Professor David Lipsky is a leading academic and researcher in the area of Collective bargaining and Dispute Resolution. He has been on the faculty of Cornell University since 1969 and has held various positions including Dean of the School of Industrial and Labor Relations and has served on the Board of Directors of The Industrial Relations Research Association.
This is the second part of an interview conducted for HR.com. Bolded lines represent questions posed by HR.com.
Since your discovery of the Narcotic and Chilling effect associated with the use of arbitration, has there been any contemporary developments to your theory?
It is funny you should mention that because we just completed a Labor Relations seminar in Chicago and my partner Johnathon Brock - The University of Washington wrote a report, technically speaking it was written by a task force appointed by the Secretary of Labor in the U.S., sometimes called the “Brock Report” it was through a task force appointed by the Clinton administration in 1994 it was like the public follow up to the Dunlop commission. The task force was charged with looking into the public sector. Anyway John was the Executive Director of that task force and basically he wrote the report even though they’re were a lot of distinguished people on the task force like Governor Florio from New Jersey and other people.
The bottom line is what John and his colleagues noted was that there was a lot of research in labor relations in the public sector in the 60’s and 70’s…but it seemed to fade away in the 80’s and 90’s as labor relations moved into other areas. So there was a research gap…where we just didn’t know… we had questions we had addressed and answered in the 60’s and 70’s but in the 90’s we just didn’t have the answers anymore. So John and I did this conference in Chicago to help fill our research gap and stimulate interest in public sector labor relations. So when you talk about the Narcotic and Chilling effect updates…we have a paper...but we really haven’t filled the research gap. For those of us who were around in the 60’s like Dave Luen, Tom Colkin who had done a lot of the early research were loathe to admit/concede that basically some of our worst fears about the Narcotic/Chilling effect have not come to pass. That over-dependence on mediation or any kind of arbitration just hasn’t seemed to develop over the last twenty years-- thus no narcotic effect. We had the former Chair of Public Employment relations Board of New York State, Pauline Consuela took up this point in discussion with us at the conference, and she noted that we have had compulsory arbitration in the case of police and fire disputes...and there was a wide spread feeling that if you had compulsory arbitration a Narcotic effect would develop and a lot of this is based on the experiences and findings from under the Railway Labor Act and some of it’s statutes… but the truth is, it is a rare year that they may reach 10 arbitration’s in New York State out of 100’s of units that may be negotiating.
Were you surprised?
No not really, because I had been following this for a number of years. But I think a number of people would be surprised where mandatory policies have been instituted that a chilling or narcotic effect hasn’t developed.
Do these effects apply in non-unionized use of ADR in the workplace?
I’ll tell you one thing we have run into, even from the employers that are very anti- ADR, is the feeling that if they put an ADR process into place that is open and accessible to any employee …all they are going to do is promote the free filing of claims and grievances. The feeling is that when people have a tool available to them, they make use of it and become dependent on it ... that is in a sense a narcotic effect…creating a lot of paperwork and administration in managing this additional area. But the experience that most employer’s report is that that doesn’t happen...in fact it is very much to the contrary...it appears that if you put a process in place, people don’t use it.
A grievance procedure in a non-union workplace gets put out as part of employee procedures and gets put out in things like employee handbooks and benefit packages etc, the HR office and council office may know about it...but the employees seem very reluctant to use it. They may think it isn’t capable of resolving their problems. It is anything but a narcotic effect…the theory that if you place a policy out there it will get over-used is an exaggeration.
One of my colleagues, Inkthab Ali has come to sit in on the interview. He is one of our managers and is in charge of our technology department. The next question when using ADR methods in the workplace, what are the legal implications and how do you minimize the possibility of lawsuits despite having an ADR system. i.e. Can a person, even if they agree to an ADR system, waive their statutory rights.
This is one of those issues that is still being looked at and hasn’t been totally resolved. Their is a court decision in the U.S. that immediately comes to mind and that’s the Gilmer decision -- It’s Gilmer vs. Interstate Johnson Wayne – Supreme Court 1991… and it arose in the securities industry, a stockbroker hired by the name of Gilmer - -worked for a brokerage house Wayne, and had signed an agreement basically stating he waived his right to sue his employer over any employment statutory claim and agreed that if he had an employment dispute it would be resolved ultimately by private arbitration. There came a time when Gilmer was discharge by Interstate, Johnson and Wayne and Gilmer claimed it was because of his age and it was a violation of the Employment Statute. The employer said you have to arbitrate this, and Gilmer said that this was a major violation and he wanted to go to the courts. Well the courts examined the case and said the statutory waiver that Gilmer signed was fine and they sanctioned that and the court said they were not going to interfere with that.
