ALT-1 Why Labor and Management need to Bargain in Good Faith
In a corporate landscape, every employer’s main interest is to safeguard his investment and maximize his wealth. On the other hand, employees want to have a more stable and better job experience - in terms of compensation, benefits and management policies.
Oftentimes, the interests of the two parties – the employer and the employee, contradict. Such scenario can negatively impact the business and can result into major blows against the firm. For that reason, it is important not to sign an employment contract unless the stipulations are clear. It is also advisable to enter into aCollective Bargaining Agreement(CBA) with employers.
CBAs are necessary in order to maintain a harmonious relationship between the employer and the employees.
Nevertheless, both parties should negotiate in good faith in order to avoid further altercations that will disrupt business operations. Negotiating in good faith has been a major concern in corporate America. The sincerity of the employers and the management are huge issues when negotiating with labor unions.
Despite the legal and moral consequences of not acknowledging the stipulations entered into a CBA, some employers still commit the said illicit acts. For that instance, the following are several reasons why employers and management mustcontract in good faith.
1) To avoid counterproductive labor strikes and protests
The most obvious reason why employers must abide by the stipulations of a CBA is that noncompliance to the stipulations therein will result into an outcry among employees.
It will result into labor strikes and protests that are counterproductive to the business firm. Labor strikes and protests will disrupt business operations. Thus, the business firm is bound to suffer from heavy losses – both real and potential losses.
By contracting in good faith, employers avoid such scenario.
2) To maintain the reputation and the integrity of the business firm
The reputation and the integrity of a business firm or more collectively known as “goodwill,” play an intrinsic part in a business firm’s success. Business firms should maintain a high standard of goodwill by satisfying the stipulations contained in a CBA or an employment contract.
Failure to comply with the any of the agreements will negatively impact the reputation and the integrity of the business firm. The perception of external parties is vital for the business firm.
3) To keep the employees’ morale high
The morale of the employees is also a major element in business operations. Employers should always uplift the morale of his employees. Needless to say, in the event of failure to satisfy the stipulations of a CBA, the employees’ morale lowers.
By contracting in good faith, employers are assured that their employees are high on morale.
