Labor-Management Cooperationin a World-Class Region

A Report Prepared for the Northeast Ohio Research Consortium

Steve ClemMark ErenburgJocelyn Fagan

John LogueDon Williams

April 2002

The research for this report was funded by a grant fromthe Northeast Ohio Research Consortium of Ohio’s Urban University Program

AcknowledgmentsAcknowledgmentsAcknowledgmentsAcknowledgmentsAcknowledgments

What will it take for Northeast Ohio to compete in the global economy of the 21st century as aworld-class region? At least a part of the answer has to do with the state of labor-management relations.This analysis of labor-management cooperation in Ohio has been undertaken within the generalframework of a series of research projects sponsored by the Northeast Ohio Research Consortium ofOhio’s Urban University Program. The Consortium’s World-Class Region project has been directed byLarry Ledebur, Kevin O’Brien, and Jan Purdy of the Urban Center at Cleveland State University. Withouttheir inspiration and encouragement, this monograph never would have been written.

This project is a collaborative, inter-institutional, and interdisciplinary effort. The authors are SteveClem, who has served as Research Director of the United Rubber Workers and in the ResearchDepartment of the United Steelworkers before joining the staff of the Ohio Employee Ownership Centerat Kent State University; Mark Erenburg, former professor of industrial relations in the College of BusinessAdministration at Cleveland State University and now a private consultant and head of the WorkplaceRelations Institute at Lorain County Community College; Jocelyn Fagan, former labor economist andresearcher at the Urban Center at Cleveland State University and now a grant writer at St. Edward’sUniversity in Austin, TX; John Logue, professor of political science at Kent State University and directorof the Ohio Employee Ownership Center; and Don Williams, professor of economics at Kent StateUniversity.

Jocelyn Fagan and Don Williams authored the literature review; Mark Erenburg is responsible forthe section on theory and practice with its case studies; Steve Clem wrote the description and analysis ofthe Ohio Labor-Management Cooperation Program with some additions by John Logue; and Loguedrafted the introduction and the final section on labor-management cooperation in the 21st century.Logue is also responsible for the overall editorial work.

This project was supported financially by the Northeast Ohio Research Consortium of Ohio’sUrban University Program. The authors greatly appreciate the assistance of Karen Conrad, Manager,Office of Labor-Management Cooperation, Ohio Department of Development; and Bob Meyer, ExecutiveDirector, Work in Northeast Ohio Council. Thanks, too, to John Grummel, Robin Richards, and ChrisCooper for research assistance and for preparing the figures.

Steve ClemMark ErenburgJocelyn FaganJohn LogueDon Williams

Cleveland and Kent, Ohio

ContentsContentsContentsContentsContents

1. Introduction: The Past as Prologue 4

2. Labor-Management Cooperation in the Literature 6

3. Theory and Practice of Labor-Management Cooperation:Case Studies of General Motors-Lordstown and Stein, Inc. 20

4. The Ohio Labor-Management Cooperation Program 31

5. Envisioning Labor-Management Cooperation in the 21st Century 48

References 55

Notes 58

Figures

Figure 1. Development of the OLMCP’s Structure 36

Figure 2. Ohio Counties Without Coverage by ALMCs 39

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1. Introduction: The Past as Prologue

What should labor-management relations look like for Northeast Ohioto compete as a world-class region in the global economy of the 21st century?What lessons can we learn from the past?

Ohio is a microcosm of American labor history. Modern craft unionismtook root in the 1880s in Ohio’s cities after the demise of the Knights of Labor.Many of its craft locals had a penchant for socialist politics; it was not chancethat Socialist presidential candidate Eugene Debs went to prison for seditionduring World War I for a speech he made in Canton, Ohio. After the war, Ohio,with its heavy industrial base, was one of the scenes of the massive effort toorganize steelworkers within the craft union system in 1919, an effort thatfailed. In the early 1930s, the unskilled immigrant workers in the metal tradesin Cleveland flocked to the Industrial Workers of the World in the first push toorganize the unskilled. Ohio workers died in pitched battles between strikersand company guards in the early years of the Depression. The sit-down strike,which moved workers off the picket line into the shelter of the plant, waspioneered in Akron in 1934 by rubber workers. The Congress of IndustrialOrganizations’ (CIO) first great success in organizing unskilled workers camewith the victorious conclusion to the Goodyear strike in 1936. Even after theNational Labor Relations Act was the law of the land, Ohio workers facedmachine guns during the Little Steel Strike of 1938.

In labor relations, as in so much else, World War II forged us into onenation. Unionization became commonplace throughout defense industries inOhio, and labor-management cooperation committees were part of the wareffort. By the end of World War II, Ohio was part of the industrial unionheartland of the United States. The large plants of heavy industry -- steel, auto,rubber, machine tools, electrical equipment, aircraft engines -- were unionbastions. The traditional craft trades were also well organized. The unions’great postwar political mobilization came at the ballot box in 1958, when a “rightto work” initiative on the ballot went down to flaming defeat. The next year theSteelworkers Union went out on strike for 116 days.

From World War II through the 1970s, the industrial unions in Ohiosystematically pushed up wages and benefits for the unskilled and semi-skilledin mass production. While these jobs frequently remained hard, monotonous,and dangerous, working class wage and benefit standards in theseoligopolistic industries increasingly approximated those of the middle class.Union workers bought cars, moved to the suburbs where they bought homeswith FHA and Veterans Administration mortgages, added a second car for thewife, and could afford to send their kids to college. They were living theAmerican dream.

In fact, life was so good that they even wildcatted for self-respect andhumane working conditions in 1972 at the brand-new, state-of-the-artLordstown GM assembly plant. Public employees became restive in the 1970stoo. Despite the lack of a public sector collective bargaining law, public schoolteachers went on strike and were put in jail for doing so. Ohio’s public sectorcollective bargaining situation was regularized with the Public EmployeeCollective Bargaining Law of 1983.

The end of the 1970s saw economic globalization hit Ohio. First camethe steel shutdowns that devastated Youngstown between 1977 and 1981.

What would labor-What would labor-What would labor-What would labor-What would labor-managementmanagementmanagementmanagementmanagementcooperation look likcooperation look likcooperation look likcooperation look likcooperation look likeeeeein a world-in a world-in a world-in a world-in a world-classclassclassclassclassregion?region?region?region?region?

5

Then, in the 1980s, industrial jobs in auto, machine tools, and electricalequipment hemorrhaged as high interest rates led to an overvalued dollar, aflood of cheap imports, and a growing merchandise trade deficit. Hard timeshad come to the industrial heartland.

The contraction of employment in mass production and heavy industryhit Ohio hard. Median hourly wages fell from 10 percent above the nationalnorm in 1979 to the national average in 1989 (Cassell and Hanauer 1999,Table 2.1). While Ohio’s unionization rate fell over the years to 20.3 percent in19971, it remained 50 percent above the national average of 14.1 percent in1997.

The wage premium remains in Ohio’s unionized sector in almost everycategory: male union workers earn 18 percent more wages than non-unionmembers; women union members earn 29 percent more than their non-unioncounterparts; white union members average 25 percent higher saleries thanwhite non-union workers; black union members get 35 percent more than blacknon-union; and in every educational category except those with collegedegrees, union members earn 25 percent to 40 percent more than their non-union counterparts. Among those with college degrees, there is approximatewage equivalence, regardless of collective bargaining status (Cassell andHanauer 1999, Tables 2.6-2.8).

While Ohio’s labor history includes its share of bitterly adversarial laborrelations, it also includes in the 1980s and 1990s what is the largest-scale stateeffort to encourage labor-management cooperation since World War II -- theOhio Labor-Management Cooperation Program.

This monograph seeks to answer a simple question: What would labor-management cooperation look like in a world-class region?

As we search for the answer to that question, we will start with theliterature -- the subject of the next section. We will then compare this theorywith practice using case studies of General Motors’ Lordstown complex --where things have changed a lot since 1972 -- and Stein, Inc., a contractor tothe steel industry. We will then examine what has characterized labor-management relations in Northeast Ohio historically and how the State of Ohiohas sought to affect this in the last two decades through the Ohio Labor-Management Cooperation Program (OLMCP). Finally, we will envision acooperative future.

...male union...male union...male union...male union...male unionworkworkworkworkworkers earn 18ers earn 18ers earn 18ers earn 18ers earn 18

percent more wagespercent more wagespercent more wagespercent more wagespercent more wagesthan non-unionthan non-unionthan non-unionthan non-unionthan non-union

members; womenmembers; womenmembers; womenmembers; womenmembers; womenunion members earnunion members earnunion members earnunion members earnunion members earn

29 percent more than29 percent more than29 percent more than29 percent more than29 percent more thantheir non-uniontheir non-uniontheir non-uniontheir non-uniontheir non-union

counterparts.counterparts.counterparts.counterparts.counterparts.

6

2. Labor-Management Cooperation in the Literature2. Labor-Management Cooperation in the Literature2. Labor-Management Cooperation in the Literature2. Labor-Management Cooperation in the Literature2. Labor-Management Cooperation in the Literature

What comprises a world-class region? According to IndustryWeek, aworld-class region is characterized by high productivity and competitiveness,by the ability to attract new firms and retain old ones, and by “the enterprise ofmanagement, labor, politicians, educators, and other community leaders”(McClenahen 1998, p. 42). Such regions tend to have high incomes, highgrowth rates in income and employment, and a high quality of life. World-classregions often are those in which significant investments in training andeducation are undertaken by employers and employees.

The labor relations environment in a region can be an importantdeterminant of whether it attains such world-class status. Regions withconsiderable degrees of labor strife, for example, may suffer from lowerproductivity or higher labor costs and consequently be unattractive to newventures or firms considering expanding existing facilities. At the same time, alow level of activity on the part of organized labor is not sufficient to warrantworld-class status, if it means low levels of productivity or productivity growtheven when coupled with low wages.

Labor-management cooperation (LMC), in many forms, is a criticaldimension of the labor relations environment, which theoretically cancontribute to higher productivity while maintaining cost competitiveness. Inaddition, it can contribute to the development of a common set of community-wide goals that characterizes the world-class region. Such cooperation cantake place in non-unionized as well as unionized environments and could havepositive effects in either case.

Regrettably, there is little or no evidence in the academic literature thatspecifically measures the extent to which labor-management cooperation isimportant in attaining world-class status. There is considerable evidence thatsuch cooperation can have the effect of raising productivity at the firm level,however, and that it can help to decrease unit costs. Our supposition is that aregion in which such cooperation prevails will have a distinct competitiveadvantage over other regions.2

Just what constitutes labor-management cooperation? This sectionreviews the literature regarding labor-management cooperation and its effects,beginning with a definition of LMC and its goals. This is followed by a briefhistory of labor-management cooperation and the underlying theory on whichit is based. Finally, we address the question of what makes a successful LMCeffort and provide examples of successful (and unsuccessful) ventures.

Definitions and GoalsThe term “labor-management cooperation” has been defined and used

in as many ways as there are people who have made the attempt. Itencompasses a wide range of activities, from the formation of labor-management committees to quality circles and work teams and is employed inboth union and non-union settings.

One common characteristic in definitions of labor-managementcooperation is that it provides for a role for workers in decisions relating to howtheir work will be done. 3 The types of activities that would comprise such adefinition of labor-management cooperation include the following (Cooke1990, Mann 1989, Hansen 1997):4

One commonOne commonOne commonOne commonOne commoncharacteristic incharacteristic incharacteristic incharacteristic incharacteristic indefinitions ofdefinitions ofdefinitions ofdefinitions ofdefinitions oflabor-managementlabor-managementlabor-managementlabor-managementlabor-managementcooperation is that itcooperation is that itcooperation is that itcooperation is that itcooperation is that itprovides a role forprovides a role forprovides a role forprovides a role forprovides a role forworkworkworkworkworkers in decisionsers in decisionsers in decisionsers in decisionsers in decisionsrelating to how theirrelating to how theirrelating to how theirrelating to how theirrelating to how theirwork will be done.work will be done.work will be done.work will be done.work will be done.

7

labor-management committeesquality of work life programsemployee involvement programsemployee participation programsquality circleswork teamsScanlon plansprofit-sharing/gain-sharing arrangementssocio-technical systemsgroup incentive plansemployee ownership plansAs noted by Cooke, except for labor-management committees, most

efforts are aimed at the shop-floor level of participation or employeeinvolvement. While the structures are often similar, the activities may varyalong many dimensions. These include the intensity of participation, theemphasis placed on performance-related factors, the autonomy and decision-making authority granted to teams, the degree of union leader input, andwhether or not there are financial incentives to employee participation (1990,4).

In addition to taking many forms, labor-management cooperationefforts arise with a wide variety of goals and purposes. According to Kelly andHarrison (1992), however, from the perspective of the firm “the ultimate goal ofall Employee Involvement/Employee Participation (EI/EP) programs is theimprovement of work group, workplace, or company-level performance inproductivity or product quality.” From the workers’ perspectives, other goalsmay include improvements in the quality of work life and increased job security(Kelly and Harrison 1992, 248; Weinberg 1976).

The attainment of these goals comes through many channels. In hisreview of the literature regarding the benefits of cooperative activities, Cookelists reduced waste and rework; reduced overhead, materials costs, andmaterial handling costs; enhanced supplier service; improved communica-tions; reduced grievances and disciplinary action; stronger identity andcommitment to company goals; and reduced absenteeism, tardiness, andturnover among the potential gains to management. His list of benefits toemployees includes increased intrinsic rewards from the participation process;greater say in how work gets accomplished; improved working conditions; andheightened dignity, self-esteem, and pride in one’s work, among others.Kochan, Katz, and McKersie describe the major objectives as “to overcomeadversarial relations and increase employee motivation, commitment, andproblem-solving potential” and “to simplify work rules, lower costs, and increaseflexibility in the management of human resources” (1986, 147). All of thesebenefits theoretically lead to the increased productivity or quality desired bymanagement and the improved quality of work life and job security desired byemployees. Other goals that have been identified in the literature includereducing the impact of a plant closing (American Arbitration Association Labor-Management Committee 1985) and engendering support for organizationalpolicy changes or enhancing organizational performance in general(Schwochau, et al. 1997).

From a broader perspective, Heckscher argues that labor-managementcooperation offers a way to extend employee rights to the workforce as awhole, both unionized and non-unionized, and provides for an alternative

...labor-...labor-...labor-...labor-...labor-managementmanagementmanagementmanagementmanagement

cooperation effortscooperation effortscooperation effortscooperation effortscooperation effortsarise with a widearise with a widearise with a widearise with a widearise with a wide

variety of goals andvariety of goals andvariety of goals andvariety of goals andvariety of goals andpurposes.purposes.purposes.purposes.purposes.

8

method of dispute resolution that leads to more flexible and frequentresolutions. In both cases, increased and open communication amongmanagers, union leaders, and union members is an important source of thebenefits from cooperation.

History and Theory of Labor-Management CooperationLabor-management cooperation in the United States dates back at

least to the 1920s (Batt and Weinberg 1978; Gray 1983; Weinberg 1976). Theearliest form appears to have been the labor- management “committee.” Inresponse to efforts to nationalize the failing railway system, the B&O Railroadand the Machinists Union formed a system of joint committees in repair shops.The intent was to screen worker suggestions to improve efficiency, reducewaste, and increase customer satisfaction. The venture was a success forabout 15 years, until the Great Depression had sufficiently taken its toll andworker desires to decrease costs diminished (Weinberg 1976). According toGray, other efforts at joint committees arose in this time period out of thecommon threat that non-union employers presented to unionized companies(1983). The American Federation of Labor (AFL) encouraged the formation ofjoint committees in the late 1920s, and Confederation of IndustrialOrganizations (CIO) leaders promoted a program of employee participationinitiatives in the late 1930s (U.S. Department of Labor 1984, 59).

World War II brought a national industrial mobilization in response tothe foreign threat. More than 5,000 labor-management committees wereformed in the 1942-1945 period. Approximately 1,000 of these committeesdealt specifically with productivity issues (Weinberg 1976). After the war andthe end of the War Production Boards, these committees were disbanded,except in Canada where several thousand still exist.

In the period from 1945 to the mid-1970s, joint committees aimed atincreasing productivity were rare and were formed “only in exceptionalsituations” (Weinberg 1976, 15). In 1963-64, for example, only 44 of 1,773major collective bargaining agreements studied by the Bureau of LaborStatistics had provisions for such committees. By the mid-1970s this numberhad grown to 97 of 1,550, mostly in the steel industry (Weinberg 1976).

The decade of the 1970s saw the considerable development ofcooperative activities which has continued throughout the 1980s to today.Such initiatives arose at the plant, industry, and community levels. Accordingto Cooke, the increased volatility of the 1970s, in terms of unemployment,inflation, and interest rates, contributed to the desire on the part of unions andmanagement to work together. Both parties desired greater job security andimproved productivity. Beginning in the 1970s and continuing through the nextdecade, the threat of global competition provided the impetus to improve laborrelations in order to decrease costs, increase job security, and provide greaterflexibility (Cooke 1990, Heckscher 1988, Gray 1983, Stepp 1988, Weinberg1976). Global competition was not the only threat, however: the continuousdecline of union representation in the U.S. private sector labor market,increased technological change, and extensive deregulation of marketscontributed to the pressures felt by all parties to cooperate (Cooke 1990, Stepp1988, Gray 1983).

All of these factors led to an increase in the use of labor-managementcommittees and to increased use of other forms of labor-management

Beginning in the 1970sBeginning in the 1970sBeginning in the 1970sBeginning in the 1970sBeginning in the 1970sand continuing throughand continuing throughand continuing throughand continuing throughand continuing throughthe nethe nethe nethe nethe next decade,xt decade,xt decade,xt decade,xt decade,the threat of globalthe threat of globalthe threat of globalthe threat of globalthe threat of globalcompetition providedcompetition providedcompetition providedcompetition providedcompetition providedthe impetus tothe impetus tothe impetus tothe impetus tothe impetus toimprove laborimprove laborimprove laborimprove laborimprove laborrelations in order torelations in order torelations in order torelations in order torelations in order todecrease costs,decrease costs,decrease costs,decrease costs,decrease costs,increase job securityincrease job securityincrease job securityincrease job securityincrease job security,,,,,and provide greaterand provide greaterand provide greaterand provide greaterand provide greaterflefleflefleflexibilityxibilityxibilityxibilityxibility.....

