Presenting Costs at the Bargaining Table

Whether you are a traditional quid pro quo negotiator or working in interest-based bargaining, costs are always going to be a consideration when getting a deal.  If a negotiator is able to demonstrate how little an employer proposal will change an employee’s take-home pay, or how detrimental a union proposal is to the employer’s bottom line, it can provide an objective reality check for both parties that can be far more persuasive than any speech at the bargaining table.  But how can you present your costs most effectively?

The number one rule, for as much pain as it might cause, is to be honest with your numbers.  While “fudging” the numbers a bit to either make your proposal seem more appealing or make the union’s offer more preposterous may be tempting, in the end it will come back to bite you, and could destroy the trust you have worked to develop with the union’s bargaining unit representatives.

The union’s negotiating team will know their bargaining unit’s needs and desires, as well as the issues their group is facing on a regular basis, so lying to them about facts is not going to get you far, and will most likely hurt your efforts in getting a deal.

 

However, this does not mean you can’t present your numbers in a best case or worst case scenario format based on the information you have.  As the employer, it is your money you are putting on the table, so you need to be prepared for the most expensive possibilities when agreeing to new language, and this is how you should present the data to the union.

For example, if a union proposes increasing the night shift differential for employees from five percent to 10 percent, how should you present the potential costs of making this change?  Do you present the cost based on average annual night shift hours worked by your employees, or on the maximum number of possible night shift numbers for an entire year?  You need to be prepared for the possibility of your company requiring manpower during nighttime hours, as those with public safety or water utilities cannot control when rioting or main breaks will occur.  You are completely justified in presenting the data based on increased work hours, and you’re being responsible financially, as you’ll be prepared for the potential costs of the change.  The last thing you want to do is be surprised at the end of the year when you’re millions over budget and still have work to be done.  Showing how extreme the increased costs could be can go a long way in getting a proposal off the table.

There is much more to discuss regarding the costing of proposals as well as presenting those costs to different parties.  If you would like to learn more, feel free to give us a call, or sign up to attend the MPELRA Summer Conference this August, in Duluth, where we’ll be presenting on total package costing and compensation.