• Subscribe

Bruniquel news and updates

News from the world of Bruniquel

WAGE NEGOTIATIONS – It’s that time again. Are you prepared?

Once upon a time there was a bear who was hungry and a man who was cold, so they decided to negotiate in a neutral cave. After several hours, settlement was reached. When they emerged, the man had a fur coat and the bear was no longer hungry!

Chester L. Karass:
The Negotiating Game.

These days every time when I turn on the radio on my drive to work, I hear of roads being blocked by service delivery protestors. Coupled with that, this year, we have had some significant developments on the political front. People are fed up and unfortunately for some employers, this is going to translate into high wage demands and intransigence at the negotiating table.

Unfortunately poor negotiating and bad decision making by mine management saw AMCU’s stonewalling tactics pay off. Numsa seemed to adopt a similar stance last year and it will not surprise me if we see unions adopting similar tactics again this year.

So how do employers prepare for this year’s round of negotiations?

Do your homework

15658274._SY540_

“If you know the enemy and know yourself, you need not fear the result of a hundred battles. If you know yourself but not the enemy, for every victory gained you will also suffer a defeat. If you know neither the enemy nor yourself, you will succumb in every battle.” 

To win without fighting is the best of skills.

Sun TzuThe Art of War

Parties enter negotiations with view to reaching resolution on changes to wages and terms of employment. The real issues however, which are concerning workers are sometimes never put on the negotiating table. These issues often relate to how employees are managed on a day to day basis. For many people they also are based in real concerns about how they are to make ends meet, given the extended families they support.

The cost of living keeps going up, government bureaucracy and the weakening rand make it harder and harder for businesses to make a profit. Workers often simply do not understand that investors need a return on their investment or they take their money elsewhere.

When one looks back at the Marikana tragedy and the Platinum strike, it is obvious that although wages were a key concern, there were underlying problems which management failed to address. Clearly management had not done their homework properly.

Positive workplace relationships

The key to successful negotiations is to develop positive employee relationships. This is an everyday management responsibility which goes well beyond simply maintaining discipline at work. Managers need to take the trouble to really get to know their people and to LEAD them. If they do this, they will pick up issues long before they become a problem. For example, do employees actually understand how the business works?

Sense of entitlement

There is a sense of entitlement in South Africa which stems from ignorance. Employers often miss the point that employees need to understand the basics of how the business works. Employees need to be empowered to understand profit and loss, why customer relations and cost control are so important to a business and how they as individuals fit into the big picture. Every job is important but sometimes employees simply do not see how they fit in and how they can contribute. They therefore do as little as they can to get by and stay out of trouble. Training in Employee Business Appreciation and in Customer Relations can address this problem.

Transparency and consistency

In order for people to appreciate what is going on so that wage negotiations can achieve win-win outcomes, there must be transparency. However, this is only possible if employees understand what is possible and what is not possible – a business can only pay so much. This requires that management act with integrity and consistency so that there is trust. This means that management must be consistent in the way that they conduct negotiations. A final offer must be FINAL. If not, management credibility goes out of the window.

That is why it is so important to properly define the mandate before negotiations and to be prepared to sit out a strike if demands go beyond the mandate. Caving in to pressure just leads to more demands and more radical behaviour. One should remember the words of Winston Churchill in this regard:

Appeasement is trying to feed the crocodile in the hope that he will eat you last!

Discipline

Strikes seldom take place in an environment where there is discipline. But discipline is NOT all about punishment. It is about creating an environment where people understand the need for the rules are self-discipline and willingly comply with rules.

Managers need to become aware of the important role they play in getting employees to understand the need for rules so that there is willingly compliance with the rules. Disciplinary training should not focus only on disciplinary enquiries but more importantly, on creating positive relationships and corrective measures so that dismissals are rare and are never lost at the CCMA.

Debt

One of the biggest problems we have in South Africa is employee debt. Most employees who are in debt are stressed and unhappy. Many have garnishee orders against them and they seek cash advances or loans, sometimes even resigning in order to get access to their Provident Fund contributions.

These employees are also likely to go along with radical wage increase demands and to vote to strike in support of them because they have nothing to lose.

While it is each employee’s responsibility to manage his or her finances, employers need to be aware of this problem. If it is an issue for a number of employees it might be necessary to arrange life skills training in managing personal finances. Such training needs to focus on why they got into debt into the first place. Money Wise is an excellent training programme to address this problem.

Productivity

In 1973 I worked for a well-known international company whose wages and conditions of employment were among the best in Durban. At that stage, the company’s minimum wage was R14 per week, in contrast to the R7.00 per week paid by the company where the Natal strikes started. My employer, being pro-active and forward thinking, was one of the few companies to avoid a strike by negotiating a wage increase with its ‘African Advisory Committee’. The company doubled their minimum wage to R28.00 per week. What was really interesting was that for the next three years, the company posted record profits!

Now I am not suggesting that companies should double their wage bills. Not at all, but it is very easy to become complacent about these things. For example, I have often heard people claim that you must not pay employees in an area more than the norm because “You will spoil them and spoil it for everyone else!”

If bosses (particularly public sector bosses) can be paid huge salaries combined with exorbitant bonuses, we should not be surprised when workers react angrily to increases of five and six percent on what is in most cases, a low base anyway. If we continue to treat our people as second class citizens, we deserve everything we get!

The answer is to raise our expectations. Expect, nay, DEMAND greater responsibility and PRODUCTIVITY from workers and pay them a decent salary or wage! We must stop tolerating poor performance and unacceptable conduct in the workplace. Make people EARN a decent living.

Bruniquel & Associates (Pty) Ltd

For more information please click here.