9

cooperation as well. The 1960s and 1970s saw the expansion of Quality ofWork Life programs, for example, soon followed by Quality Circles, EI/EP, andother forms of increased worker involvement. Some of the most notableexamples are found in the steel and automobile industries and at thecommunity level in Jamestown, New York. In 1971, the United Steelworkersand 10 basic steel companies agreed to establish plant-level joint committeesdealing with productivity issues, an effort that grew out of a long-standingtradition of cooperation in other areas. In 1973, the United Auto Workers(UAW) and General Motors (GM) established the National GM-UAWCommittee to Improve the Quality of Work Life. Its purpose was to review,evaluate, and develop programs to improve the work environment ofemployees represented by the union. The UAW was active in establishing jointprograms throughout the industry in this period, including joint experiments withRockwell International in Battle Creek, Michigan, and Harmon InternationalCompany in Bolivar, Tennessee (Weinberg 1976).

In Jamestown, New York, labor-management cooperation was viewedas a way to halt the community’s decline, resulting in the formation of theJamestown Area Labor-Management Committee in 1972. The committee wascomprised of members from international corporations, local firms, and theMachinists, Auto Workers, Steelworkers, and Furniture Workers unions.Productivity improvement was the most important objective of the committee(Weinberg 1976, 19-20).

Of course, cooperation was not the only strategy followed by firmsduring the period of the 1960s and 1970s. In many cases, managementpursued a strategy of union avoidance, or a mixed one of avoidance andcooperation (Cooke 1990). The plant location decisions of Procter and Gamblein the 1960s are cited as an example of the avoidance approach. Indeed, theQuality of Work Life programs have been viewed by some as a unionavoidance strategy in the 1960s and 1970s (Kochan, Katz, and McKersie 1986,U.S. Department of Labor 1984).

In any case, labor-management cooperation in some form is moreprevalent now than in any recent period, except perhaps during World War II.In 1990, the General Accounting Office found that 86 percent of Fortune 1000firms had some experience with employee involvement (in some form) in theirfirms. A 1991 survey of 691 establishments found that 64 percent reportedhaving one or more employee-involvement activities covering at least 50percent of their “core” employees. Finally, a 1993 survey of 51 large firms foundthat roughly 80 to 90 percent of them had joint committees dealing with health,safety, productivity, or quality issues.5

During the first years of the Clinton Administration, Secretary of LaborRobert Reich prioritized encouraging ” high performance” workplace practicesas the government sought to generalize labor-management cooperativepractices (U.S. Department of Labor 1993).

What leads to the desire on the part of managers or workers tocooperate? Put differently, why pursue the goals of increased productivity orlower costs and better working conditions or job security through cooperationas opposed to pursuing the same goals through negotiation in the standardcollective bargaining context? In a non-union setting, as mentioned above,management may promote cooperative activities such as employeeinvolvement or participation as part of a union avoidance strategy. Workers

What leads to theWhat leads to theWhat leads to theWhat leads to theWhat leads to thedesire on the part ofdesire on the part ofdesire on the part ofdesire on the part ofdesire on the part of

managers ormanagers ormanagers ormanagers ormanagers orworkworkworkworkworkers toers toers toers toers to

cooperate?cooperate?cooperate?cooperate?cooperate?

10

may perceive the benefits derived from such cooperation as greater than thebenefits to be derived from representation by the union, the costs as lower, orboth.

In the union-management case, however, cooperation represents abreak from the traditional adversarial relationship between the parties and canimpose costs on all sides. Perhaps most important, it can mean a loss of controlover what have historically been management decisions or a loss of “authority”for management in general, and to losses of employment for workers, theundermining of union roles, and loss of union influence for union leaders(Cooke 1990).

In Cooke’s model of the decision by management and unions tocooperate, a key element is the “relative power” that each side has in thebargaining situation. Each side’s relative power determines its share of the “pie”that results from the employment relationship. Relative power is determined bythe costs of the demands at the table, by the economic, sociopolitical, andtechnical environments found at the time, by organizational features, and bythe bargaining skills of the players (1990, 23-27). Even when the expectedgains from a cooperative activity exceed the costs, one side may not desirecooperation if its relative power is such that it can realize even greater net gainsthrough the traditional adversarial process. Only when the relative power ofone side is reduced sufficiently does it pursue a cooperative strategy.

The above assumes a given size of the pie. Cooperative efforts cansometimes increase the size of the pie sufficiently to warrant cooperation, evenwithout a change in relative power. On the other hand, in times of intenseinternational competition, for example, cooperative efforts might simply keepthe pie from shrinking in size. This might be analogous to the “common enemy”situation described by Gray (1983). When the net gains to both sides areperceived as greater under cooperation than without it, then cooperation ispursued. Otherwise, it is not.

As noted by Cooke and others, these perceived gains and costs tocooperation vary over time and across industries and other characteristics offirms and employment relationships, as does the relative power of the playersat the bargaining table according to economic, political, and social changes.Consequently, the extent of cooperation also varies over time and place, andsome cooperative activities are initiated and then dropped. Still, there aresituations in which cooperation persists in given firms or industries, withcontinued long-term gains in productivity, satisfaction, and competitiveness.Characteristics of such “world-class” cooperative efforts are described in thenext section.

Characteristics of Successful Labor-Management CooperationWhat are the characteristics of world-class labor-management

cooperation (LMC)? A review of the literature suggests that the essentialelements of “good” LMC fall loosely within two broad categories: thosepertaining to the actual structure and composition of the cooperative activitiesand those that are characteristics of the organizational environmentsurrounding LMC. The latter category includes both tangible elements of theorganizational structure as well as more intangible elements that set the tonefor successful LMC. These elements facilitate and support LMC efforts and areno less important than the more procedural aspects. Importantly, no one or two

...the essential ele...the essential ele...the essential ele...the essential ele...the essential ele-----ments of “ments of “ments of “ments of “ments of “good” LMCgood” LMCgood” LMCgood” LMCgood” LMCfall loosely within twofall loosely within twofall loosely within twofall loosely within twofall loosely within twobroad categories:broad categories:broad categories:broad categories:broad categories:those pertaining tothose pertaining tothose pertaining tothose pertaining tothose pertaining tothe actual structurethe actual structurethe actual structurethe actual structurethe actual structureand composition of theand composition of theand composition of theand composition of theand composition of thecooperative activitiescooperative activitiescooperative activitiescooperative activitiescooperative activitiesand those that areand those that areand those that areand those that areand those that arecharacteristics of thecharacteristics of thecharacteristics of thecharacteristics of thecharacteristics of theorganizationalorganizationalorganizationalorganizationalorganizationalenvironmentenvironmentenvironmentenvironmentenvironmentsurrounding LMC.surrounding LMC.surrounding LMC.surrounding LMC.surrounding LMC.

11

characteristics may be considered to be the keys to success for LMC. AsKochan and Osterman put it, successful LMC is the result of “the combined andmutually reinforcing effects of a broad-based and deep commitmentY followedby effective implementation” (Kochan and Osterman 1994, 45).

Structure and Composition of LMCThe characteristics in the first category are relatively straightforward

and procedural in nature. For example, there is universal consensus that to besuccessful, LMC must be a joint effort with true joint “ownership” andstakeholdership. Both union leadership and management must be fullyinvolved in planning, administration, training and development, and evaluation,and either party must be able to terminate the effort at any time. Joint effortsin LMC are stronger since each party has a stake in its success. Also, directunion involvement helps to downplay the nearly unavoidable perception on thepart of workers that union leadership has been co-opted by management.

Along these lines, LMC activities must involve equal representation;that is, there must be equal numbers of union and managementrepresentatives. Equal representation is required in order to maintain thebalance of power between unions and management as well as the perceptionof that balance. Without it, workers are less likely to feel comfortable in directparticipation and in voicing their concerns and opinions (Bluestone andBluestone 1992, Heckscher 1988, American Arbitration Association LaborManagement Committee 1985). It is also critical that participation in LMCactivities be voluntary and non-exclusionary. In other words, employees mustbe able both to decline participation and to participate if they so choose(Bluestone and Bluestone 1992, Heckscher 1988). Finally, cooperativeactivities should be designed so that they are not vulnerable to staff changes;in this way, continuity and commitment is preserved (Batt and Weinberg 1978).

The literature also suggests that successful LMC requires carefulplanning before implementation. In order to fully enroll all parties incooperation, the planning stage should involve the joint development of theoverall mission of the LMC program. Working standards of consensus must bedeveloped regarding the goals of the organization in undertaking LMC.Consensus must also be reached regarding the jurisdiction of cooperativeactivities, the extent to which both parties will participate, the methods by whichdecisions will be made and implemented, and how disputes will be resolved. Abasic agreement specifying objectives, principles, and procedures should bedrafted jointly to be used as a frame of reference throughout the LMC process;it is critical that this agreement be made on the basis of consensus and acommitment to LMC by both parties. As LMC progresses, the problemsaddressed usually become more complex and formidable. When this occurs,both parties should be able to draw on the basic agreement to reorient theirefforts in line with the goals set initially by consensus, or to redirect the effortsif necessary (American Arbitration Association Labor Management Committee1985).

Regarding the jurisdiction of cooperative activities, LMC must notencroach upon the territory of traditional collective bargaining. First, andperhaps most important, under the Labor and Management Reconciliation Actof 1947 (the Taft-Hartley Act), it is illegal for collaborative activities to deal withissues such as wages, work hours, and other conditions and terms of

...labor-management...labor-management...labor-management...labor-management...labor-managementcooperation activitiescooperation activitiescooperation activitiescooperation activitiescooperation activities

must involve equalmust involve equalmust involve equalmust involve equalmust involve equalrepresentation...representation...representation...representation...representation...

12

employment that are by law the jurisdiction of collective bargaining.6 Moreover,in order to maintain a balance of power under the traditional system, both unionand management must maintain their relative strength and adversarialidentities. LMC must not impair either party’s bargaining strength regarding theissues covered under collective bargaining agreements. Hence, attemptsshould not be made to alter the terms of existing collective bargainingagreements and LMC should be structured so that collective bargaining issuesare not possible subjects for discussion. This stipulation reflects the concernthat, if LMC appears to be an alternative to collective bargaining, either sidemay be threatened and withhold participation and commitment, jeopardizingthe LMC program as a whole. It should be noted, however, that this distinctionis difficult to maintain in practice and depends in part on one’s interpretation ofthe issues covered under collective bargaining. LMC may in fact serve as aninstrument of “pre-bargaining” or pre-grievance dispute resolution withoutupsetting the traditional balance of power (Siegel and Weinberg 1982,Heckscher 1988, American Arbitration Association Labor ManagementCommittee 1985).

In terms of decision-making and dispute resolution, the LMC processmust accommodate the diverging interests of union and management, as wellas the diversity of interests and opinions on the part of workers participating incooperative activities. LMC must allow for open discussion and joint problem-solving, but the process must not cripple the flexibility of the organization. LMCactivities should involve third party facilitation as needed for the resolution oflarger issues in which one party has a significant stake and is thereforereluctant to cooperate fully (Heckscher 1988, Batt and Weinberg 1978).

Sustained LMC requires a system of evaluation with clear and relativelyobjective methods of tracking goals and outcomes: data analysis and collectionare crucial to the success of LMC initiatives. Both union and management enterinto LMC with the expectation of deriving benefits, yet the benefits of LMC maybe intangible or difficult to quantify. A valid way to measure the gains of LMCmust be implemented, as well as a system of rewarding the parties on the basisof their contributions to the gains. Sharing the gains of LMC is critical in orderto maintain workers’ interest in participating in LMC and to reward them for theresulting improvements in firm performance. It is best if compensation intendedas rewards for LMC directly reflects the outcomes of the LMC effort (Siegel andWeinberg 1982). Last, this type of compensation must not be used as asubstitute for regularly negotiated wage increases (U.S. Department of Labor1984).

Finally, a primary concern on the part of unions contemplatingparticipation in LMC is the effect of such cooperative activities on theemployment security and working conditions of their members. LMC isexpected to lead to increased productivity, which should benefit both workersand management, but may be used by management as justification for layoffs.This concern can be mitigated by including in the basic LMC agreementprovisions for employment security if productivity improvements result directlyfrom the cooperative activities. Other such provisions include stipulationsagainst “speed ups” or other reductions in working conditions as a result ofLMC. These issues underscore the need for a way to measure and evaluatethe impact of LMC on the organization’s performance in order to distinguishthem from the impact of factors unrelated to LMC (U.S. Department of Labor1984).

Labor-Labor-Labor-Labor-Labor-management coopmanagement coopmanagement coopmanagement coopmanagement coop-----eration will be mosteration will be mosteration will be mosteration will be mosteration will be mostsuccessful when thesuccessful when thesuccessful when thesuccessful when thesuccessful when theefforts are relativelyefforts are relativelyefforts are relativelyefforts are relativelyefforts are relativelydecentralized anddecentralized anddecentralized anddecentralized anddecentralized andactive at all levels ofactive at all levels ofactive at all levels ofactive at all levels ofactive at all levels ofthe organization.the organization.the organization.the organization.the organization.

13

Decentralization of EffortsLMC will be most successful when the efforts are relatively

decentralized and active at all levels of the organization (Heckscher 1988,Kochan and Osterman 1994). LMC activities should be established in ahierarchy of activities at the shop floor, departmental, plant, and executivelevels (American Arbitration Association Labor Management Committee 1985).

At the top level of the organization, union representation on the boardof directors allows for a certain level of co-determination. Through the unionboard member, the union can bring labor-related issues to the table andsensitize the board to the importance of the human capital of the firm.However, the literature suggests that representation on corporate boards in theabsence of cooperative activities at lower levels in the organization has notbeen meaningful. One reason is that there are rules governing board memberbehavior that make it difficult for the union board member to clearly side withlabor. For example, board members are required to vote in the shareholderinterest. Also, although board representation gives the union board memberaccess to financial information regarding the company, this information can notnecessarily be shared openly with the union. In general, union boardrepresentation does not affect or include workers directly. Therefore,cooperation at the top alone brings limited power, but relatively little voice orinfluence.

Similarly, LMC at the shop floor alone may also have limited results.Stand-alone shop floor cooperative efforts are less likely to have thecommitment and support of middle and top management. While these shopfloor efforts allow workers a certain amount of voice and influence in theorganization, they are somewhat limited in the issues they can tackle and haverelatively little power in terms of strategy. A combination of these types ofcooperation, that is, a system of cooperation throughout the firm, is necessaryto achieve a balance of voice and power for the union and its workers. If alllevels of the organization are involved in LMC activities, from top to middle tobottom, individuals in each have a stake in the LMC effort and are more likelyto make decisions to facilitate the process. The greater the extent to whichindividuals see themselves as partners in the LMC effort, the greater thelikelihood the effort will be sustained and succeed. Moreover, trust andcommitment are built through involvement; the broader-based the effort (i.e.,the greater the proportion of bargaining unit members involved), the more likelyLMC will have the support of employees, and the stronger the LMC effort will be(Cooke 1990; Heckscher 1988).

In some few categories of companies, most notably union-initiatedemployee-owned firms, there is a comprehensive system of labor-management cooperation from shop-floor committees through plant steeringcommittees and to the boardroom (Logue, et al. 1998, 65-85).

The Organizational EnvironmentThe characteristics considered above are crucial to successful LMC,

but are not enough. LMC does not take place in a vacuum, and theorganizational environment in which cooperation takes place is as important asits structure and composition. The supporting infrastructure and the general“tone” in which LMC takes place will partly determine the structure of theactivities themselves. According to the American Arbitration Association Labor

...the...the...the...the...theorganizationalorganizationalorganizationalorganizationalorganizational

environment in whichenvironment in whichenvironment in whichenvironment in whichenvironment in whichcooperation takcooperation takcooperation takcooperation takcooperation takeseseseses

place is as importantplace is as importantplace is as importantplace is as importantplace is as importantas its structure andas its structure andas its structure andas its structure andas its structure and

composition.composition.composition.composition.composition.

14

Management Committee, “The level of maturity and trust between the partieswill likely influence the degree of specificity that the parties feel they need tohave in their basic understanding; those with a long-term positive relationshipwill probably feel less need for detail in their agreement” (American ArbitrationAssociation Labor Management Committee 1985, 70). The overall climate inwhich LMC takes place is determined by the organizational structure of the firmand its ability to accommodate and support cooperation, the level ofcommitment and trust between management, union, and workers, and theextent to which communication is strong and information is shared openly.These factors are interrelated and reinforce one another to create a supportiveenvironment for LMC efforts.

The Organizational StructureAccording to the literature, successful LMC requires an organization-

wide culture of cooperation, that is, one in which LMC activities are integratedinto the overall organizational structure of the firm (U.S. Department of Labor1988, Heckscher 1988, Kochan and Osterman 1994). The most renownedsuccess stories in LMC, Shell-Sarnia, New United Motor Manufacturing Inc.(NUMMI), and Saturn, have organizational structures in which LMC is fullyintegrated with “fundamentally different production, human resources andorganizational strategies” (Kochan and Osterman 1994, p. 48). “Stand-alone”experiments in LMC, those in which limited and isolated forms of cooperationhave been introduced while most traditional human resources and governancepolicies remain intact, have shown less positive results in terms of performanceimprovements and sustainability than have totally new systems. This is not tosay that entirely new systems of work organization are necessary in order toimplement cooperative activities; LMC may thrive in a variety of organizationalstructures. However, the extent to which the overall organizational structurefacilitates LMC will partly determine the strength of the effort (Kochan andOsterman 1994, Siegel and Weinberg 1982, Heckscher 1988).

The degree to which the organizational structure can accommodateand support LMC depends on two factors: the importance of human resourcesto the organization and the extent to which corporate strategy is consistent withcooperation. First, since successful LMC requires the active participation ofskilled and knowledgeable employees, LMC will be most fruitful inorganizations in which employees are treated as sources of competitiveadvantage. When employees are treated as valuable members of theorganization, they will be more likely to commit themselves to the LMC effort,the quality of the products, and the performance of the firm. Further, incooperative programs, employees are given the opportunity to engage inproblem-solving and decision-making. To do so, they must not only have thesupport of the organization in allowing them to voice opinions, but also theknowledge and skills with which to do so. Therefore, LMC will be mostsuccessful in workplaces where jobs are designed so that employees can fullyuse their knowledge and skill bases and where tasks are broad in scope.Moreover, cooperative activities are most successful when combined withsubstantial investment in training and development (Kochan and Osterman1994).

Compensation that is linked to incentives or performance is onemanifestation of the importance of human resources in the firm, and LMC hasbeen shown to have the strongest impacts on productivity and quality when

...labor-...labor-...labor-...labor-...labor-managementmanagementmanagementmanagementmanagementcooperation will becooperation will becooperation will becooperation will becooperation will bestrongest whenstrongest whenstrongest whenstrongest whenstrongest whencorporate strategycorporate strategycorporate strategycorporate strategycorporate strategyconsiders cooperationconsiders cooperationconsiders cooperationconsiders cooperationconsiders cooperationa priority anda priority anda priority anda priority anda priority andsupports the goalssupports the goalssupports the goalssupports the goalssupports the goalsand process ofand process ofand process ofand process ofand process ofcooperation.cooperation.cooperation.cooperation.cooperation.

