HomeBusiness DigestThe pros and cons of bargaining

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The bargaining between an individual employee and the organisation will begin at the point at which an offer of employment is negotiated. The negotiation does not stop with the acceptance of the offer of employment; it continues at various levels throughout the employee’s tenure with the organisation. In some instances the negotiations may be unconcealed and quite perceptible, taking the form of strikes and other forms of industrial action.

 

The power balance between the employee and the employer is shaped by the external economic factors such as, among others, the availability of alternative employment and the economic outlook. The ongoing bargaining battles may also take subtle, under-the-surface forms.

The organisation expects the employee to be productive to the level perceived as commensurate with the remuneration paid;  the cost to the employer. The organisation’s negotiation power in pushing productivity is pursued through rewards and punishments associated with performance management, productivity bonuses and the linking of pay and performance.

The employee’s objective is, among other things, to get a good return on investment in respect of effort, expertise and labour that they put at the disposal of the employer. When times are good and jobs are a dime-a-dozen, employees easily vote with their feet; they leave for better prospects. In an economy such as ours, where the availability of alternative employment is but a pipe dream for an employee who does not possess  scarce skills, the astute employee maximises their negotiation advantage within the environment of their present job, which job they hold onto with dear life. Indeed the employee would endeavour to maximise the value of their current job.

An employee’s demand for their job to be  evaluated is driven by one prime motive; repricing of the job. A job is priced through the variation of the remuneration that the organisation pays the incumbent. The move to get an existing job evaluated from the individual employee’s perspective is about setting a higher price for the job; resulting in a higher salary, better benefits and all the other perquisites that come along with a higher grade. The economic consideration is prime for the employee.

The negotiating power of the employee, exerted through job evaluation request, would usually get a boost from organised labour ie the workers’ committee and or the trade union. These political forces usually lend their muscle power to the employee with a much bigger ulterior motive. Organised labour’s powers vest within the multitude; collectively and not at an individual level. However, they understand through times-gone-by that the easier way to get management to accede to a wholesome demand is by first tying them to set a precedence. Their feigned support for the individual’s claim is usually a wait-and-see game; crossing fingers that management would take the mistaken step into the precedence trap.

The management case is systemically weakened in the job evaluation bargaining process if a line manager “prostitutes” their fiduciary duty, subjectively taking the employee’s side. I am not being hard on line managers, rather I am reminding them of the role that they should play vis-a-vis the role played by the employee and their organised labour representative.

 

Ordinarily, the line manager should be objective in the whole process, clarifying the extent of the accountabilities and responsibilities of the job. This responsibility entails that the line manager will be the first to receive the request from the individual and be convinced about the request’s authenticity before passing it on to the human resources practitioners.

 

Try telling that to a senior leader who wants his favourite incumbent or secretary to be elevated to a higher grade, above other incumbents in similar jobs. The senior leader will tell the human capital department how the incumbent efficiently runs their office. Quick question to the Boss, “If indeed your personal assistant is now running your office to the extent that you allude to, why then should the organisation be employing you?”. Human capital practitioners will tell you that such a question is career limiting if the one at the receiving end is the chief executive officer or similar high power.

Indeed jobs do grow to the extent that a job evaluation becomes due. However, if a department is generally not growing, then due care should be taken to ascertain the source of a job’s growth.

 

It is important to clarify whether the job’s growth is organic or predatory. In organic growth, the job would grow to a level of handling tasks at an elevated delivery level, typical in instances where the output standards for the job are growing.

 

It is important to note that an organisation should pay for tasks that bring value to the organisation. Caution should be taken to guard against allowing a job to grow with tasks that have no value creation for the organisation; thus there should be a business need for the tasks that result in a job’s growth.

 

Predatory growth is a systemic political problem that should be weeded out; never to be rewarded in any way. Incumbents may decide to grow their own job empire by taking meaningful tasks away from others and laying a claim on them. The jobs predated on are essentially reduced in value, yet the organisation still pays a full measure of remuneration for them based on their initially agreed content.

 

Predatory growth may also be a result of other jobs abdicating their own responsibilities to a particular role, a phenomenon usually driven by the clash of personalities, which is clandestinely resolved through the “let-them-do-it” attitude from the incumbents that feel harassed. This results in the organisation paying double for the execution of one task, first to the initially assigned job role incumbent and secondly to the incumbent of the job role that grabs the abandoned tasks.

When incumbents are desperate for an upgrade of their job grade, they become creative writers, flowering the job description with the words they believe carry weight. General administrators would no longer describe one of their duties as “filing all documents appropriately”; rather the words would be along the lines of “managing the storage and retrieval of important organisational information”.

 

The CEO’s personal assistant would no longer “screen calls” but “strategically determine the appropriateness of in-coming communication requests, determining priority levels and delegating relevant officials to handle them”, all this signed and sealed by the CEO.

To all leaders, you may have a good reason to upgrade the salary of an individual. Such a reason maybe for the purposes of retaining an individual through a counter offer or as a precautionary measure to minimise the risk of a key incumbent looking for opportunities elsewhere. In most instances, the salary scales are restrictive in terms of a maximum remuneration that an individual on a particular job grade can be paid.

 

However, boosting a job description just to cater for a need to pay a particular individual more has a number of unintended consequences. Organised labour will pounce on the principles of consistency once a job similar to others is upgraded, causing a domino effect.

 

The organisation will not be able to effectively defend itself regarding the individual-centred decision because the accepted business practices state, “a job is evaluated and graded, not the incumbent”. It is important to note that once a job is so “upgraded” to cater for the individual, it would be difficult to right size it in future when the incumbent leaves. Organised labour would raise an alarm about the job being downgraded, as some internal candidates would be eyeing the job.

If indeed the need to pay someone more arises as a retention move, rather leave the job grade untouched. It would be manageable to give a remuneration premium that is attached to the individual. Once the individual leaves, the job grade would remain at the right level and the next incumbent will only get the extra remuneration premium only if the situation warrants that decision.

 

Remember, not everyone can claim to have scarce skills in an economy such as ours that has a good number of highly skilled unemployed people.

 

Sam Hlabati specialises in Systems Thinking and Reward Management. You can contact him on samhlabati@gmail.com.

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