In the U.S. under the law that developed under collective bargaining, the Supreme and the lower courts have consistently followed a policy of deferment to arbitration. There is a major exception to that a decision made in 1974 Alexander vs. Gardner Denver, involving a black employee. The Supreme Court carved out a decision there to protect Civil Rights.
INKTHAB - That’s a gray area there…surely there has to be a great deal of exceptions to the rule based on extremes or degrees. Is that still a gray area in the U.S.?
Yes…As we speak there are a number of cases working their way through the courts right now. There is no consistent policy especially in non-union environments; it’s just not clear what direction we are heading there. At first glance the Alexander vs. Gardner case would appear to verify the decision not to interfere with collective bargaining agreements...but that was later looked at again. (Technically in the Alexander case it was not an employment agreement that was signed.)
Those things need still to be resolved…we appear to be moving in the direction of deference to private agreements…but who knows maybe with our next election we will see some movement there.
In your opinion what are the Pro’s and Con’s of interest based bargaining?
That’s a good topic...that’s one I take up with my classes. By interest based bargaining you are referring to the ideas brought up by Fisher and Ury? You know the book, Behavioral Theory of Labor Negotiations by Walton and McKersie? Well that school of thought is the one I relate to and it is different from the Fisher/Ury theory.
Walton and McKersie say there is both integrated and distributive bargaining. They recognize that sometimes you want to be an integrative bargainer and other tines a distributive one. Their prescription would be, a negotiator needs to figure out if he wants to be a hard Milton negotiator or playing a co-operative game. Sometimes in the same organization you may do a little of both. It depends on the circumstances, it depends on the framework it depends on the negotiators and a lot of factors.
I think Fisher and Ury incorrectly assume that it is always one or the other, rather that an integrated game. (Bob’s insight…affirmed by David Lipsky) This theory is missing the Political infringements that occur in bargaining and the managerial hierarchy factors.
Even culture has an impact, for example there are certain parts of the U.S. where I would never be an interest based bargainer – I’d lose my shirt – get my legs cut out from under me.
I think it is better if you can lead with Interest based negotiations if you can make it work… as long as the attitudes are constructive etc.
Technology has infiltrated many facets of business, and this is equally true in collective bargaining and dispute resolutions…what value do you see in these tools?
I see very great value...but I don’t see this as a black and white phenomenon, I think the fact is we have used technology, whatever ones have existed in the past, to assist us with dispute resolution i.e. telephone - a huge proportion of deals can be negotiated that way. The technology is used to assist in the process...you use technology when it makes sense to use it and you use face-to-face meetings when that makes more sense.
Whatever new technology tools we have we should utilize as it comes naturally i.e. e-mail etc. The adaptation of technology into any task is only integrated if it suits our purposes...if it doesn’t we don’t use it. SO, if it is convenient, affordable and it works...it will be used. “It is not the technology that drives the technique it is the technique that drives the technology.” Quote highlighted by Bob to utilize…
Bob - comment on Calculation tools where you enter a negotiation parameter and the tool spits out the equivalent cost…
I think some of those tools have been around for ages and I think a lot of companies have tons of accessible data through their chose of software that allow them to see the costs of any demand someone could make.
In major negotiations bargaining books are prepared in advance of negotiation usually...they use software to do that. We use it just in role-playing situations in class. I guess you could kind of say… “There was a technical revolution in bargaining that occurred and we never noticed it.”
Final Question - Outline the benefits to the Human Resources Professional of having an understanding of Labor Economics.
As a Labor Economist, I think knowing the economic reason behind things is important no matter what you do whether you are in HR or a truck driver. I think you develop a greater understanding and respect for the power of the market. You understand how much can be done just in reliance on the market.
Also it cautions you about trying to interfere too much and that policies and regulations and alike, will not be enough to overturn market forces.
You become alert to unintended consequences to policies and procedures that you are following in an organization. I think you develop a greater appreciation of no matter how abundant things appear to be...everything is scarce in the end. Everything becomes a matter of allocating in some effective or efficient fashion. And Economics teaches a lot of basic lessons in that regard.
This article was provided by HR.com.
HR.com(TM) is a website committed to making the lives of HR professionals and business managers easier. HR.com offers eight communities to address the specialties within human resources, including a section on Conflict and Dispute Resolution in our Labor Relations community. Within each community, users can access articles and research, find vendors/consultants, buy products or services and join discussion groups to learn from their peers.