15

combined with some form of contingent compensation program (Kochan andOsterman 1994, Siegel and Weinberg 1982, Stepp 1988). Such programsrange from individual bonus systems to group-based systems to various typesof firm-wide gain and profit-sharing programs. The aim of such programs is toalign employees’ goals with those of the organization. Under these programs,the contingent portion of compensation often substitutes for a portion ofemployees’ regular wages. Therefore, a substantial amount of informationmust be provided to the union and employees so that the fairness of itsoutcomes can be confirmed. Credible and simple performance measures mustbe developed and this information must be shared with labor. Finally, suchcompensation should not be used as justification for productivity improvementsthat diminish working conditions and should not be used to promotecompetition rather than cooperation within the organization.

It follows that LMC will be strongest when corporate strategy considerscooperation a priority and supports the goals and process of cooperation.Competitive strategy must reflect the organization’s commitment to employeesas valued stakeholders rather than as pawns in the game of competition. Sinceoverall strategy is established at the top levels of the organization, commitmentto LMC and consistent demonstration thereof by executive management iscritical. Competitive strategy that depends on low wages and benefits andcost-cutting in general conflicts with the organizational values necessary tosupport LMC. Similarly, a corporation that allows cooperation in some facilitieswhile practicing anti-union activities in other areas of the corporation will notinstill the trust necessary to support LMC. Corporate strategy consistent withLMC is focused on quality, innovation, productivity, and customer service: allare goals to which unions and employees can be committed. A corporatestrategy that pledges employment security and provides training opportunitiesto employees to increase their skills toward this end will support LMC activities.Staffing policies designed to stabilize employment over the business cycleillustrate the importance of employees to the organization and thereby help tocreate a solid base for the LMC effort. It should be noted that such strategiesrequire a long-term view to corporate governance that may be difficult inincreasingly competitive markets and therefore can only be legitimized by topmanagement (Kochan and Osterman 1994, U.S. Department of Labor 1988).

Trust and CommitmentThere is universal consensus in the literature that LMC can not thrive

without a substantial and sustained level of trust and commitment on the partof both union and management. Indeed, an organization-wide culture ofcooperation cannot exist without strong bilateral leadership and commitment tothe LMC effort at all levels of union and management. Under LMC, thetraditional power positions of union and management are essentially “checkedat the door;” the structure of LMC makes this possible, but obviously requiresa high degree of trust (Heckscher 1988). Trust and commitment at the toplevels of union and management are especially significant since it sets the tonefor LMC and an example for all participants (Siegel and Weinberg 1982). Theintensity of the effort, that is, the time and other resources applied to LMC byunion and management, is one indication to employees of the commitment ofboth parties (Cooke 1990.)

Trust and commitment emerge in part from the development ofconsensus on common goals and philosophy (American Arbitration

...an organization-...an organization-...an organization-...an organization-...an organization-wide culture ofwide culture ofwide culture ofwide culture ofwide culture of

cooperation cannotcooperation cannotcooperation cannotcooperation cannotcooperation cannoteeeeexist without strongxist without strongxist without strongxist without strongxist without strongbilateral leadershipbilateral leadershipbilateral leadershipbilateral leadershipbilateral leadership

and commitment to theand commitment to theand commitment to theand commitment to theand commitment to theLMC effort at all levelsLMC effort at all levelsLMC effort at all levelsLMC effort at all levelsLMC effort at all levels

of union andof union andof union andof union andof union and management. management. management. management. management.

16

Association Labor Management Committee 1985). The growing diversity of theworkforce has led to the growing diversity of claims and concerns; anenvironment of trust is essential to allow these diverse opinions to be voicedopenly. LMC will work best to accommodate diversity when unity is built arounda general vision through consensus, that is, around working standards ofconsensus other than total agreement (Heckscher 1988). Since LMC effortsare often implemented during times of crisis for the organization, commitmentto the cooperative process may be built around the perception of a commonenemy (for example, heightened market competition or declining demand)(Gray 1983, Dinnocenzo 1989).

To a considerable extent, trust is built over time; each successful eventin collaboration builds a foundation from which to continue. Trust accumulatedover time helps cooperative efforts by adding to the overarching culture ofcooperation in the organization. Supportive business strategies are critical inmaintaining the trust of union leadership and employees. According toKochan, a sustained level of trust “depends heavily on the extent to which thecompany’s long-term competitive strategies, investment decisions, and use oftechnology take employee interests into account” (U.S. Department of Labor1988, p.17). Again, corporate strategy should reflect the importance ofemployees to the organization; strategies such as limited outsourcing andstaffing for employment stability engender trust that facilitates LMC.

Information SharingEffective LMC involves many individuals in different combinations at

many levels within the firm, yet each is working more or less tow ards the sameends. Therefore, a strong and open flow of information within the organizationis necessary to insure that “all players are on the same field.” Under thetraditional system of labor relations, information within organizations tends tobe centralized; this is especially true of unions, which conserve scarceresources and promote unity by filtering the flow of information. Further, underthe adversarial system of collective bargaining, it is not often in either party’sinterest to share information because information is the basis for power at thebargaining table. LMC involves the decentralization of decision-making and,hence, requires the decentralization of information. Unlike under collectivebargaining, communication in cooperative activities is direct and decisions aremade more frequently and quickly, requiring the flow of information both up anddown the hierarchy. An open flow of information is as much a challenge forunions as for management, since neither is accustomed to providinginformation to lower levels of the organization (Heckscher 1988, AmericanArbitration Association Labor Management Committee 1985).

One obstacle faced by LMC efforts is the asymmetric nature ofinformation in the firm. Management tends to have superior informationrelating to financial performance and competitive factors, while unions mayhave better information regarding the abilities and needs of their members.Therefore, open and accurate information-sharing is essential in cooperativeefforts. Moreover, open information and trust in LMC are related. Partial ordistorted information will yield mistrust on both sides. In order to develop thehigh level of trust necessary for successful LMC, participants must not withholdinformation. Since management normally possesses more information thanlabor, the perceived cost of sharing information is higher for management.

An open flow ofAn open flow ofAn open flow ofAn open flow ofAn open flow ofinformation is asinformation is asinformation is asinformation is asinformation is asmuch a challenge formuch a challenge formuch a challenge formuch a challenge formuch a challenge forunions as for man-unions as for man-unions as for man-unions as for man-unions as for man-agement.agement.agement.agement.agement.

17

Therefore, the commitment to shared information must be strong and apparent,especially at the higher levels of management. At the same time, a high levelof trust is a prerequisite to the sharing of sensitive information such as thefinancial and competitive position of the firm. Joint information-gathering is oneway to dispel the problem of asymmetric information (Heckscher 1988). If allparties determine collectively the information needed for the effort and thenjointly gather that information, trust and confidence in quality of the informationis increased. A joint approach to information also prevents the problem ofmanagement overwhelming the LMC effort in data, leaving the union sidesuspect (Heckscher 1988).

Training and DevelopmentFinally, there is uniform consensus in the literature that LMC is most

successful when workers, management, and union leaders are provided withopportunities for training in the skills required to participate effectively in LMC.In general, better-skilled and informed participants will improve the results ofthe LMC effort because they are both committed to participation and have themeans to participate effectively. First, participants must be trained in themechanics of LMC. Workers and managers must be fully informed of the goalsof the effort and the process itself. Thus, some initial orientation is necessaryduring the implementation of cooperative efforts. Training must also beongoing to accommodate changes in the staff of LMC efforts over time, as wellas changes in focus (American Arbitration Association Labor ManagementCommittee 1985).

Second, LMC requires different skills on the part of participants thandoes collective bargaining and traditional labor relations. Participants in LMCrequire a range of process skills, such as the ability to communicate effectively,identify and solve problems, analyze data, and think strategically. Groupdynamics in LMC are critical; participants require the ability to work as a groupin identifying and prioritizing problems and analyzing data. Training anddevelopment to support LMC must provide these “softer” skills as well as thetechnical skills required by employees on the job. Such training is especiallyimportant for middle managers, who may be accustomed to managing byauthority. Successful LMC requires more open, non-authoritarianmanagement styles. Training of middle managers to accept this change in theirroles is important to insure their participation commitment to the LMC effort(American Arbitration Association Labor Management Committee 1985).Examples set at the executive management level are also necesssay.

Training is also critical for union leadership and staff, who have beenaccustomed to adversarial labor relations based on the interpretation of legalstandards and the strict following of rules. According to Dinnocenzo, LMC “requires union leaders to shift their orientation from direct service to theirconstituents to the shaping of policy, and from a stance of opposition to one ofinvolvement” (Dinnocenzo 1989, 37). Skills of communication and problemanalysis are obviously important as these roles shift. Moreover, LMC usuallymeans a decentralization of responsibility within the union, with moreresponsibility shifted to the steward level. Therefore, additional training at thesteward level may be necessary (Heckscher 1988).

Training and development must not focus only on the mechanics andcognitive skills required by the LMC process. As Kochan and Osterman put it,

PPPPParticipants in LMCarticipants in LMCarticipants in LMCarticipants in LMCarticipants in LMCrequire a range ofrequire a range ofrequire a range ofrequire a range ofrequire a range of

process skills, such asprocess skills, such asprocess skills, such asprocess skills, such asprocess skills, such asthe ability tothe ability tothe ability tothe ability tothe ability tocommunicatecommunicatecommunicatecommunicatecommunicate

effectivelyeffectivelyeffectivelyeffectivelyeffectively, identify, identify, identify, identify, identifyand solve problems,and solve problems,and solve problems,and solve problems,and solve problems,

analyze data, andanalyze data, andanalyze data, andanalyze data, andanalyze data, andthink strategicallythink strategicallythink strategicallythink strategicallythink strategically.....

18

some LMC efforts have failed because “they place too much emphasis on thesocial or democratic functions of participation and not enough on building thetechnical knowledge needed for job-related problem-solving and decisionmaking” (Kochan and Osterman 1994, 49). LMC efforts are often part ofworkplace innovations that entail higher levels of skills on the part of workers,for example multi-skilling and team-based work. Therefore, investment in thedevelopment of enhanced technical skills is necessary as well for successfulLMC. For example, the cross-training of workers for different jobs has beenfound to be associated with the sustainability of LMC efforts (Kochan andOsterman 1994).

SustainabilityA review of the literature indicates that, in general, LMC efforts are

considered successful in terms of sustainability if they have been in place for atleast three years (Cooke 1990). World-class LMC should, of course, besustainable. However, even the best LMC efforts have been shown to bevulnerable over time (Kochan and Osterman 1994, Heckscher 1988, Siegeland Weinberg 1982). Part of the difficulty is that the perceived gains from LMCtend to diminish over time as enthusiasm wanes and the novelty of cooperationwears off. Over time, the problems addressed by LMC become wider in scopeand more controversial. Issues approached at the beginning of the effort tendto be relatively straightforward and uncontroversial; for example, the décor andphysical environment of the workplace or work rules and supervision matters.As LMC matures, the problems addressed enter the areas traditionallygoverned exclusively by management, such as the firm’s systems ofmeasurement and evaluation and the organization of production. Thesematters are more controversial and LMC efforts tend to plateau at this stage(Heckscher 1988). All LMC efforts are vulnerable to the tendency for bothunion and management to resist change, and as the problems addressedbecome more formidable, LMC becomes more fragile (Siegel and Weinberg1982).

Competitive pressures are also often associated with the failure of LMCefforts to be sustained (Kochan and Osterman 1994, Heckscher 1988).Declining market share, intensified international competition, and otherchallenges of this sort pressure management to increase productivity andreduce costs. In this environment, management will face pressure from bothcompetition and investment analysts to turn to layoffs and outsourcing. Asdiscussed above, layoffs and outsourcing generally “go against the spirit” ofcooperation; such strategy is certain to lead to feelings of betrayal, mistrust,and fear on the part of unions and employees and thereby ruin the LMC effort.This is especially true if management reneges on promises made during theimplementation of LMC efforts, such as employment security and staffing foremployment stability.

Unsurprisingly, the chances for sustainability are greatest in world-classLMC efforts, that is, efforts and organizations featuring the characteristicsoutlined above. In theory, all of the above characteristics should facilitate thesustainability of LMC. For example, the fragility of LMC efforts has been shownto be related to insufficient knowledge and expertise on the part of participants(Siegel and Weinberg 1982). This problem can be mitigated by thecomprehensive planning and orientation of LMC participants, substantial

A workingA workingA workingA workingA workingconsensus betweenconsensus betweenconsensus betweenconsensus betweenconsensus betweenunion andunion andunion andunion andunion andmanagement onmanagement onmanagement onmanagement onmanagement onthe organizationthe organizationthe organizationthe organizationthe organization’s’s’s’s’spriorities regardingpriorities regardingpriorities regardingpriorities regardingpriorities regardingLMC, productivityLMC, productivityLMC, productivityLMC, productivityLMC, productivity, hu-, hu-, hu-, hu-, hu-man capital, and com-man capital, and com-man capital, and com-man capital, and com-man capital, and com-petitiveness may helppetitiveness may helppetitiveness may helppetitiveness may helppetitiveness may helpto preclude failureto preclude failureto preclude failureto preclude failureto preclude failureof LMC due to aof LMC due to aof LMC due to aof LMC due to aof LMC due to adeclining competitivedeclining competitivedeclining competitivedeclining competitivedeclining competitiveenvironment.environment.environment.environment.environment.

19

investments in training, and a sufficient degree of information-sharing withinthe effort. The diminishing of perceived gains over time can be mitigated byinsuring that the administration of the effort includes a valid way to measure theactual gains of LMC despite their intangible nature. A working consensusbetween union and management on the organization’s priorities regardingLMC, productivity, human capital, and competitiveness may help to precludefailure of LMC due to a declining competitive environment (Cohen-Rosenthal1995). Two factors in particular are important here: compensation and rewardsystems based on firm performance and considerable training opportunitiesavailable to employees. Both have been shown to be positively related to thesustainability of LMC efforts (Kochan and Osterman 1994).

Finally, sustainability is more likely if LMC activities are integrated intothe overall organizational structure of the firm (Kochan and Osterman 1994).Cooperation that is embedded in human resource policies, in strategicdecision-making, and in the overall culture of the organization will not be asfragile as stand-alone experiments in LMC. Such an organization-widecommitment to cooperation requires a considerable level of trust and strongbilateral leadership, both of which should also facilitate the sustainability ofLMC.

Regional InfrastructureIt should be remembered that in-plant LMC, while the foundation of

successful LMC, does not take place in a vacuum. When thinking about thecharacteristics of LMC in a world-class region, it is necessary to give someconsideration to the characteristics of the region itself that support or detractfrom LMC efforts. Although this aspect is not discussed directly in the literature,we believe that the regional infrastructure supporting LMC may be critical to thesuccess of cooperative efforts.

Since LMC activities usually occur at the establishment, or in-plantlevel, a region’s LMC can be thought of as the combination of all the in-plantpractices in the region. Characteristics of the region then provide anenvironment in which LMC can take place, and this environment may supportor detract from its success. In general, the regional infrastructure for LMC canbe conceived of as a function of three elements. First is the nature of localeconomic development incentives and activities; for example, are localindustrial retention and expansion efforts sensitive to the needs and demandsof labor? Second are the region’s and, hence, the state’s, labor andemployment laws. Some state legal environments are more “worker friendly”than others. For example, Ohio is known in part for high worker andunemployment compensation. Third is the existence of other organizations thatprovide supporting infrastructure for LMC. An example of these organizationsare area labor-management committees (ALMCs). ALMCs, such as thoseunder the Ohio Labor-Management Cooperation Program (OLMCP), providethird party, externally funded support for in-plant LMC efforts. Local economicdevelopment efforts that explicitly consider the region’s labor force as valuable,state labor and employment laws that offer strength in traditional laborrelations, and the presence of organizations such as ALMCs all facilitate world-class labor-management cooperation by setting a tone of cooperation andcreating an environment in which world-class labor-management cooperationand best practices can be fostered.

...the regional...the regional...the regional...the regional...the regionalinfrastructureinfrastructureinfrastructureinfrastructureinfrastructure

supporting LMCsupporting LMCsupporting LMCsupporting LMCsupporting LMCmay be critical tomay be critical tomay be critical tomay be critical tomay be critical to

the success ofthe success ofthe success ofthe success ofthe success ofcooperative efforts.cooperative efforts.cooperative efforts.cooperative efforts.cooperative efforts.

20

3. Theory and Practice of Labor-ManagementCooperation: Case Studies of General Motors-

Lordstown and Stein, Inc.

The literature review suggests that a model implementation of labor-management cooperation (LMC) at the plant level includes both a basicstructure and composition that facilitate cooperation and an organizationalenvironment that accommodates and supports cooperation. The basicstructure that facilitates cooperation includes:

* Joint planning, administration, and evaluation – i.e., jointstakeholdership.

* Planning before implementation, including the development ofworking standards of consensus on the mission, goals, andprocedures of LMC.

* Equal representation of union and management.* Voluntary and non-exclusionary participation.* Invulnerability to staff changes.* A clear distinction between the issues addressed through LMC and

those addressed through collective bargaining.* Forums for open discussion and joint problem-solving to

accommodate diverse interests.* A system of evaluation and clear measures of goals and outcomes.* A system of gain-sharing.* Provisions to ensure employment security and good working

conditions.* Decentralization of activities – activities present at all levels of the

organization.The organizational environment that accommodates and supports cooperationincludes:

* The integration of activities into the organizational structure of thefirm – an organization-wide culture of commitment.

* An organizational culture that views and treats employees asvalued stakeholders.

* Incentive- or performance-based compensation that reflects thespirit of cooperation.

* Corporate strategies that reflect a commitment to employees andthe mission of cooperation.

* Trust and commitment on the part of both union and management– strong bilateral leadership as an example for participants.

* Strong and open flows of information within the organization.* Substantial opportunities for training and development in both the

skills required for LMC and the skills required by the workplace.

While scholars define model relations both in terms of structure andenvironment, practitioners see model labor-management cooperation mostlyin terms of a practical environment that accommodates cooperation with anemphasis on the role of individuals within that environment. According tonortheast Ohio union and management advocates interviewed in focus groupsduring spring 1998,7 the basic elements of a world-class implementation of

TTTTTwo ewo ewo ewo ewo exxxxxemplary LMCemplary LMCemplary LMCemplary LMCemplary LMCinitiatives in northeastinitiatives in northeastinitiatives in northeastinitiatives in northeastinitiatives in northeastOhio are at GeneralOhio are at GeneralOhio are at GeneralOhio are at GeneralOhio are at GeneralMotors, Lordstown andMotors, Lordstown andMotors, Lordstown andMotors, Lordstown andMotors, Lordstown andStein, Inc.Stein, Inc.Stein, Inc.Stein, Inc.Stein, Inc.

