers also tend to be older than non-union workers. Unions will eventually include younger workers as their current members retire. However, there is the potential for generational conflict within unions as older workers strive to maintain pensions and younger workers seek to find more flexibility and greater workplace compensation and recognition.

Given the environment, what two issues do you see as most important in negotiating a labor agreement? As part of your response, be sure to explain why the issues you selected are critical.