Drapers Company and Trade Union’s Negotiations

The intentions of the management

The management of Drapers intends to introduce the following changes:

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  1. Increase in the working week (45 hours). This new policy will contribute to the increased productivity of an enterprise and bring extra revenues to the workers. Additional five workers’ hours will bring ¬£75 per week into households. Currently, the company cannot afford to pay overtime, and a 45-hour week will be a suitable solution for the company and the workers.
  2. Single-status pay and conditions. The change is necessary for the reduction of turnover among part-time employees, who now find themselves in a very underprivileged position. Currently, these people are not eligible for sick leaves and pension schemes. By establishing single status pay and conditions, the management will encourage these people to remain with the company.
  3. Profit-related payment scheme. The compensation paid to the employees will be closely related to the financial performance of the company within a certain period. This policy will provide an incentive for the workers to increase the volumes of production.
  4. No paid closure weeks;
  5. Development of flexible working arrangements and generic work descriptions. The employees will be transferred from one department to another. This strategy will enable the company to avoid such danger as a shortage of labor force. Secondly, this approach will enable workers to acquire a wide range of skills.
  6. Work during holidays such as Christmas and Easter. Currently, the company frequently stops its operations during holidays, and under the circumstances. Instead, the company will offer extra time off for holiday allowance.
  7. The compensation package for the employees will be determined on a three-year basis. This change is aimed at making compensational policies more transparent. Furthermore, it is supposed to improve retention rates among full-time employees.
  8. New sick pay scheme. The first three days of sickness will be unpaid, yet, the workers will receive compensation for the following four weeks of time off. The company is also intending to establish a new cumulative paid sickness period. Each worker will gain one extra paid day after 10 years of service.

The changes are essential, not essential not only for the very survival of Drapers but for the well-being of workers as well. At the given moment, the company has to cope with such difficulties as an economic downturn, increasing operational expenses, and declining profitability of the business. They will enable the company to achieve the following objectives. At this point, it is necessary to mention that in the future the company will not conduct negations with trade unions on a separate basis.

The counter-offer of trade unions

It is quite probable the representatives of the trade unions will make several counter-offers.

  1. In particular, they are most likely to object to a 45-hour week. They may suggest that it should be reduced to forty-three or forty-two hours. The question can be discussed only the union representative will raise it.
  2. The union will also insist on slightly higher compensation offered to the employees. The company can make some concessions to trade unions. Yet one can say that increase in working hours will inevitably lead to a pay rise for workers.
  3. The union workers can object to generic work descriptions and flexible work arrangements. This may also be perceived as an attempt to infringe on the rights of workers. Hence, the management negotiating team should explain that these models are adopted in many automotive companies and such practice can only contribute to better performance rather than harm the workers.
  4. Lack of paid sickness leaves for temp workers. This question is not negotiable since the company intends to establish the same pay and work conditions for the workers, irrespective of their status. Yet, one should note that the company will look for new full-time hires among its temporary staff.

References

Shelley S. & Calveley M. 2007. Learning with trade unions: a contemporary agenda in employment relations. NY: Ashgate Publishing.

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