21

labor-management cooperation, drawn from their experience in northeastOhio, are predominately environmental and personal and include:

* Recognition that there is a need for labor-management cooperationto solve common problems.

* Identifiable and demonstrated commonality of interests* Joint focus on saving jobs, enhancing profitability, and increasing

market share.* Specific training for cooperation.* Consistent, face-to-face communication.* Specific recognition of accountability for all parties.* Recognizable, regular, available, responsible, facilitated processes

to deal with any type of situation.* Focus on progress, not perfection.* An understanding of the limitations and benefits of the contract from

which to build cooperative relations.* Active and consistent focus on getting beyond conflict and

‘baggage’ of days past.* Consistent follow-through on the part of both labor and

management.* Dedication of involved individuals.* A demonstrated willingness to let guards down and show

weaknesses to one another.* Strong leadership – a champion or champions.

Focus group participants identified two exemplary labor-managementcooperation initiatives in northeast Ohio where these basic elements couldeasily be seen: the initiatives at General Motors (Lordstown, Ohio, plant) andat Stein, Incorporated (four sites in Cuyahoga and Lorain Counties). Afterbriefly setting out the background and approach of these initiatives, the basicelements of a world-class labor-management relationship will be illustrated andexplained, using the preceding literature summary and then using the basicelements identified by practitioners.

Background and ApproachStein, Inc. in Lorain and Cuyahoga Counties. Stein is an on-site

contractor that removes slag, a by-product of steel-making. Their operations atlocal steel plants (LTV-East, LTV-West, and USS/KOBE) and theirmaintenance facility in Cleveland are part of larger company operations inOhio, Pennsylvania, and Arkansas. Locally, Stein employs approximately 250employees represented by the Steelworkers, Operating Engineers, Laborers,and Teamsters Unions. Labor relations were poor—traditionally adversarialbut not overly hostile—before 1996. Employees exhibited little commitment tothe workplace or to Stein and showed no trust that Stein’s business decisionswould benefit them. Labor relations were also considered distinct for each ofthe four labor organizations.

During the 1995 contract negotiations, the Operating Engineersshowed their concern for the relationship between their jobs and the company’sbusiness operations. They requested the formation of a labor-managementcommittee to improve operations and give employees more information about

Over the past couple ofOver the past couple ofOver the past couple ofOver the past couple ofOver the past couple ofyears, especiallyyears, especiallyyears, especiallyyears, especiallyyears, especially, a, a, a, a, a

“survival of the fittest“survival of the fittest“survival of the fittest“survival of the fittest“survival of the fittest”””””mentality hasmentality hasmentality hasmentality hasmentality has

pervaded the labor-pervaded the labor-pervaded the labor-pervaded the labor-pervaded the labor-managementmanagementmanagementmanagementmanagement

relationship atrelationship atrelationship atrelationship atrelationship atLordstown, pushingLordstown, pushingLordstown, pushingLordstown, pushingLordstown, pushingthe parties towardthe parties towardthe parties towardthe parties towardthe parties toward

more and moremore and moremore and moremore and moremore and morecooperative efforts.cooperative efforts.cooperative efforts.cooperative efforts.cooperative efforts.

22

and more participation in business decision-making that would affect their jobs.Because workplace safety was an obvious common concern for

employees and management, and because the Ohio Bureau of Workers’Compensation “retro” plan under which the company was operating demandedthat the company dramatically reduce accidents and injuries within a remainingseven years or face significant expense, safety was identified as the issue uponwhich to focus. The parties agreed that the contractually established labor-management committee would direct its attention toward reducing workplacehazards, accidents, and injuries, and toward reducing lost time and other costsof accidents. Because it was clearly in their best interest also, the other labororganizations—Teamsters, Steelworkers, and Laborers—agreed to partici-pate.

General Motors at LordstownBuilt in the mid-1960s, the Lordstown complex consists of a fabrication

plant and a separate assembly plant, the latter currently employing over 5,000union workers producing Chevrolet Cavaliers and Pontiac Sunfires.

Labor-management relations at the assembly plant were tumultuousand traditionally adversarial in the early 1970s, frequently punctuated withwildcat strikes and slowdowns as the union flexed its muscles and the plantmanagement resisted. With the Cavalier and Sunfire production of the mid-1980s, a maturing relationship, closure of the full-sized van assembly line,foreign competition, and GM’s emphasis on cost effectiveness and inter-plantcompetition, union and management were pushed to work together for mutualsurvival. Labor relations mellowed. There have been no strikes over localissues for several years.

Over the past couple of years, especially, a “survival of the fittest”mentality has pervaded the labor-management relationship at Lordstown,pushing the parties toward more and more cooperative efforts. Pressures tocooperate intensified when GM announced a five-year plan to introduce theDelta Project, a new small-car manufacturing platform, and began examiningalternative locations for production. For the first time, as current modelassembly was to be phased out and Delta Project assembly begun at some GMplant, the closing of Lordstown Assembly became a serious possibility.However, job security concerns were eased somewhat in the latter part of 1999when GM decided to maintain Cavalier and Sunfire production at Lordstownuntil at least 2005. Even so, the realization that the plant could have closedspurred unprecedented efforts by labor and management to hammer out a newcontract that focused on cost effectiveness and cooperation. The parties areseeking to overcome the hostile, adversarial labor relations image that the plantstill carries in spite of “labor peace” over the past few years.

Synthesis and DiscussionNature of the Initiative

The nature of Stein’s cooperative relationship is characterized as“Safety Always,” the name given to the joint safety management process inwhich they are engaged. GM’s relationship is characterized as the moregeneral “changing the way of doing business.”

These two casesThese two casesThese two casesThese two casesThese two caseseeeeexxxxxemplify twoemplify twoemplify twoemplify twoemplify twoendpoints on aendpoints on aendpoints on aendpoints on aendpoints on acontinuum notcontinuum notcontinuum notcontinuum notcontinuum notclearly defined inclearly defined inclearly defined inclearly defined inclearly defined inthe literature.the literature.the literature.the literature.the literature.

23

ProblemStein’s effort covers safety, communication issues, and some more

general labor-management issues. GM’s effort is designed to change thecontract as needed to increase productivity and lower costs.

ExtentStein’s effort covers health and safety problems at four sites within a

larger organization. GM’s initiative covers all problems at one site within alarger corporation.

FocusThese two cases exemplify two endpoints on a continuum not clearly

identified in the literature. Stein’s cooperative effort is very narrowly definedand focuses on a particular workplace issue. The cooperation was motivatedby general worker and union desire to influence more directly the operationaland financial decisions that affect current and future jobs, pay, and worklife.The impetus for cooperation was internally generated. Only after the effort wasformulated did safety emerge as a viable focus. The effort developed in anenvironment where cooperation was seen as a means to increase workerinvolvement and improve operations, not in an environment dominated withthreat of total company closure and total job loss.

By contrast, GM’s cooperative effort is broadly defined and focuses onplant and job survival and derivatively all of the workplace issues affecting “thebottom line.” Cooperation was never seen as a means of improvingperformance and relationships. It was always seen as absolutely essential forsaving the plant and jobs. The cooperation was motivated by the sharedrealization that inaction might realistically lead to plant closing and job loss. Theimpetus for cooperation came from without. When plant and job survival werenot so clearly at stake, the parties’ relationship showed few signs of non-forcedmovement toward cooperative relations. Instead, it showed a maturation of thetraditional adversarial labor-management relationship — an increase inacceptance, a reduction in extreme actions and reactions, and an increase inthe willingness to compromise.

GM was forced into a cooperative mode to save the plant and save jobsand so the effort there focuses on macro issues. Stein grew into a realizationthat cooperation could address a common problem, found one, and so theircooperative effort focuses on a micro issue.

With the foregoing descriptions and distinctions in mind, it is clear thatboth initiatives represent world-class labor-management relationships whenmeasured against elements of a model implementation of labor-managementcooperation gleaned from the literature and elements identified by practitionersin northeast Ohio.

Basic Elements from the Literature - Structure andComposition

1. Joint planning, administration, and evaluation -- joint stakeholdership.At both organizations, it is clear that workers and managementparticipate in the planning, administration, and evluation of cooperativeactivities as identifable stakeholders. At GM, it is absolutely clear that

At bothAt bothAt bothAt bothAt bothorganizations, it isorganizations, it isorganizations, it isorganizations, it isorganizations, it isclear that workclear that workclear that workclear that workclear that workersersersersersand managementand managementand managementand managementand management

participate inparticipate inparticipate inparticipate inparticipate inthe planningthe planningthe planningthe planningthe planning,,,,,

administration, andadministration, andadministration, andadministration, andadministration, andevaluation ofevaluation ofevaluation ofevaluation ofevaluation of

cooperativecooperativecooperativecooperativecooperativeactivities asactivities asactivities asactivities asactivities asidentifiableidentifiableidentifiableidentifiableidentifiable

stakstakstakstakstakeholders.eholders.eholders.eholders.eholders.

24

management, the union, and the workforce share the common goal ofplant and job preservation and that there are agreed upon, identifiableavenues through which everyone’s ideas, concerns, and interests canbe considered. Workers and their representatives at Stein developedand offered management a process wherein worker involvement couldincrease. The process directly met management’s concerns for workerhealth and safety and cost control. All parties see the evoluation ofSafety Always as under their joint control and leadership. All are clearlystakeholders in a joint process that neither union nor management forcedon the workplace.

2. Planning before implementation, including the development ofworking standards of consensus on the mission, goals and proceduresof LMC. At Stein, safety management policy is developed and adoptedby consensus at the Steering Committee level bfore implementation.Safety missions, goals, and procedures are clearly identified and agreedto. At Lordstown Assembly, the overriding goal of plant and job survivalis clear an unambiguous. Procedures, activities, and decisions affectingthe goal are developed at regular meetings at the plant, department,and area levels.

3. Equal representation of union and management. GM’s cooperativeeffort supports equal participation while Stein’s does not for anunderstandable reason. GM’s structure pairs the Union Chairman ofthe Bargaining Committee and Union President with the Plant Managerand Personnel Vice President, seven Zone Committeemen withDepartment Heads, and 32 Committeepeople with Area Managers.Stein’s structure must accommodate worker representatives from fourunions at four sites, resulting in significantly more union thanmanagement representation. This “imbalance,” however, isunderstood and accepted by all parties as the only way to ensure fullworker participation in the process.

4. Voluntary and non-exclusionary participation. At both organiza-tions, there are managers and worker representatives who do notparticipate in the cooperative process or who do not do soenthusiastically. At both organizations, not all of the workforceparticipates. At GM, rank and file worker participation is channeledthrough representatives within the union structure because of the“macro” nature of the problem being addressed. At Stein, workerparticipation in Safety Always is more direct as Workgroup ToolboxMeetings are intended to include all employees. Of course, there is stillparticipation through regular union channels. At both organizations, allparticipation is welcome, voluntary, and non-exclusionary.

5. Invulnerability to staff changes. At GM, union and managementleadership has been relatively stable throughout the current crisis. It islikely that should staff changes occur, however, the overridingimportance of the survival issue will quickly guide replacement staff intothe same collaborative stance adopted by their colleagues. At Stein, a

Through LMC, it isThrough LMC, it isThrough LMC, it isThrough LMC, it isThrough LMC, it ispossible to enhancepossible to enhancepossible to enhancepossible to enhancepossible to enhancecontractuallycontractuallycontractuallycontractuallycontractuallymandated efforts bymandated efforts bymandated efforts bymandated efforts bymandated efforts byagreeing to alternativeagreeing to alternativeagreeing to alternativeagreeing to alternativeagreeing to alternativeinterpretations ofinterpretations ofinterpretations ofinterpretations ofinterpretations ofvery specificvery specificvery specificvery specificvery specificcontract clauses.contract clauses.contract clauses.contract clauses.contract clauses.

25

firm management commitment to the cooperative process and a labor-management commitment to group process training of all participantsensures that, as union and management leaders and supporterschange, replacements will quickly rise to the same level of effectivenessas the colleagues they join. Additionally, Stein used the services of athird-party neutral to guide and support Safety Always so that theprocess was shielded from some of the halting confusion that internalstaff changes might bring as the process developed.

6. A clear distinction between the issues addressed through LMC andthose addressed through collective bargaining. This clear distinctiondoes not exist at either organization. By agreement at LordstownAssembly, the labor contract has become a living document, changingshape to accommodate the overall survival goal. There, because of the“macro” nature of the agreed mission, the line between bargaining andcooperation in decision-making is intentionally blurred. Safety is acontractual issue at Stein. Since all concurred that contractual effortsto improve workplace health and safety were ineffective, however, theparties agreed to interpret the contract language broadly so as to allowa collaborative effort to address the issue. There, because of the“micro” scope of the mission, it was possible to enhance contractuallymandated efforts by agreeing to alternative interpretations of veryspecific contract clauses.

7. Forums for open discussion and joint problem-solving toaccommodate diverse interests. There are parallel forums at the twoorganizations. Stein’s Safety Always process includes a GeneralSteering Committee charged with policy development and oversight,four Site Committees charged with problem-solving of site issues withinbroader safety management policies, and Workgroup ToolboxMeetings at all sites where the focus is dissemination of safetyinformation and two-way communication/discussion of employeeconcerns and improvement ideas. GM’s cooperative structure is alsovertical, but less precisely defined. The Union Bargaining CommitteeChairman and Union President interact regularly with the PlantManager and Personnel Vice President to map general policy andpolicy changes as issues develop. Seven Union Zone Committeemeninteract regularly with their respective Department Heads, and 32 UnionCommitteemen meet regularly with Area Managers to discuss majorissues and solve problems.

8. System of evaluation and clear measures of goals and outcomes.Stein’s Safety Always initiative, because of its narrow focus, has clearlymeasurable goals and outcomes—lost time, incidents, “near misses,”and the like—and incorporates an appropriate evaluation mechanism.The “macro” nature of the GM initiative supports but one goal—maintenance of plant operation and employment that provides no clearintermediate, measurable outcomes until a final decision is made. Ofcourse, agreements to “change the way of doing business” can beevaluated for their contribution to cost reduction and productivity

Stein supports aStein supports aStein supports aStein supports aStein supports asafety incentivesafety incentivesafety incentivesafety incentivesafety incentive

program that rewardsprogram that rewardsprogram that rewardsprogram that rewardsprogram that rewardsall workall workall workall workall workers forers forers forers forers for

progress towardprogress towardprogress towardprogress towardprogress towardsafety goals as well assafety goals as well assafety goals as well assafety goals as well assafety goals as well as

specific workspecific workspecific workspecific workspecific workers whoers whoers whoers whoers whocontribute directlycontribute directlycontribute directlycontribute directlycontribute directly

toward this progress.toward this progress.toward this progress.toward this progress.toward this progress.

26

enhancement, but the effect of these measures on the final corporatedecision about Lordstown Assembly is not clearly and universallyunderstood.

9. System of gain-sharing. Because of the scope of the problem atLordstown Assembly, there is no system of gain-sharing beyond thegeneral realization that if collaborative efforts result in a corporatedecision to bring another production line to Lordstown or to continueproduction of the present models (which they have decided to do),there will be mutual gains—jobs and income—for the workforce and forthe region. Similarly, because of the scope of the problem addressed,Stein supports a safety incentive program that rewards all workers forprogress toward safety goals as well as specific workers who contributedirectly toward this progress.

10. Provisions to ensure employment security and good workingconditions. The cooperative effort at Stein directly addresses a keyaspect of working conditions, namely a hazard-free workplace. To theextent that improved working conditions generate enhanced workercommitment and effectiveness that results in better customer service,employment security is improved. At GM, employment security is themajor issue and is addressed directly through cooperative efforts tolower costs and improve productivity within the four corners of the laborcontract. Also within the contract are the means for ensuring thatworking conditions are “good.”

11. Decentralization of activities—activities present at all levels of theorganization. Multi-level activities at both organizations as previouslydescribed.

Basic Elements from the Literature - OrganizationalEnvironment

1. The integration of activities into the organizational structure of thefirm – an organization-wide culture of commitment. As far as safety isconcerned, cooperative safety management is an accepted elementwithin Stein’s organizational culture. There is top management andunion commitment to the process, worker involvement at all levels, andclear measures of workplace and financial improvements stemmingfrom the process. At Lordstown Assembly, the commitment is lessspecific, but identifiable. At all levels, management and unionrepresentatives are meeting, discussing, problem-solving, andproposing changes in contract language to support the mission of plantand job retention. At the same time, however, there continues to be aconsistent and more traditional reliance on the labor agreement toorchestrate the day-to-day labor-management relations at the plant.Commitment is plant-wide, but focused on a basic goal — continuedexistence of the assembly plant. It appears that because of themagnitude and timing of the corporate decision that triggered thiscooperative effort, little attention is, can be, or should be currently

CorporateCorporateCorporateCorporateCorporatestrategies shouldstrategies shouldstrategies shouldstrategies shouldstrategies shouldreflect a commitmentreflect a commitmentreflect a commitmentreflect a commitmentreflect a commitmentto employees andto employees andto employees andto employees andto employees andthe mission ofthe mission ofthe mission ofthe mission ofthe mission ofcooperationcooperationcooperationcooperationcooperation

27

directed toward aspects of the labor-management relationship beyondthose directly affecting cost and productivity and the retention of theplant beyond 2005.

2. An organizational culture that views and treats employees asvalued stakeholders. Stein’s Safety Always process treats all workersas valued members of the organization. A slight pay differentialrewards active participants for their time commitment. All workers aregiven a forum — the Workgroup Toolbox Meetings — for transmission,exchange, and appreciation of ideas, concerns, and interests revolvingaround safety and health. At the present time, however, other aspectsof Stein’s operation do not meet the standard for recognizedstakeholdership set by the Safety Always process. GM’s cooperativeinitiative to save the assembly plant and its jobs recognizes workers asresources whose commitment is crucial to goal attainment. The short-term nature of the initiative, however, understandably constrains theadoption of a stakeholder attitude to the immediate issue and does littleto expand it into other aspects of workplace relations. ShouldLordstown Assembly remain viable beyond 2005, there will be a firmbasis for the broadening of that stakeholder attitude to other aspects ofthe union-management relationship.

3. Incentive- or performance-based compensation that reflects thespirit of cooperation. Because of the nature of the initiative, Stein is ableto offer safety incentives to the organization and to specific workers whodirectly contribute toward safety goals. Additionally, the company canand does offer financial rewards recognizing time spent in thecooperative process. Exactly because of the nature of the initiative andthe structure of the union-management relationship, GM understand-ably does not offer similar compensation. The prospect for continuedemployment resulting from cooperative efforts to reduce costs andincrease productivity under a living labor agreement certainly is,however, a recognizable, though not precise, form of compensationstemming from cooperation.

