Management — Labor Cooperation

I’ve written more than a few posts on our current economic crisis from the standpoint of the workplace and employment law. I’ve suggested some ways to weather tough times. I’ve been highly critical of companies that use layoffs as their first and only option.

Steven Pearlstein writes about this as well in the Washington Post. Although much of his article focuses on law firm compensation in bad economic times (and any lawyer who reads this blog should take a minute to read Pearlstein’s wisdom on this subject), he begins by reporting on a deal reached between management and the Teamsters at the trucking company, YRC Worldwide.

The agreement is that union members will take a 10% pay cut in return for warrants that will allow them collectively to buy 15% of the company’s stock. Similar pay cuts will be given to nonunion employees, including executives. As Pearlstein notes, the Teamsters aren’t known for being pushed around, but union leaders decided that it was wiser and fairer to spread the current pain among workers than force layoffs and possible bankruptcy.

It is possible for management and labor to work together for a common purpose that’s good for everyone. Much has been made about a big change coming in the new Department of Labor. Organized labor believes that the Bush administration was way too pro-business. Business fears that the Obama administration will be way too pro-union.

As the somewhat unlikely example noted by Pearlstein demonstrates, it doesn’t have to be one way or the other. If there’s to be meaningful change in Washington, one way it could manifest itself is for the Department of Labor to do all it can, particularly during this economic crisis, to promote uncommon cooperation between management and labor for the common good.