Negotiations Bargaining and Advocacy

Negotiations Bargaining and Advocacy

Overview:

The purpose of this assessment is to provide students with the opportunity to gain experience in conducting negotiations. A discussion board facility on vUWS, will be the primary vehicle for these negotiations, although negotiations within each negotiation group can supplemented by using some other method (e.g. face to face meetings, or social media platforms). The actual context of the negotiation concerns negotiations between management and a union in a financial services industry setting. Management and the union are seeking a new enterprise bargaining agreement (EBA). Negotiations are underway and the objective of the current negotiation is to reach agreement on three provisions that still require resolution. In the federal jurisdiction there is no definitive requirement that parties reach an agreement when engaged in negotiations, although there is a requirement to bargain in good faith. For the purposes of this assessment there is a requirement that an agreement be reached by the specified date. Ideally, each party should get the best possible agreement to satisfy their concerns, priorities and interests.

Management and union negotiation groups will be established and matched in Week 6 tutorials. There will be a maximum of 3-4 students in each management negotiation group and each union negotiation group. It is highly preferable that members of a negotiating group are drawn from the same tutorial. Once the groups are established, details will be provided of the appropriate vUWS infrastructure for each set of management-union negotiations. De- tails concerning the use of vUWS will be posted onto the website for this unit. There are no specific roles within each management or union group, but if you wish you may decide what roles you want your negotiating group members to have: for example, human resource manager, reward analyst, union state secretary, union organiser.

Background information is provided in this learning guide and specific management and union briefing notes will be provided to the management and union negotiating groups. In developing an activity such as this it is not possible to cover every eventuality but it should not be necessary to add or make up further background or contextual material. Remember that the main objects of this assessment is to develop your negotiation skills, and an ability to negotiate in a team. Students are encouraged to research the issues that require resolution in this negotiation and to bring to the negotiations the results of this research. This may include, for example, clauses from other workplace agreements. These can be accessed through the agreements tab on the Fair Work Commission site [ https://www.fwc.gov.au/]. A number of relevant agreements are provided on the unit’s vUWS site.

Context

The negotiation is based on a banking services workplace (Resolute Bank Pty Ltd) that has a number of banking operations throughout Australia. The bank has been in operation for more than 60 years and sees itself as a significant figure in the sector; in terms of its operation it rivals a medium to large financial services organisations. Resolute Bank Pty Ltd competes with other financial organisations in terms of securing and retaining skilled labour. The agreement will cover all of its Australian workplaces. Resolute Bank Pty Ltd is generally viewed as being a ’good employer’ but at the same time is aware of the pressures of the market place.

The bank has historically paid in excess of the award rate and will continue to pay rates in excess of the award rate, as determined by the Fair Work Commission. Its rates of pay need to be sufficiently attractive to ensure the retention of employees but in these negotiations the employer is also seeking to ensure that any wage increases contained in the agreement do not add to its operating costs. The Commerce Union of Australia (CUA) is the only union involved in the negotiations. The CUA represents all the employees, with the exception of senior managers. This union is one of the larger unions in the country and represents a wide range of financial services sector workers. The employer has respect for this union, seeing it as fairly representing its members’ interests in a constructive manner and in any event the employer is aware of the provisions of the Fair Work Act that concern bargaining in good faith (s.228). This agreement to be negotiated is a new enterprise agreement (s.172), to replace the current enterprise agreement. The bank has had agreements with the union for the last 30 years, and its preferred strategy is to continue that relationship. Both parties are also aware that Fair Work Commission will not approve the agreement if it does not meet the ’better off overall test’ (see s.186, s.187).

For its part, the union recognises the bank’s commitment and values it. However, both management and union negotiators know that the best bargaining position is to bargain from a position of strength and ensure that the needs of their respective constituencies are met. There are about 4,000 employees to be covered by the agreement. Women comprise sixty five per cent (65%) of the workforce. Twenty per cent (20%) of the workforce is employed on a permanent part-time basis. Somewhat unusually the bank’s use of casual employment is low for the sector (about 15%). There are no plans to outsource work. Union membership is about forty per cent (40%).

Background to these negotiations

Despite onset of COVID-19 in 2020, the bank is profitable but there is strong competition in the market place. The current negotiations to renew the enterprise agreement have been proceeding for six months. Agreements have been reached on a wide range of issues – working hours and staff rosters, the taking of annual leave, meal breaks and parental leave, casual employment, and learning and development. The agreement will be a two-year agreement (i.e., the nominal expiry date will be June 2023). Only three provisions are left to be resolved. Both parties feel the need to ’wrap this one up’ and finalise an agreement.

For the purposes of this assessment the provisions to be negotiated revolve around important issues of principle and it should be possible to negotiate and reach agreement without delving too much into the intricacies of banking services. Thus online negotiation participants should not have to ’make up’ lots of so-called facts in order to reach an agreement.

Provisions to be negotiated:

(2) Pay (wage and salary) increases. Pay increases for employees during the last three EBAs (i.e. since 2013) have been between two and three per cent (2%-3%) per annum, while the rate of inflation (increase in the costs of living – CPI) has averaged 1.9% each year since 2013. Before the onset of COVID-19 in 2020, the Reserve Bank of Australia was forecasting inflation to continue to increase by about 1.9% per year till 2023. It will be necessary to agree upon the size of the pay increase, as well as the basis of that increase. Pay increases of about 2% per annum in the new EBA will mean employees will not have an increase in ’real wages’ during the life of the new agreement.

QUESTIONS TO BE ANSWERED:

As you as the union have been making a negotiation  based on the pay increase for your company the employer have put forward a response to your proposal you will now need to look over the scenario and the propositions of what the employers have come with and give a final answer in order to negotiate and come to an agreement with the employer – this has been attached as a PDF to show the employer and union communication based on the negotiation on pay increase  – please Fair trading website

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