4. Corporate strategies that reflect a commitment to employees andthe mission of cooperation. Stein’s micro focus on cooperative safetyand its relatively recent introduction is not sufficient to generate broadcorporate strategies reflecting commitment to employees andcooperation. As the Safety Always initiative matures, however,expansion of cooperative efforts to other aspects of company operationmay eventually generate such strategies. At Lordstown Assembly, theacknowledged breadth of the cooperative effort to retain productionand employment must be understood within the broader corporateenvironment that supports a competitive “survival of the fittest”philosophy among assembly plants. In the broader corporateenvironment, the cooperative efforts at Lordstown and other GM plantshave been, as yet, insufficient to generate corporate strategies thatsupport commitment to a mission of cooperation.

...both GM and Stein...both GM and Stein...both GM and Stein...both GM and Stein...both GM and Steinembrace the elementsembrace the elementsembrace the elementsembrace the elementsembrace the elements

of a world-of a world-of a world-of a world-of a world-classclassclassclassclassimplementation ofimplementation ofimplementation ofimplementation ofimplementation of

labor-managementlabor-managementlabor-managementlabor-managementlabor-managementcooperationcooperationcooperationcooperationcooperation

embedded in theembedded in theembedded in theembedded in theembedded in thescholarly literature.scholarly literature.scholarly literature.scholarly literature.scholarly literature.

28

5. Trust and commitment on the part of both union and management– strong bilateral leadership as an example for participants. Withoutreiterating what has already been said, it is clear that leadership at Steinand at Lordstown Assembly has been strong and unwavering in theirsupport of the cooperative processes and stand out as role models fortheir respective workforces.

6. Strong and open flows of information within the organization. Bothfinancial and operating information has been comprehensive andreadily available to participants in the cooperative process at LordstownAssembly. At Stein, information relevant to safety has also beencomprehensive and available within the Safety Always process. It isunderstandable that within the limited scope of a cooperative safetymanagement process, information would and does flow freely. It ismuch less understandable and therefore significant that at GM, with abroad and relatively short-term cooperative mission and adversarial“baggage,” financial and operating information flows so freely. Indeed,the availability and free flow of information is a hallmark of that effort.

7. Substantial opportunities for training and development in both theskills required for LMC and the skills required by the workplace. SafetyAlways includes a commitment to cooperative process training andretraining. The process itself identifies and arranges for specific safetytraining, information dissemination, and discussion, as required. Theshort-term nature of the GM initiative understandably makes nocommitment to process training, but skill training and retraining is anidentifiable by-product of cost reduction and productivity improvementmeasures.

Reflecting on the preceding description and analysis, it is clear that both GMand Stein embrace the elements of a world-class implementation of labor-management cooperation embedded in the scholarly literature.

Basic Elements from the Focus GroupA focus group comprised of northeast Ohio union and management

advocates identified a different set of basic elements of a world-classimplementation of labor-management cooperation than found in the literature. What follows is a brief accounting of whether or notthe two exemplary labor-management cooperation initiatives in northeast Ohioalso reflect these practitioners’ idea of what makes a world-class labor-management relationship.

1. Recognition that there is a need for labor-management cooperation tosolve common problems.a. Stein: Yes.b. GM: Yes.

2. Identifiable and demonstrated commonality of interests.a. Stein: Yes.b. GM: Yes.

Some elements of aSome elements of aSome elements of aSome elements of aSome elements of aworld-world-world-world-world-class labor-class labor-class labor-class labor-class labor-managementmanagementmanagementmanagementmanagementrelationship identitiedrelationship identitiedrelationship identitiedrelationship identitiedrelationship identitiedby focus groupby focus groupby focus groupby focus groupby focus groupmembers includemembers includemembers includemembers includemembers includeconsistentconsistentconsistentconsistentconsistentfollowfollowfollowfollowfollow-through by-through by-through by-through by-through byboth parties andboth parties andboth parties andboth parties andboth parties andspecific recognitionspecific recognitionspecific recognitionspecific recognitionspecific recognitionof accountabilityof accountabilityof accountabilityof accountabilityof accountabilityfor all parties.for all parties.for all parties.for all parties.for all parties.

29

3. Joint focus on saving jobs, enhancing profitability, increasing marketshare.a. Stein: Yes.b. GM: Yes.

4. Specific training for cooperation.a. Stein: Yes.b. GM: No.

5. Consistent, face-to-face communication.a. Stein: Yes.b. GM: Yes.

6. Specific recognition of accountability for all parties.a. Stein: Yes.b. GM: Yes.

7. Recognizable, regular, available, responsible, facilitated processes todeal with any type of situation.a. Stein: Yes.b. GM: No.

8. Focus on progress, not perfection.a. Stein: Yes.b. GM: Yes.

9. An understanding of the limitations and benefits of the contract fromwhich to build cooperative relations.a. Stein: Yes.b. GM: Yes.

. 10. Active and consistent focus on getting beyond conflict and ‘”baggage” of days past.a. Stein: Yes.b. GM: Yes.

11. Consistent follow-through on the part of both labor and management.a. Stein: Yes.b. GM: Yes.

12. Dedication of involved individuals.a. Stein: Yes.b. GM: Yes.

13. A demonstrated willingness to let guards down and show weaknessesto one another.a. Stein: Yes.b. GM: No data.

The literatureThe literatureThe literatureThe literatureThe literaturereview stronglyreview stronglyreview stronglyreview stronglyreview strongly

suggests that ansuggests that ansuggests that ansuggests that ansuggests that animportant ingredientimportant ingredientimportant ingredientimportant ingredientimportant ingredientin developing world-in developing world-in developing world-in developing world-in developing world-

class labor-class labor-class labor-class labor-class labor-managementmanagementmanagementmanagementmanagement

cooperation is thecooperation is thecooperation is thecooperation is thecooperation is theeeeeexistence of otherxistence of otherxistence of otherxistence of otherxistence of other

organizations thatorganizations thatorganizations thatorganizations thatorganizations thatprovide a friendlyprovide a friendlyprovide a friendlyprovide a friendlyprovide a friendly

and supportiveand supportiveand supportiveand supportiveand supportiveinfrastructure.infrastructure.infrastructure.infrastructure.infrastructure.

30

14. Strong leadership – a champion or champions.a. Stein: Yes.b. GM: Yes.

SummaryIt is clear that both Stein’s and GM’s cooperative efforts reported here

directly reflect and verify the basic structure, composition, organizationalenvironment, and personal elements that both scholars and practitioners havecited as necessary for effective, world-class labor-management relationships.This is not surprising, since they were identified by practitioners as exemplary.

Each effort, however, incorporates the preponderance of key elementsin differing ways, not necessarily in differing degrees. For example, bothorganizations are fully committed to voluntary and non-exclusionaryparticipation in the cooperative process. Because GM has been confronting a“macro” plant survival problem, participation is channeled throughrepresentatives within the union structure. Because Stein is confronting alonger term “micro” workplace issue, participation is more direct through a jointproblem-solving structure that has evolved apart from the existing unionstructure. Both organizations support worker participation in significantlydifferent ways, not in different degrees, although a casual evaluation mightsuggest otherwise.

It is necessary, but not sufficient, to evaluate labor-managementcooperative activities by applying these key elements of a world-classrelationship carefully and objectively. It is necessary, but not sufficient, tonurture and support cooperative labor-management activities as a public policyobjective by carefully and objectively promoting these key elements. Whatthese cases have shown is that to produce credible analytic and public policyresults, it is also necessary to understand the key elements of world-classcooperation within a context set by the unique history, nature, problem(s),scope, extent, and focus of the labor-management relationship and thecooperative initiative. To do so requires a case-by-case approach that relies ona multi-disciplinary grasp of labor-management relations.

Almost 65 years ago, Congress established the National LaborRelations Board to administer and adjudicate federal law governing laborrelations. Congress chose a board of labor relations experts for this task ratherthan entrusting responsibility to the courts because they felt that only expertscould fully understand the unique circumstances of the labor-managementrelationship. As public policy focuses more and more on labor-managementcooperation as a tool for enhanced quality, productivity, and economicdevelopment, it remains true that a full understanding and appreciation of thelabor-management relationship will be necessary for the development andimplementation of effective public policy.

The literature review strongly suggests that an important ingredient indeveloping world-class labor-management cooperation is the existence ofother organizations that provide a friendly and supportive infrastructure, onethat provides a catalyst for involving not just labor and management, buteducators, politicians and the community as well. The next section looks at thatinfrastructure in the State of Ohio: the Ohio Labor-Management CooperationProgram.

The Ohio Labor-The Ohio Labor-The Ohio Labor-The Ohio Labor-The Ohio Labor-ManagementManagementManagementManagementManagementCooperationCooperationCooperationCooperationCooperationProgram of the OhioProgram of the OhioProgram of the OhioProgram of the OhioProgram of the OhioDepartment ofDepartment ofDepartment ofDepartment ofDepartment ofDevelopment wasDevelopment wasDevelopment wasDevelopment wasDevelopment wasestablishedestablishedestablishedestablishedestablishedin 1984.in 1984.in 1984.in 1984.in 1984.

31

4. The Ohio Labor-Management4. The Ohio Labor-Management4. The Ohio Labor-Management4. The Ohio Labor-Management4. The Ohio Labor-ManagementCooperation ProgramCooperation ProgramCooperation ProgramCooperation ProgramCooperation Program

There are many variables that go into the mix when companies aretrying to decide where to build a new plant, whether to expand or cut back anexisting facility, or to close a plant. Certainly one of the most important variablesis the state of labor-management relations. A positive labor-managementenvironment is critical. Labor-management cooperation is a real plus for theprofitability of the manufacturing companies that are so important to the Stateof Ohio and to service organizations as well, because without good workingrelationships between labor and management, union representatives and theircorporate counterparts can wind up in combat with each other when they reallyshould be channeling their efforts into competing with other domestic andforeign firms.

While labor-management cooperation in the workplace has alwaysbeen eminently desirable, it is especially necessary in the increasinglycompetitive international market in which American companies must nowoperate. The maintenance of a strong manufacturing base has long been thecornerstone of the prosperity of the State of Ohio and the well-being of itscitizens. This is no less true today. While growth in the service and publicsectors of Ohio’s economy are also important to maintaining the standard ofliving in the state, it is competitive manufacturing firms that secure employmentand support the majority of service jobs. Programs that can build onmanagement’s initiative and labor’s involvement in solving problems andimproving competitiveness are unquestionably a significant force in advancingeconomic growth. For example, modern continuous improvement strategiessuch as High Performance Work Systems must have this type of cooperationif they are to be effective.

The National Governors’ Association’s “Promoting Quality Business”action agenda has laid out a strategic plan to increase the competitiveness offirms. This agenda outlines ways in which a public-private partnership of keystate leaders from government, industry, labor, education, and nonprofitorganizations can bring together the resources and expertise of the decisionmakers to garner support for quality management practices and the creation ofa culture of excellence (Conrad 1997). A state policy that promotes totalquality, high commitment, and high involvement workplaces would foster acomprehensive range of needed services available to firms by building on anexisting network already providing those services. In Ohio, that existingnetwork is the Ohio Labor-Management Cooperation Program (OLMCP).

The Origins and Development of the Ohio Labor-Management Cooperation Program88888

The Ohio Labor-Management Cooperation Program (OLMCP) of theOhio Department of Development was established in 1984 during theadministration of then-governor Dick Celeste as part of a long-term economicdevelopment strategy to bolster Ohio’s competitive position in the globalmarketplace and to fulfill a campaign pledge to put together a job creation andretention strategy that would address the fact that Ohio’s industrial base wasshrinking. Originally, the Celeste Administration was looking at a centralizedprogram focused on research to be done at Ohio State University’s Labor

The program...The program...The program...The program...The program...drew on thedrew on thedrew on thedrew on thedrew on the

collective wisdom andcollective wisdom andcollective wisdom andcollective wisdom andcollective wisdom andtalents of labortalents of labortalents of labortalents of labortalents of labor,,,,,

management, andmanagement, andmanagement, andmanagement, andmanagement, andgovernment to providegovernment to providegovernment to providegovernment to providegovernment to provide

a forum for thea forum for thea forum for thea forum for thea forum for theparties to identifyparties to identifyparties to identifyparties to identifyparties to identify

and jointly addressand jointly addressand jointly addressand jointly addressand jointly addressissues of communityissues of communityissues of communityissues of communityissues of community

interest and fosterinterest and fosterinterest and fosterinterest and fosterinterest and fostereconomiceconomiceconomiceconomiceconomic

development throughdevelopment throughdevelopment throughdevelopment throughdevelopment throughbetter workplacebetter workplacebetter workplacebetter workplacebetter workplace

relations.relations.relations.relations.relations.

32

Education Research Center in Columbus. The Governor, however, had alsoset up a “Labor-Management/Productivity Kitchen Cabinet” to further considerthe question of labor management cooperation in the state. The “KitchenCabinet” was headed by Alfred Dietzel, Director of the Department ofDevelopment and former chief of the Columbus Chamber of Commerce, andWarren Smith, Director of the Department of Transportation, who came to theposition from the Ohio AFL-CIO. The Cabinet was made up of nine individualsrepresenting business, labor, and The Ohio State University. Over a series ofmeetings, the Kitchen Cabinet essentially reshaped the program into a plan toestablish state, regional, and local labor management centers to conductresearch, provide technical assistance, and build local support for labor-management cooperation in economic development efforts. With the movetoward decentralization of the program came a change in emphasis fromresearch to service delivery. Celeste was quoted as saying that “It is like theAgricultural Extension Service. We’ve created a labor-management extensionservice that people can draw on.”

The program was not fully enacted until mid-1985, and it was not untilMay 1986 that the first program grants were made. Karen Schwarzwalder wasthe first head of the Office of Labor-Management Cooperation. She wassucceeded later in 1986 by Miriam Schenkenberger, who was in turnsucceeded by Karen M. Conrad. Conrad has actually had two tours of duty withthe program. She was manager of the program for a short period beginning inJuly 1991, and was succeeded by Pat Hammel for a short time before beingreappointed in 1992. Conrad has been manager of the OLMCP since that time.

Two members of Governor Celeste’s “Kitchen Cabinet” who had a handin the shaping of Ohio’s Labor-Management Cooperation Program are stillinvolved in the program -- one person from management and one from labor.Bob Meyer, who had been Babcock & Wilcox’s Director of Productivity, was theDirector of the Work In Northeast Ohio Council (WINOC) at the time; hecontinues in that position today. WINOC is home to the Northeast Ohio Centerfor Labor-Management Cooperation. Joe Tomasi of the Northwest OhioCenter for Labor-Management Cooperation at the University of Toledo was, atthe time of his service on the Kitchen Cabinet, Director of the United AutoWorkers, Region 2B.

The program, as it was established, drew on the collective wisdom andtalents of labor, management, and government to provide a forum for theparties to identify and jointly address issues of community interest and fostereconomic development through better workplace relations. During the CelesteAdministration, this forum was provided on a continuing basis by a statewideTripartite Committee for Labor-Management Cooperation, established byexecutive order in November 1985, which also came to oversee programadministration. The May 1986 grants established 12 Area Labor-ManagementCommittees (ALMCs) and six regional Centers. In 1987, four additionalALMCs, two additional regional Centers, and two Employee OwnershipCenters were established. The number of ALMCs and Centers supported hasvaried over the years, but there has been a long term decline in the number ofcenters to the current five.

The OLMCP quickly became an important symbol that Ohio was makingevery effort to become a good place to do business. Indeed, initially severalimportant union leaders expressed grave skepticism of its assumed pro-business leanings, and there was some conflict among the staff of various

Since the inceptionSince the inceptionSince the inceptionSince the inceptionSince the inceptionof the OLMCPof the OLMCPof the OLMCPof the OLMCPof the OLMCP, Ohio, Ohio, Ohio, Ohio, Ohiohas invested morehas invested morehas invested morehas invested morehas invested morethan $18 million andthan $18 million andthan $18 million andthan $18 million andthan $18 million anda considerable amounta considerable amounta considerable amounta considerable amounta considerable amountof time and effort inof time and effort inof time and effort inof time and effort inof time and effort inthe promotion andthe promotion andthe promotion andthe promotion andthe promotion andimplementation ofimplementation ofimplementation ofimplementation ofimplementation oflabor-managementlabor-managementlabor-managementlabor-managementlabor-managementcooperation concepts.cooperation concepts.cooperation concepts.cooperation concepts.cooperation concepts.

33

ALMCs and Centers about whether the program should focus on servingbusiness or labor. In time, however, it became clear that it served eachconstituency best by serving both in common, and it became an effectivemechanism for improving labor-management relations.

Although the OLMCP, in its origins, was clearly a Celeste Administrationprogram, it was proven a sufficiently successful economic developmentprogram and sufficiently neutral third party program between labor andmanagement to be continued under Republican Governor George Voinovichafter he took office in 1991. However, a number of changes were made in theprogram, including the abolition of the Tripartite Committee, a reduction of theColumbus staff from three to one, an increased emphasis on raising matchingfunds, and some pruning of weaker programs through a more rigorous annualreview of each ALMC and Center.

During the start-up period between 1987 and 1990, the program wasfunded at $2 million annually. With the Voinovich administration, funding wascut in a series of steps from that level to about $1.2 million annually by the endof the Voinovich administration. This reduction in state funding reflected boththe maturation of the program and concomitant reduction in costs in Columbus9

and, outside Columbus, the reduction of the number of university-basedCenters.

Structure of the ProgramSince the inception of the OLMCP, Ohio has invested more than $18

million and a considerable amount of time and effort in the promotion andimplementation of labor-management cooperation concepts. This significantinvestment has now evolved into a statewide system of five geographicallysituated Centers for the Advancement of Labor-Management Cooperation and11 Area Labor-Management Committees (ALMCs) spread throughout thestate. A solid foundation for the improvement of workplace practices and achange in the direction of work and labor-management relations has been theresult. The program has been an effective economic development tool since ithelps to solidify existing industry more firmly in their local communities whileretaining and growing the number of well-paying white and blue-collar jobs.

The Centers, in established universities and nonprofit traininginstitutions, have become sources of applied training and developmentexpertise that concentrate on enhancing cooperative work practices bydeveloping and offering public workshops and assisting the Area Labor-Management Committees in training workers.

The ALMCs, in turn, are the grassroots public-private partnerships that,among other things, serve as a forum for local labor and managementorganizations to identify and jointly act upon community economicdevelopment concerns. Many of them have collaborated with chambers ofcommerce, labor bodies, private industry councils, and other local andstatewide community economic development organizations on retention andexpansion efforts. In addition to sponsoring and conducting workshops,ALMCs coordinate closely with centers to design and implement employeeinvolvement programs in industrial and service sector businesses as well as inthe public sector. The OLMCP is coordinated by a program manager inColumbus who administers the program on a daily basis, convenes quarterlymeetings of ALMC and Center staff, and conducts annual reviews of each ofthe ALMCs and Centers.

The ALMCs focus theirThe ALMCs focus theirThe ALMCs focus theirThe ALMCs focus theirThe ALMCs focus theiractivity on creatingactivity on creatingactivity on creatingactivity on creatingactivity on creating

networks, educationalnetworks, educationalnetworks, educationalnetworks, educationalnetworks, educationalcurriculum, in-plantcurriculum, in-plantcurriculum, in-plantcurriculum, in-plantcurriculum, in-plant

programs, markprograms, markprograms, markprograms, markprograms, marketingetingetingetingetingprogram activities,program activities,program activities,program activities,program activities,

professional and staffprofessional and staffprofessional and staffprofessional and staffprofessional and staffdevelopment, research/development, research/development, research/development, research/development, research/

case studies, targetedcase studies, targetedcase studies, targetedcase studies, targetedcase studies, targetedprograms, andprograms, andprograms, andprograms, andprograms, and

training smaller firms.training smaller firms.training smaller firms.training smaller firms.training smaller firms.

34

Program FocusThe current foci of the program have developed with the growing

experience of the OLMCP staff. Initially most energy went into information,organizing, outreach, and writing case studies. Beginning in 1989, theDepartment of Labor’s Bureau of Labor-Management Relations andCooperative Programs transferred their training technology in committeeeffectiveness and group process training, and the ALMC and Center staffbegan to do more in-company work. In the mid-1990s, the OLMCP collectivelyundertook joint labor-management safety committee training as part of theOhio Bureau of Workers Compensation “Safety Always” program. From 1996through 1998, a number of centers and several committees worked together toconvert their best training programs into a train-the-trainer format with thesupport of the Federal Mediation and Conciliation Service (FMCS). This waspiloted in 1997-98 for the Ohio ALMC and Center staff members’ professionaldevelopment. In this period, the OLMCP’s cooperative endeavors with bothFMCS and State Employment Relations Board (SERB) expanded with the co-sponsorship of the annual Buckeye Labor-Management conference; SERBstaff also participated in the piloting of the professional developmentcurriculum.

Currently, the Centers and the ALMCs focus their activity in thefollowing areas:

Creating NetworksLabor-management centers and committees serve as a catalyst in the

creation of labor-management-government networks in their regions and intheir communities. Professional labor-management networks help introducefacilitators to employee involvement approaches. Industrial networks haveprovided similar benefits in such sectors as the building and construction tradesand education.

Educational CurriculumUniversity-based centers and committees introduce the concept of

labor-management cooperation and employee involvement to students andincorporate cooperative models in the curriculum. Committees and centersdevelop programs for both primary and secondary schools on labor-management-government relations and conflict resolution.

In-plant ProgramsIn-plant work has been and continues to be a major emphasis for this

program and has proven to be one of the best ways to encourage a positivelabor relations climate. Centers and committees introduce the concepts oflabor-management-government cooperation in their communities and help setup joint labor-management employee involvement programs at work sites.

Marketing Program ActivitiesIncreasing community awareness with labor-management cooperation

success stories helps the work of Centers and committees and promotes theconcept of labor-management-government cooperation as a competitive tool.

The Centers and theThe Centers and theThe Centers and theThe Centers and theThe Centers and theALMCs have providedALMCs have providedALMCs have providedALMCs have providedALMCs have providedoutreach to more thanoutreach to more thanoutreach to more thanoutreach to more thanoutreach to more than100,000 employees.100,000 employees.100,000 employees.100,000 employees.100,000 employees.

35

Professional Staff DevelopmentFollowing the end of the FMCS-funded professional training for ALMC

and center staff, the Center at Wright State University has undertaken thecreation of the Partnership Resource Institute to continue professional staffand advisory board training.

Research/Case StudiesInformation on the climate of local labor and cooperative workplace

models are distributed throughout Ohio.

Targeted ProgramsCenters and committees are aware of critical issues facing labor,

management, and government. Programs and activities address current topicssuch as health care cost containment, environmental protection, andworkplace literacy.

Training Smaller FirmsTraining programs are offered to companies that cannot support large

training budgets or staffs. Centers and committees identify training needs ofsmaller and medium-sized companies and develop programs responding tothose needs. Facilitator and problem-solving training are examples.

Impact of the Ohio Labor-Management Cooperation ProgramSince January 1991, the Centers and the ALMCs have together

provided workplace assessments, helped to implement high-performancework systems by setting up and training teams and/or employee involvementgroups and played a significant role in improving labor-managementcooperation in more than 700 manufacturing companies, serviceorganizations, schools, healthcare organizations, and local governmentbodies. In-plant training fees provided through OLMCP have averaged lessthan half those normally charged by consulting firms. Taken together, theCenters and the ALMCs have provided outreach to more than 100,000employees and have helped to make their jobs more secure and theircompanies more competitive. In addition, 12,000 individuals representing2,000 companies with in excess of 200,000 employees have received trainingthrough grantee public workshops. The cost for a one-day workshop hasaveraged just one-third the cost charged by other training organizations.

Looking at it from another angle, the State of Ohio invests about $1.2million annually in grants that are leveraged by locally raised funds. In return,training and consulting services worth more than $5 million are made availableto local companies and others each year. This is a very cost effective programto say the least.

What Have the Centers and the ALMCs Done?The state-funded centers and the ALMCs are spread throughout the

State of Ohio. Each has made considerable contributions in enhancing labor-management cooperation and has directly influenced job retention in theirrespective areas.

TTTTTodayodayodayodayoday, the OLMCP, the OLMCP, the OLMCP, the OLMCP, the OLMCPnetwork consists ofnetwork consists ofnetwork consists ofnetwork consists ofnetwork consists of

two specialty centers,two specialty centers,two specialty centers,two specialty centers,two specialty centers,three regional labor-three regional labor-three regional labor-three regional labor-three regional labor-

managementmanagementmanagementmanagementmanagementcooperation centers,cooperation centers,cooperation centers,cooperation centers,cooperation centers,and 11 Area and 11 Area and 11 Area and 11 Area and 11 Area Labor-Labor-Labor-Labor-Labor-

ManagementManagementManagementManagementManagementCommittees.Committees.Committees.Committees.Committees.

36

Figure 1. Structure of the OLMCP in 2000

Ohio Labor-Management Cooperation programOhio Department of Development

Specialty Centers Regional Centers

WorkforceRelations Institute

(Lorain CountyCommunity College)

Ohio EmployeeOwnership Center

(Kent State University)

Northwest OhioCenter

(University ofToledo)

Center forPerformance

Excellence (WrightState University)

Area Labor-Management Committees

Area Labor-Management Council of EastCentral Ohio (Zanesville)Columbus Area Labor-ManagementCouncil (Columbus)Employee Participation Council of NorthCentral Ohio (MansfieldLabor Management Resource Network(Hamilton)Lima Area Labor-Management Council(Lima)Southwest Ohio Working Network(Dayton)

Mahoning Valley Labor-ManagementCouncil (Youngtstown)Ross County Area Labor-ManagementCouncil (Chillicothe)Stark County Labor-ManagementCouncil (Canton)Tuscarawas County Labor-ManagementCouncil (New Philadelphia)Great Lakes Organized Labor-Management Council (Elyria)

Joint Labor-Management In-Plant Committees

Northeast Ohio Center(WINOC)

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Initially the network was hierarchical, paternalistic, and carefullystructured. It consisted of regional centers that helped to establish and supportALMCs in their catchment areas; the committees, in their turn, supported plant-level labor management cooperation committees. Over time, that system hasevolved with the growing professionalism of the ALMC staff into a lesshierarchical system, with more of the centers having specialized, statewidetasks, and a number of committees assisting each other as a genuine networkin the provision of services.

Today the OLMCP network consists of two specialty centers withspecialized functions, three regional labor-management cooperation centers(including one with a statewide training function for ALMC and center staff), and11 Area Labor-Management Committees. For this historical evolution, seeFigure 1 (on following page).

The following recitation of the achievements and accomplishments ofeach of the members of the OLMCP network represents the period fromJanuary 1991 to the present.10

Specialty CentersThe Workplace Relations Institute, newly created and based at

Lorain County Community College, provides education, training, technicalassistance, and applied research for students, public and private sectoremployers, their employees, labor organizations, area labor-managementcommittees, and the public. As a neutral resource, the Institute works toeducate students for careers in human resource management and labor-management relations, to improve employer-employee and employer-unionrelations through on-site programs, training and technical assistance, and todisseminate current information and research findings to the professionalcommunity through conferences and workshops. The Institute seeks toimprove workplace relations and organizational effectiveness, quality,productivity, service, quality of worklife, and economic developmentthroughout Ohio.

The Ohio Employee Ownership Center (OEOC) at Kent StateUniversity has provided assistance to about 380 employee and/ormanagement groups and companies that were considering the option ofemployee ownership as a strategy to secure prosperous businesses and jobsin Ohio. As a result of that assistance, some 51 of these firms employing over10,900 people subsequently adopted employee stock ownership plans(ESOPs).

The Center has also established Ohio’s Employee-Owned Network, aconsortium of more than 60 employee-owned companies that participate inmonthly workshops. Approximately 450 employee owners -- shop flooremployees as well as salaried and management employees, including CEOs -- participate in these one-to-three day programs each year. In addition, theOEOC has conducted company-specific training programs on employeeownership issues in more than 25 Ohio employee-owned companies.

The OEOC has also received international recognition through itsproject to help Russian and Hungarian businesses privatize through the vehicleof employee ownership; that project has been financed by the MacArthur andEurasia Foundations and by the United States Agency for InternationalDevelopment (USAID).

As the ALMC networkAs the ALMC networkAs the ALMC networkAs the ALMC networkAs the ALMC networkhas become stable,has become stable,has become stable,has become stable,has become stable,

the regional centersthe regional centersthe regional centersthe regional centersthe regional centershave declined inhave declined inhave declined inhave declined inhave declined in

number andnumber andnumber andnumber andnumber anddiversified theirdiversified theirdiversified theirdiversified theirdiversified their

functions.functions.functions.functions.functions.

38

The Center has teamed up with the Greater Cleveland GrowthAssociation’s Council of Smaller Enterprises to provide a comprehensiveseries of succession planning seminars to business owners in Northeast Ohio.The program is an effective method of retaining jobs that would otherwise belost from the failure to plan for succession. In terms of the program’s reach, inthe 1997-99 period, 250 owners and managers from 200 companies havetaken part in the seminars, which cover a range of topics related to successionplanning. These companies have a total of more than 20,000 employees.

If the Center’s state grant is divided through by the number of jobssaved or stabilized, the cost per job is in the neighborhood of $130, making theCenter a very cost effective component of the state’s economic developmentefforts. To support its program, the Center leverages more than $2 in privatesector funding for every $1 that it receives from the OLMCP.

Regional CentersThe original purpose of the regional centers was to help organize and

support the development of ALMCs while having a variety of independentfunctions, including research. As the ALMC network has become stable—andlack of additional funds discourages the formation of new committees—and astheir professionalism has increased, the regional centers have declined innumber and diversified their functions.

The Northeast Ohio Center for Labor-Management Cooperation,located in the Cleveland suburb of Independence, is a program of the Work InNortheast Ohio Council. The Center provides consulting services to assistorganizations in enhancing labor-management cooperation and introducinghigh-performance work systems and best practices in manufacturing. TheCenter aided more than 50 organizations in 1998 with more than 65 customizedprojects.

Through 29 public workshops, the Center reached more than 500people in 1998 through a range of courses, the most significant of which wereExploring Labor-Management Cooperation, Team Leader and FacilitatorTraining, and Advanced Facilitator Training. These three-day courses areoffered several times per year with support from the OLMCP. Another 300people took part in local benchmarking opportunities through several no-charge events that included plant tours and productivity forums.

Recent clients of the Northeast Ohio Center include the ClevelandPublic School system and its teachers union; the Ohio Civil Service EmployeesAssociation; the American Federation of State, County and MunicipalEmployees (AFSCME); and the Ohio Department of Transportation. TheCenter has a history of working closely with the Greater Cleveland GrowthAssociation and the Cleveland Advanced Manufacturing Program (CAMP) onworkforce development projects and has recently established a new partner,North Coast Education Services (NCES). Through leveraged funding from theCleveland Foundation and the Growth Association, the Center and NCES willprovide company-wide training in basic and interpersonal skills development tofive northeast Ohio organizations.

During 1998, theDuring 1998, theDuring 1998, theDuring 1998, theDuring 1998, theCenter forCenter forCenter forCenter forCenter forPPPPPerformanceerformanceerformanceerformanceerformanceExExExExExcellence cellence cellence cellence cellence providedprovidedprovidedprovidedprovidedmore than 8,000 hoursmore than 8,000 hoursmore than 8,000 hoursmore than 8,000 hoursmore than 8,000 hoursof free or lowof free or lowof free or lowof free or lowof free or low-----costcostcostcostcostservices to 110 privateservices to 110 privateservices to 110 privateservices to 110 privateservices to 110 privateand and and and and public companies.public companies.public companies.public companies.public companies.

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The Northwest Ohio Center for Labor-Management Cooperation, atthe University of Toledo, has provided assistance to more than 100 companiesand their unions. Of these companies, 47 percent have established joint labor-management employee involvement processes utilizing the training andexpertise provided by the Northwest Center. In addition, the Center coordinatesthe outreach activities of the unique Working Council for EmployeeInvolvement (WCEI), which includes a joint steering committee of topmanagement and union leadership from Chrysler Jeep, Chrysler ToledoMachining, Ford Maumee Stamping, GM Powertrain, Libbey-Owens-Ford,New Mather Metals, Johnson Controls, and Harris Semiconductor. Through theCenter, WCEI has contributed in excess of 5,000 hours of in-plant trainingexpertise to northwest Ohio facilities.

The Center for Performance Excellence (formerly the SouthwestOhio Center for Labor-Management Cooperation), affiliated since 1987 withWright State University in Dayton, provides a range of services, includingconsulting, cultural and needs assessments, and customized training that

40

integrate theory, best practices, experience, and expertise to improveorganizational performance.

The Center’s focus is on the design and implementation of programs incooperative processes, positive work relations, effective leadership, self-directed work teams, interpersonal communication, constructive conflict,workplace violence prevention, diversity, time/stress management, safetyteams, strategic planning, and the creation of high performance workenvironments. During 1998, the Center provided more than 8,000 hours of freeor low-cost services to 110 private and public companies; conducted 42assessments involving in excess of 28,000 employees; and developed 250plant-specific training programs.

In 1997, the Center added the Partnership Resource Institute (PRI) toaddress the region’s changing needs and to support continual professionaldevelopment in the field of labor-management cooperation throughout thestate.

Center FundingOLMCP support for the centers was capped under the Celeste

administration at $150,000 annually, and centers were not required to raisematching funds. Under the Voinovich administration, the funding cap has beengradually pared down to $118,000 for the 2000-2001 biennium and centershave been required to raise matching funds from other sources: during the2000-2001 biennium, they are required to raise at least $1 in match for every$1 in ODOD funding.

Area Labor-Management CommitteesThe Area Labor-Management Committees were established to meet

the needs of geographic areas. Each committee has a board of directors thatincludes both labor and management; most also include local governmentalrepresentatives, giving them a strong local anchor. Although all the committeesare funded on a matching basis by the OLMCP, they have substantial latitudeto develop their programs to meet local needs so long as they make suitableprovision in their annual workplans. Consequently, no two are alike. ODODcommittee grants vary from $20,000 to $60,000, and committees have longbeen required to raise matching funds as they matured, up to $1 in match forevery $1 in ODOD funds for committees that were at least five years old.

The areas of the state formally covered by the area labor-managementcommittees are shown in Figure 2. Note that significant areas of the state arenot covered at all by ALMCs. In northeast Ohio, this includes Cuyahoga,Summit, Geauga, and Lake counties. Ashtabula lost its committee and iscovered with difficulty from Youngstown. In southeast Ohio, the situation isworse than the map suggests because the East Central Ohio Area Council isspread far too thin over nine counties.

The Great Lakes Organized Labor Management Council (formerlyThe Lorain County Organized Labor Management Council) at LorainCommunity College sponsors five workshops/forums each year. More than 75organizations have taken part in these workshops. With an averageattendance of 22 people, the GLOLMC reaches more than 350 people throughits annual workshop schedule. The Council has also delivered a variety of in-plant services, including Built-Rite Construction Management Process, Safety

The EmployeeThe EmployeeThe EmployeeThe EmployeeThe EmployeePPPPParticipationarticipationarticipationarticipationarticipationCouncil of NorthCouncil of NorthCouncil of NorthCouncil of NorthCouncil of NorthCentral Ohio hasCentral Ohio hasCentral Ohio hasCentral Ohio hasCentral Ohio hastrained overtrained overtrained overtrained overtrained over12,000 individuals12,000 individuals12,000 individuals12,000 individuals12,000 individualsin cooperative workin cooperative workin cooperative workin cooperative workin cooperative worksystems and new worksystems and new worksystems and new worksystems and new worksystems and new worksystems, providingsystems, providingsystems, providingsystems, providingsystems, providingmore than 7,500more than 7,500more than 7,500more than 7,500more than 7,500hours of specifichours of specifichours of specifichours of specifichours of specifictraining intraining intraining intraining intraining inthose areas.those areas.those areas.those areas.those areas.

41

Always, Labor Management Committee Development, and Joint StrategicPlanning. The Council was established in 1990.

In addition, the Council has collaborated on several economicdevelopment efforts in Lorain County including Lorain County 2020, the LorainCounty Chamber of Commerce, the Lorain County Education/TrainingConsortium, the Lorain County Workplace Institute, Leadership Lorain County,and Hard Hatted Women in Cleveland.

The Council is assisting area union building and construction tradescouncils and contractor associations in developing a labor managementinitiative called the Union Construction Industry Partnership. The Partnershipwill serve a five-county area consisting of Lorain, Cuyahoga, Lake, Geauga,and Ashtabula counties.

The Mahoning Valley Labor-Management Council (MVLMC) inYoungstown provides specialized labor-management training primarily in athree-county area: Mahoning, Trumbull, and Columbiana. Those assistedinclude both public sector entities such as the City of Youngstown andMahoning County and private sector manufacturers such as WCI, ThomasSteel, LTV, and CSC, as well as healthcare organizations Trumbull MemorialHospital, Hillside Rehab, and Forum Health.

The MVLMC also hosts a series of timely workshops catering to adiverse audience in order to raise labor management awareness and promoteeconomic stability throughout the Mahoning Valley. The workshops cover suchtopics as increasing labor-management understanding, problem- solving,conflict prevention, productivity, workplace safety, facilitator training, teambuilding, and dealing with the media.

The Tuscarawas County Labor Management Council and The StarkCounty Labor Management Council work closely with Stark State College inproviding economic development initiatives for these two industrializedcounties.

In 1998, the councils completed climate assessments for the City ofMassillon with a training program to follow and provided the City of Canton’ssupervisors with diversity training. In addition, they completed a climateassessment for the Tuscarawas County Department of Human Services withtraining to follow and conducted a climate scan for the City of New Philadelphiawith proposed action steps presented.

In programming and outreach, the Councils held a workshop on “TakingInitiative,” presented a case study at the Annual Buckeye Labor ManagementConference, and presented another case study for the annual meeting of theEmployee Participation Council of North Central Ohio.

The Employee Participation Council of North Central Ohio, based inMansfield, has provided training and process development assistance in suchareas as labor-management cooperation, gainsharing, win/win negotiations,Total Quality Management, statistical process control, strategic planning,conflict management, communication skills, supervisor/union official training,problem-solving, ISO-QS 9000, and team process. In the last five years, theCouncil has trained more than 12,000 individuals in cooperative work systemsand new work systems in the State of Ohio, providing more than 7,500 hours ofspecific training in those areas.

The SouthwesternThe SouthwesternThe SouthwesternThe SouthwesternThe SouthwesternOhio WOhio WOhio WOhio WOhio Workingorkingorkingorkingorking

Network worksNetwork worksNetwork worksNetwork worksNetwork workswith approwith approwith approwith approwith approximatelyximatelyximatelyximatelyximately

50 organizations and50 organizations and50 organizations and50 organizations and50 organizations andtrains nearly 1,000trains nearly 1,000trains nearly 1,000trains nearly 1,000trains nearly 1,000

employees each yearemployees each yearemployees each yearemployees each yearemployees each year.....

42

Organizations assisted include Armstrong Air Conditioning, IdealElectric Corporation, Sprint, Armco, Norwalk Furniture, National Lime andStone, Shawnee State University, the Ohio Civil Service EmployeesAssociation, Ohio Department of Transportation, the City of Mansfield, the Cityof Lancaster, and Richland County.

The Council has also worked closely with economic developmentinitiatives within North Central Ohio to preserve more than 2,500 jobs and addmore than $2.5 billion of new investment in the nine-county area it serves.

The Lima Area Labor-Management Citizens Committee providestraining to organizations in Lima, Ohio and neighboring communities inpartnership with the Northwest Ohio Center for Labor ManagementCooperation. Programs include Partnering Associate Cooperative Trainingand Network Employee Employment Team training. Both of these programsinvolve group training in team and employee involvement concepts. Teamshave been trained from Toledo Molding and Die and United Auto WorkersLocal 2279; Rudolph Foods and United Food and Commercial Workers Local911; Family Resources Centers and Teamsters Local 908; and WarehouseAssociates and Teamsters Local 908.

The Committee has also facilitated labor-management meetings and,with support from local companies and labor organizations, releases an annual“Salute to Labor” television spot each Labor Day weekend. The Committee hasbeen well-supported by the City of Lima, the Allen County Commissioners, andarea business and labor organizations. The Committee has been reviewing theorganization’s goals by bringing together representatives of companies,unions, and the community for sessions facilitated by the Northwest Center forLabor-Management Cooperation.

The Ross County Area Labor Management Committee at OhioUniversity’s Chillicothe campus sponsored nine workshops in 1998 with about140 participants representing several thousand members and employees fromarea organizations. In addition, the Committee has formed a partnership withfive area middle schools to promote a program called “Meet the Challenges ofTomorrow.” The program has involved approximately 700 students. Along withthe Mead Corporation and other Ross County businesses, the Ross Countyschools and the Committee have started a project to improve the math andscience skills of students in the area. The project is also directed towardeducational staff development and education and training for employees,parents, and other interested members of the community. Also in the area ofeducation, the Committee’s annual fund-raising efforts resulted in the awardingof three $300 college scholarships to area students.

The Area Labor-Management Council of East Central Ohio providesemployee training and consultation to businesses and organizations inBelmont, Coshocton, Fairfield, Guernsey, Knox, Muskingum, and Noblecounties. More than 2,000 workers receive training from the Council each yearon such topics as team development, problem-solving, safety, productivity andquality improvement, world-class manufacturing, and self-directed work teamsas well as participating in custom-designed training programs.

The Council holds an annual leadership conference that attractsroughly 200 labor and management leaders from throughout the state. The

...the Ohio Labor-...the Ohio Labor-...the Ohio Labor-...the Ohio Labor-...the Ohio Labor-ManagementManagementManagementManagementManagementCooperationCooperationCooperationCooperationCooperationProgram...hasProgram...hasProgram...hasProgram...hasProgram...hasbolstered and isbolstered and isbolstered and isbolstered and isbolstered and iscontinuing tocontinuing tocontinuing tocontinuing tocontinuing tosignificantlysignificantlysignificantlysignificantlysignificantlyinfluence Ohio’sinfluence Ohio’sinfluence Ohio’sinfluence Ohio’sinfluence Ohio’slevel of industriallevel of industriallevel of industriallevel of industriallevel of industrialcompetitiveness.competitiveness.competitiveness.competitiveness.competitiveness.

43

Council has also been an active partner with community economicdevelopment officials and has played a significant part in helping save morethan 800 jobs in the region over the last 10 years.

The Southwestern Ohio Working Network at Wright State Universityin Dayton has been helping to improve the performance of organizations in theMiami Valley and surrounding counties since 1989. The Network works withroughly 50 organizations and trains nearly 1,000 employees each year. Itoffers consulting services and customized training programs in a number oftopic areas, including designing and implementing self-directed work teams,labor-management cooperative processes, performance managementsystems, successfully transforming an organization’s culture, and establishingeffective safety committees.

Other training programs include team building, team leadership,customer service excellence, time management, strategic planning, and seniorleadership development. The Network focuses on assessing an organization’scurrent situation and goals, custom designing an appropriate program orprocess, implementing the program or process, evaluating its implementation,and providing ongoing support services.

The Columbus Area Labor-Management Committee, since 1986,has been providing services to benefit labor management cooperation andeconomic development in central Ohio. During 1998, the Committee has hadoccasion to work with more than 50 businesses and unions and has reachedmore than 10,000 employees.

The Committee’s services include training in developing highperformance work systems, team effectiveness, workplace safety, interest-based problem-solving, collective bargaining, contract interpretation,leadership in a cooperative environment, and many other programs specificallydesigned to meet individual clients’ needs. About 20 different public programsare designed and offered each year educating more than 200 attendeesrepresenting approximately 20 organizations.

The Committee also provides neutral facilitation to teams dealing withworker adjustment and other labor-management concerns and also conductsworkplace assessments. The Committee has completed assessments for atotal of 10 organizations covering some 5,000 employees.

The Labor-Management Resource Network (formerly The GreaterHamilton Labor Management Council) has helped more than 75organizations and unions in the five southwest Ohio counties aroundCincinnati. The Council’s focus has been on creating high-performanceworkplaces through joint labor-management participation.

Specialty areas include organizational change training, labor-management cooperative efforts in the public sector, high-performance in thehealthcare industry, workplace basic skills, and dislocated worker adjustment.The market value of the Council’s services to southwestern Ohio communitiesis in excess of $300,000 per year.

Judging from theJudging from theJudging from theJudging from theJudging from theliterature, the OLMCPliterature, the OLMCPliterature, the OLMCPliterature, the OLMCPliterature, the OLMCP

is clearly on the cuttingis clearly on the cuttingis clearly on the cuttingis clearly on the cuttingis clearly on the cuttingedge in promotingedge in promotingedge in promotingedge in promotingedge in promoting

best practices inbest practices inbest practices inbest practices inbest practices inlabor-managementlabor-managementlabor-managementlabor-managementlabor-management

cooperation.cooperation.cooperation.cooperation.cooperation.

44

Evaluating the OLMCPAs can be readily seen from the preceding record, the Ohio Labor-

Management Cooperation Program, through its network of centers andcommittees, has bolstered and is continuing to significantly influence Ohio’slevel of industrial competitiveness. State grants through the Ohio Departmentof Development are highly supplemented by local funds to provide qualitytraining and consultation to both private and public Ohio companies andorganizations. This coordinated effort has helped to retain jobs and encourageexpansion within the state. This effort is believed to have also paid off in laborconflict avoided, but this is difficult to quantify. No research has been done todate comparing the incidence of labor disputes in Ohio companies participatingin the OLMCP program with those that do not, but this would be an excellentsubject for future research.

There are a number of more specific points that can be made about thedevelopment of the OLMCP over the years may serve as guideposts for thefuture.

1.What is perhaps most striking, the OLMCP clearly is on the cuttingedge (judging from the literature) in promoting best practices in labor-management cooperation. ALMCs and centers between them are doing allthat the research literature recommends. Moreover, as can be seen in Chapter3, Ohio companies with state-of-the-art labor-management cooperationprograms are putting them into practice. As far as we can judge, this is not aresult of the OLMCP staff being voracious readers. Rather, the primarydissemination route for these practices among ALMC and center staffmembers are the quarterly meetings with their training and discussion atconferences including the annual Buckeye Labor-Management Conference,which is run jointly by the OLMCP, SERB, and the FMCS, and the FMCS-funded professional development program. In the future, the PartnershipTraining initiative undertaken by the Wright State Center will contribute as well.Initially the centers were key in spreading these practices to the ALMCs, as wasthe training for staff done by the Department of Labor’s Bureau of LaborManagement Relations and Cooperative Programs. Today, it is much more ofa reciprocal process.

2. The OLMCP accorded a major role to state universities inimplementation of the program. The original concept called for university-based centers to provide support for area committees, and that has proven tobe relatively successful. The area committees most typically have a singleprofessional staff member, and their ability to draw on the regional centers forsupport in their early years was crucial. The university-based centers were ableto draw on far broader faculty expertise.

In time, of course, the ALMCs built their internal professional expertise,forcing a change in role for the centers; some disappeared, generally becauseof low performance and weak leadership, while others specialized.Interestingly enough, a number of the ALMCs are now located on campuses,including all those in northeast Ohio: the Great Lakes ALMC is located atLorain Community College, the Mahoning Valley ALMC is located in the UrbanCenter at Youngstown State University, the Stark County ALMC is located atStark Tech, and the Tuscarawas ALMC is at a Kent State University branchcampus.

OLMCP “bestOLMCP “bestOLMCP “bestOLMCP “bestOLMCP “bestpractices” havepractices” havepractices” havepractices” havepractices” haveattracted federalattracted federalattracted federalattracted federalattracted federalfunding from thefunding from thefunding from thefunding from thefunding from theFederal MediationFederal MediationFederal MediationFederal MediationFederal Mediationand Conciliationand Conciliationand Conciliationand Conciliationand ConciliationServiceServiceServiceServiceService

45

Curiously, while university-based centers continue to innovate andspecialize, they have never developed as significant a research program asmight have been expected. This has robbed them of broader influence thatthey might otherwise have obtained in the academic labor relations community.It is the more regrettable because their constant interactions with companiesand unions offers a wonderful empirical laboratory for applied research.Moreover, none of the university-based centers has developed graduatetraining in the area. This is equally regrettable, and it has reduced the leveragethat the program might have had.

3. The requirements of local bipartite or tripartite boards for ALMCs, ofadvisory boards for the university-based centers, and the pressure to raisematching funds for state dollars has encouraged entrepreneurship and helpedto root the programs locally. It has also been a source of outreach and trainingwork for the ALMCs and created substantial local political support for theirefforts.

4. Local labor-management cooperation programs have evolved indifferent directions in response to local requests and initiatives. This includesdeveloping in-school programs dealing with cooperation and teamwork,school-to-work programs, and workplace health and safety. Because thelabor-management committees are anchored in local business and unions,each committee has taken on its own specific character. Their differentcharacters also reflect differences among the ALMCs’ staff interests and styles.

5. Over time, most of the Centers and some of the ALMCs havedeveloped their own training networks, providing multicompany programs thatappeal particularly to smaller companies that might not otherwise be able toafford training. While the formal programs attract the audience, a great deal oflearning goes on among company participants as they share their experience.These networks encourage a good bit of informal benchmarking and sharing ofbest practices that come in time to influence the training done by the centersand ALMCs.

6. The OLMCP’s requirement of quarterly meetings for ALMC andcenter staff has been far more than an administrative tool. Over time, it hascreated a functioning network that encourages rapid replication of successfulprograms. The quarterly meetings, which bring staff together for a day or two,have been an education for all staff, both through formal training sessions andthrough informal sharing of experiences. The ALMCs have come to draw oneach other as well as the centers for support and innovative programming.

As the OLMCP has matured from its initial hierarchical structure into aworking network, it has placed more stress on local initiative, added more valueto its services, and reduced duplication. That remains a theme for the future.It has become a major resource for the state, and is capable of developing andimplementing new programs in the field of labor-management cooperation.

7. As a final indication of program success, OLMCP “best practices”have attracted federal funding from the Federal Mediation and ConciliationService, which commissioned a group of centers and ALMCs to put some oftheir most successful programs into a “train-the-trainer” format. Between 1996

One of the kOne of the kOne of the kOne of the kOne of the keys to theeys to theeys to theeys to theeys to thelongevity of the OLMCPlongevity of the OLMCPlongevity of the OLMCPlongevity of the OLMCPlongevity of the OLMCP

has been thehas been thehas been thehas been thehas been theprogramprogramprogramprogramprogram’s ability to’s ability to’s ability to’s ability to’s ability to

meet changing needs.meet changing needs.meet changing needs.meet changing needs.meet changing needs.

46

and 1998, eight two- or three-day programs were packaged in this fashion andpiloted for OLMCP staff, the staff of the State Employment Relations Board(SERB), and center and ALMC advisory board members. The plan is thateventually part or all of this material will be incorporated into FMCS’s preventivemediation program.

In her evaluation of the program, Karen M. Conrad, Manager of the OhioLabor-Management Cooperation Program since 1992, stresses the adaptivedevelopment of the program to meet local needs. In Conrad’s words:

The program was originally established in a period ofcrisis. Ohio was perceived to be a difficult place to maintain abusiness because of the lack of cooperation between labor andmanagement. The term ‘Rust Belt’ was used for severalmidwestern industrial states that were experiencing many of theproblems of an aging manufacturing industrial base. TheOLMCP has successfully helped to raise the consciousness oflocal groups that are interested in cooperative workplaces.These groups have been able to work on the common problemsof their service areas while maintaining a neutral environmentwhere both labor and management can work together.

In addition, and I emphasize the importance of thissecond accomplishment, the OLMCP has exhibited the ability tomeet changing needs. The kinds of services offered throughthe Program have evolved to keep pace with the times and theincreasingly global nature of competition. Ohio is now very wellregarded as a good place to do business. The Ohio Labor-Management Cooperation Program, we believe, has played animportant role in changing attitudes about Ohio.

In the early 1980s, Ohio was held to be one of the least attractive statesin the union for business location. By the 1990s, however, Ohio regularly wasat the top of the list of states, and has actually been the number one state forbusiness location during the 1990s according to Site Selection Magazine,leading runner-up Texas by a substantial margin. This is a clear indication thatOhio has done a lot of the right things.

Perhaps the best testimony to the success of the OLMCP can be foundin Conrad’s comments: While regarding the program as an influential part ofeffecting the change that has developed in Ohio, Conrad believes that theprogram must continue to evolve and not rest on any laurels it may have earnedin the past: “Some of the passion that accompanied the establishment of thecommittees seems to have waned in some areas. There needs to be deepersupport for the process at the local level; a recommitment, if you will. A lot ofprograms in other states that were being written about in the early 1990s don’texist anymore. The Ohio Labor-Management Cooperation Program hasmanaged to stick around because it has evolved. It needs to keep doing that.”

“There may also have to be some rethinking about the role of theRegional Centers in the overall scheme of things,” Conrad says. “The ALMCsare ‘growing up’ and can handle a much wider range of responsibilities thanthey could earlier on. Regional Centers remain an integral and important part

A 1991 Harvard Univer-A 1991 Harvard Univer-A 1991 Harvard Univer-A 1991 Harvard Univer-A 1991 Harvard Univer-sity study found Ohio’ssity study found Ohio’ssity study found Ohio’ssity study found Ohio’ssity study found Ohio’spublic sector labor-public sector labor-public sector labor-public sector labor-public sector labor-managementmanagementmanagementmanagementmanagementcooperationcooperationcooperationcooperationcooperationinfrastructure to beinfrastructure to beinfrastructure to beinfrastructure to beinfrastructure to bethe most ethe most ethe most ethe most ethe most extensive inxtensive inxtensive inxtensive inxtensive inthe United States.the United States.the United States.the United States.the United States.

47

of the Program, but perhaps they should try to capitalize more on theirindividual areas of expertise.

“The OLMCP is not a cookie-cutter type of program,” concludesConrad. “We have tried to remove non-productive aspects of the program andto continue to develop more and more examples of local partnership. This is areal plus and it is at this level where the job really gets done” (Conrad 1998).

Where do we go from here? What needs to be done as we enter the21st century to insure that Ohio enhances its world-class position? The nextsection will try to provide some answers to these questions and to the overridingissue of sustainability.

Ohio Labor-Ohio Labor-Ohio Labor-Ohio Labor-Ohio Labor-ManagementManagementManagementManagementManagementCooperationCooperationCooperationCooperationCooperation

Program committeesProgram committeesProgram committeesProgram committeesProgram committeesand centers haveand centers haveand centers haveand centers haveand centers have

proven to beproven to beproven to beproven to beproven to beremarkremarkremarkremarkremarkably fleably fleably fleably fleably flexiblexiblexiblexiblexible

in responding to localin responding to localin responding to localin responding to localin responding to localinitiatives.initiatives.initiatives.initiatives.initiatives.

48

5. Envisioning Labor-Management Cooperation in theWorld Class Region

Since its origins in Governor Celeste’s “Labor/Management/Productivity Kitchen Cabinet” in 1983, the Ohio Labor-ManagementCooperation Program has proven to be a notable success. It was well-craftedto interlock the resources of major state universities and public service needsof area committees. The bipartite (or often tripartite) structure of the areacommittees has created an institutional framework within which to meet locallyto talk about issues of common concern— such as occupational health andsafety avoiding sexual harassment and workplace violence—as well as issuesaround employee involvement and participation. It has provided a neutralforum for both labor and management and created a cadre of localprofessionals in labor management cooperation who are rooted in thecommunity– not folks who parachuted in to “fix” one side or the other and thenleft. And it has had a demonstrable impact on building a more cooperativeclimate and cooperative institutions between labor and management.

The OLMCP has built a substantial constituency in those regions wherethe program has a presence. Decentralization and local initiatives have workedand worked well. It is hard to imagine that a centralized program with a researchorientation sited at The Ohio State University in Columbus—the originalconcept—could ever have achieved the success that the decentralizedOLMCP has had.

Moreover, the Ohio Labor-Management Cooperation Programpositioned Ohio firms at the forefront of the “high performance” wave of the1990s. “High performance work organizations,” according to the United StatesDepartment of Labor (1993, p. 1), “provide workers with the information, skills,incentives, and responsibility to make decisions essential for innovation, qualityimprovement, and rapid response to change” (1993, p. 1). Since the Ohioprogram originated, it has promoted precisely those employee participationsystems and skills – open business communication and financial incentivesincluding profit sharing, gain sharing, and employee ownership – that theDepartment of Labor says are correlated with improved company productivity,quality, performance, and profitability.11 The OLMCP program has provided theoutreach and the training necessary to utilize all of these throughout Ohio. Ithas done so while stressing the legitimate role of organized labor in shapinghigh performance practices in Ohio firms through joint labor-managementcooperation. It is a classic “high road” economic development program thatimproves company productivity and profitability while also improving employeeskills, knowledge, and financial security. It has won support from Democraticand Republican administrations alike.

This section explores how to take this program up a notch. Specifically,How to establish and sustain world class labor-management cooperation in ourregion?

Building on SuccessIn order to envision labor-management cooperation in a “world class

region” in, say, 2025, the best point of departure is Ohio’s existing public sectorlabor-management cooperation infrastructure. In 1991, a Harvard Universitystudy found it to be “the most extensive in the United States” (Howitt, Wells, andMarx 1991, 3-1). It still is.

The challenge todayThe challenge todayThe challenge todayThe challenge todayThe challenge todayis to move fromis to move fromis to move fromis to move fromis to move fromcooperation tocooperation tocooperation tocooperation tocooperation topartnership.partnership.partnership.partnership.partnership.

49

The Ohio Labor-Management Cooperation Program has a well-established presence throughout much of the state, which is rooted inadaptation to local conditions. While its emphasis continues to fall primarily onnurturing joint labor-management participation programs at the plant level bysupporting and providing training for joint labor-management committees,OLMCP committees and centers have proven to be remarkably flexible inresponding to local initiatives, both in requests from companies and inprograms from local schools, office holders, and economic developmentpersonnel.

While the relations between the area committees and the regionalcenters have not always been without friction, generally speaking, the structurein which regional centers provide support for area committees has worked well.The amount of support needed has declined as ALMC staff members havebecome more experienced, and the centers have gradually been reorientedfrom each playing the same role in different regions to greater specialization.The statewide specialty centers —the Workplace Relations Institute at LorainCounty Community College and the Ohio Employee Ownership Center at KentState—largely provide their services directly to workplace joint labor-management committees in the public and private sectors and to buyoutgroups, retiring owners, and employee-owned companies.

While this overall structure has worked well, this evaluation suggests sixrecommendations for improving it:

1.) Expand geographic coverage There are clearly underserved areas in thestate (see Figure 2). Southeast Ohio is certainly a case in point. In NortheastOhio, area committees were never established in Akron or Cleveland12,although they clearly should be, and the Ashtabula area LMC closed shopwhen its staff person went back to school. Geauga, Lake, and PortageCounties have no committees either. The region would be better served witharea labor-management committees established in these locations.

2.) Develop a stronger presence in the academic discussion. Theuniversity link that the centers provide has been underutilized. The centersand ALMCs have unparalleled research access that can be used to improvetheir own practice and to establish national preeminence in this field. Thataccess also offers the possibility of developing a state-of-the-art trainingprogram that would mix union leaders and managers with conventionalstudents, presumably at the master’s level; given the internship possibilities, itis hard to believe that such a program would not place 100 percent of itsgraduates. Such a program ought to be inter-institutional and interdisciplinary.

3.) Generalize company networks. The success of the company networksestablished by the Southwest Ohio Working Network, headquartered at WrightState, and the Ohio Employee Ownership Center at Kent State is worthexamining from the point of view of replication. These networks provideinexpensive training, generally for firms that are too small to have in-housetraining capacity and are unlikely to undertake the costs of hiring outsidetraining consultants. Such company networks quickly become self-supportingif the programming is of good quality. Committees seeking to establishcompany networks can draw on other ALMCs and centers for initialprogramming.

The region needs aThe region needs aThe region needs aThe region needs aThe region needs arenewed social com-renewed social com-renewed social com-renewed social com-renewed social com-pact between laborpact between laborpact between laborpact between laborpact between labor

and managementand managementand managementand managementand managementcomparable to thatcomparable to thatcomparable to thatcomparable to thatcomparable to that

forged duringforged duringforged duringforged duringforged duringWWWWWorld World World World World War II.ar II.ar II.ar II.ar II.

50

4.) Develop industry-wide or sector committees that cut acrossgeographic boundaries. The effort to develop an industry-wide committee inthe building trades in five counties in Northeast Ohio should be only the first ofa number of industry-specific committees. Initially the OLMCP’s geographicfixation and modest turf wars precluded such functional division ofresponsibility, but as the program has matured, turf conflicts have abated. Onecan imagine the development of regional industrial labor-managementcommittees in a number of industries besides the building trades such astrucking and the healthcare sector. Such committees should be initially fundedwith public sector money with the goal of moving to a public sector-industrymatch on the same schedule as ALMCs currently do.

5.) Develop functional committees that deal with specific issues, cuttingacross industry and geography. A fifth area of innovation that ought toinspire emulation is the safety training network being undertaken by the GreatLakes Organized Labor-Management Council. The development ofspecialization in various fields of joint labor-management endeavors is worthyof consideration. The most obvious of these is the reinstitution of companyapprenticeship programs, cut too frequently as “cost savings” in the last tworecessions. These are of joint interest to labor and management and importantto the long-term health of the regional economy. We are already experiencinglabor shortages in a number of the skilled trades.

6.) Better coordination with other agencies doing similar work in Ohio.Finally, the OLMCP should mesh better both with other state economicdevelopment programs and the other two organizations doing labor-management cooperative work in the state, the Federal Mediation andConciliation Service (FMCS) and the State Employment Relations Board(SERB). Other economic development programs have tended to ignore theexistence and contributions of the local OLMCP programs in encouragingemployee participation and improving firm performance. It makes sense tocontinue expanding at the local level the cooperation with FMCS and SERB,which was begun around the Buckeye Labor-Management Conference.

Initiatives in these six areas can be considered organic outgrowths ofthe existing labor-management cooperation program. But the world-classregion concept calls for going beyond that.

From Cooperation to PartnershipWhen we envision world class labor-management cooperation in our

region in 2025, we need to look beyond merely building logically on existingfoundations. We need to go beyond the in-plant and in-company cooperativeprograms supported by the OLMCP structure of ALMCs and Centers. We needto challenge ourselves again, to look beyond the current environment asGovernor Celeste challenged the 1984 labor-management conference thatkicked off the OLMCP program. Celeste asked conference participants to“come to an understanding of how to work within that adversarial environmentto achieve an essential dimension of cooperation which serves the mutualinterests of labor and management” (Celeste, 1984). The challenge today is tomove from cooperation to partnership.

If we are to competeIf we are to competeIf we are to competeIf we are to competeIf we are to competesuccessfully in thesuccessfully in thesuccessfully in thesuccessfully in thesuccessfully in theglobal economyglobal economyglobal economyglobal economyglobal economy,,,,,we need to anchorwe need to anchorwe need to anchorwe need to anchorwe need to anchorcapital and jobscapital and jobscapital and jobscapital and jobscapital and jobsregionallyregionallyregionallyregionallyregionally.....

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An increasingly globalized economy, in which trade in goods canswamp national producers and speculative currency flows can swamp entirenational economies, demands rethinking the labor-management relationshipsof the last several decades. It is no longer possible to enjoy the luxury offighting about unionization, “permanent replacements,” and those otherunfortunate internecine struggles of the 1980s. We are now subject to theheartless competition of the global marketplace. What we need is a renewedsocial compact between labor and management in the region comparable tothat forged during World War II.

The decline in labor organization in the private sector, from 16.8 percentof the workforce organized in 1983 to 9.5 percent in 1998, has been one of themajor causes of the decline in real wages for 90 percent of Americans and inhousehold income for the bottom 80 percent of American families. It has alsocontributed to the fact that the polarization of wealth today is more extreme thanin 1929, the previous peak in inequality in the country. The Federal Reserve’slatest data on wealth distribution indicates that the net financial assets of thetop one percent of American households in income is 2.8 times the wealth ofthe bottom 90 percent of families (Mishel, Bernstein, and Schmitt, 1999, 258).The financial wealth of the top two wealth holders in the country —WarrenBuffett and Bill Gates — exceeds that of the bottom 45 percent millionAmericans.

Let us for the moment envision a regional labor-managementpartnership that combines the best practices nationally and internationally withthe existing Ohio labor-management cooperation structure within a renewedsocial partnership. Its goal is simple: strengthening the regional economic basethrough anchoring capital locally, improving firm performance through highperformance workplace practices, upskilling the workforce, and ensuring abetter distribution of healthcare and other benefits to raise the level of sharedprosperity and ownership of productive assets.

This regional partnership would have the following components:

* Mutual recognition by labor and management of the essential functionsthat each performs in a world class regional economy. Freedom to organizeand bargain collectively has been the law of the land in the private sector sincethe National Labor Relations Act of 1935 and in the public sector in Ohio sincethe Public Employee Collective Bargaining Act of 1983. It’s time to accept thisand act accordingly.

* A joint commitment by both management and labor to “high road”economic competitiveness that uses high performance workplace practices(including employee participation, more flexible work and pay systems, profitand gain sharing, etc.) rather than the low road of reducing wages, benefits,and safety and environmental standards to match those in emerging industrialcountries.

* A commitment by both labor and management to life-long learning,including general contractual educational benefits and rights to educationalleave, regional and local involvement of labor as well as management inschool-to-work and workforce training initiatives, and reintroduction ofapprenticeship programs in the skilled trades where labor shortages promise to

...joint labor-...joint labor-...joint labor-...joint labor-...joint labor-managementmanagementmanagementmanagementmanagement

sector initiatives cansector initiatives cansector initiatives cansector initiatives cansector initiatives canhave a significanthave a significanthave a significanthave a significanthave a significant

impact on upgradingimpact on upgradingimpact on upgradingimpact on upgradingimpact on upgradingsectors with a largesectors with a largesectors with a largesectors with a largesectors with a large

number of smallnumber of smallnumber of smallnumber of smallnumber of smallproducers, improvingproducers, improvingproducers, improvingproducers, improvingproducers, improving

technology andtechnology andtechnology andtechnology andtechnology andmanagement skills,management skills,management skills,management skills,management skills,

upgrading workupgrading workupgrading workupgrading workupgrading workskills and workskills and workskills and workskills and workskills and workererererer

education, andeducation, andeducation, andeducation, andeducation, andpushing up laborpushing up laborpushing up laborpushing up laborpushing up labor

standards generallystandards generallystandards generallystandards generallystandards generally.....

52

choke off economic growth in some sectors in the next decade. Labor andmanagement have equal interest in continual workforce training. If there is onething clear from the German model of co-determination, it is that labor-management co-determination of training and apprenticeship programs is inthe mutual interest of both parties and contributes substantially to long termlabor market flexibility.

* A general partnership between universities, government, labor, andmanagement to commercialize and anchor new technologies as new industriesin the region. Structurally this would probably involve the Edison technologyprograms, development of university-based high tech incubators, andintroduction of labor liaisons throughout this sector comparable to the laborliaison initiative undertaken by the Cleveland Advanced ManufacturingProgram (CAMP).

* Involvement of labor and management in regional land use, industrialredevelopment, and transportation policy.

* Regular convening of a regional labor-management summit to considernew initiatives, like those in training and research and development and to buildconfidence in partnership efforts.

While such partnership initiatives are of substantial value regionally,they will be more successful if combined with a joint regional capital strategy. Ifwe are to compete successfully in the global economy, we need to anchorcapital and jobs regionally. To that end, we need regional venture capital fundsthat are patient investors and will do for Ohio’s economic foundation industrieswhat conventional venture capital has done for biotechnology and SiliconValley. This requires a willingness to accept a lower rate of return oninvestment in return for a higher social return in secure jobs, good benefits, andmaintaining community. American pension funds are currently estimated tohold about $7 trillion, much of which has been invested to maximize financialreturns for future pensioners, even at the cost of those future pensioners’economic well being today. The triumph of financial net-present value thinkingover other economic and community values has led some pension funds tobecome part of the problem, rather than part of the solution. Strikingly, a fairportion of those funds are in collectively bargained pension plans that aregenerally co-determined by labor when they are multi-employer funds in theprivate sector, or public employee pension funds.

The building trades have blazed the trail with the national HousingInvestment Trust (1964) and the more recent Building Investment Trust (1988),which invest multi-employer pension fund dollars in unionized constructionprojects. Our regional equivalent is the ERECT Fund, which invests localbuilding trades funds in unionized construction projects in WesternPennsylvania and Northeast Ohio. To date, the ERECT Fund has placed about$100 million. Several individual multi-employer funds, such as the OhioCarpenters pension fund, also make direct investments; the Ohio Carpentershave invested about $100 million themselves in unionized constructionprojects.

For this regionFor this regionFor this regionFor this regionFor this regionto competeto competeto competeto competeto competesuccessfully in thesuccessfully in thesuccessfully in thesuccessfully in thesuccessfully in theglobal economy ofglobal economy ofglobal economy ofglobal economy ofglobal economy ofthe 21st centurythe 21st centurythe 21st centurythe 21st centurythe 21st century, we, we, we, we, weneed to broaden theneed to broaden theneed to broaden theneed to broaden theneed to broaden thevision of labor-vision of labor-vision of labor-vision of labor-vision of labor-managementmanagementmanagementmanagementmanagementpartnership.partnership.partnership.partnership.partnership.

53

In Canada, some 20 labor-sponsored investment funds have been setup on a provincial level since Quebec paved the way in 1983. Those fundsprovide venture capital, subordinated debt, and long-term debt, primarily forsmall and medium-sized business expansion in their respective provinces.Perhaps the best example in English-speaking Canada is Manitoba’s CrocusFund, which has raised $165 million in seven years from 28,000 workingManitobans in IRA-type savings for reinvestment in the province. It is becominga real engine of provincial economic growth, while its positive social screens forinvestment (such as good occupational health and safety) and consistentpartnership with employees (half its investments will result in employeeownership) promise to raise employment standards and broaden capitalownership. By way of comparison, Manitoba’s population is less than that ofGreater Cleveland.

In the last few years, these capital strategies have become a subject fordiscussion in both union and management circles. The AFL-CIO has set up aCenter for Working Capital, the Steelworkers, Mineworkers, and InternationalUnion of Electronic, Electrical, Salaried, Machine, and Furniture Workers (IUE)are bankrolling the Industrial Heartland Fund in the Pittsburgh region, the FordFoundation has funded the Industrial Heartland Investment Forum, and theUnion Labor Life Insurance Company is establishing an industrial venture fund.In addition, the Greater Cleveland Growth Association “Access to Capital”initiative seeks to deal with the recognized inefficiencies in the existing marketmechanisms in supplying adequate capital to small and mid-sized businesses(Greater Cleveland Growth Association n.d. [1998]).

Joint labor-management sectoral programs to improve the status of theindustry, including that of employers and employees, are also worth carefulconsideration. An excellent model is the Garment Industry DevelopmentCouncil in New York City, which is an employer association-Union ofNeedletrades, Industrial, and Textile Employees (UNITE)-governmentpartnership to modernize technology in the industry (particularly in smalleroperations), train workers (in English as well as apparel skills) and managers(in computers), and promote exports. It also runs an employment service forgraduates of its technical classes. Such joint labor-management sectorinitiatives can have a significant impact on upgrading sectors with a largenumber of small producers, improving technology and management skills,upgrading work skills and worker education, and pushing up labor standardsgenerally.

In our region, the Masonry Institute, which jointly promotes unioncraftsmen and contractors, constitutes a partial model.

In the new global economy, where the global flows of currencyspeculation can convert the “Asian tigers” into economic basket casesovernight, regional economic development and growth are simply too importantto be left to the tender mercy of international banks and Wall Street speculation.We need to explore new forms of regional labor-management partnerships tobroaden and deepen labor-management cooperation in plants and to anchorcapital and jobs, upskill the workforce, promote research and development,and develop sectoral cooperative programs.

...joint labor-...joint labor-...joint labor-...joint labor-...joint labor-management sectormanagement sectormanagement sectormanagement sectormanagement sector

initiatives can have ainitiatives can have ainitiatives can have ainitiatives can have ainitiatives can have asignificant impact onsignificant impact onsignificant impact onsignificant impact onsignificant impact on

upgrading sectorsupgrading sectorsupgrading sectorsupgrading sectorsupgrading sectorswith a large numberwith a large numberwith a large numberwith a large numberwith a large numberof small producers...of small producers...of small producers...of small producers...of small producers...

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Looking BackwardIn his utopian novel, Looking Backward (1890), Edward Bellamy

savaged the economic and social order of his day from the vantage point of thedistant future. Today, much of Bellamy’s futuristic thinking is not utopian butreality. Before writing off the vision of world-class labor-managementcooperation in our region as utopian, consider how far we have come in the lasttwo decades.

In the 1970s, most forms of employee involvement and participationwere initiated soley by management — quality circles, employee involvement(EI) teams, and the like. These programs sought to mobilize workers’enthusiasm to participate in order to cut costs, cut jobs, and enrich absenteeowners. Unions were justifiably suspicious. Such management-initiatedprograms were regularly denounced by union activists who snapped up MikeParker and Jane Slaughter’s critiques (Parker 1985, Parker and Slaughter1988, and Parker and Slaughter 1994). International union leaderscounterposed union-designed programs like the Autoworkers “quality ofworklife” initiatives and the Machinists’ “Technology Bill of Rights.”

In the 1980s, there was a genuine movement toward joint labor-management cooperation programs like the GM-UAW Saturn project and theSteelworkers and major steel companies’ Labor Management ParticipationTeam program. State and federal initiatives, such as the Ohio Labor-Management Cooperation Program and the U.S. Department of Labor’sBureau of Labor-Management Relations and Cooperative Programs, bothmirrored and promoted this jointness, or labor-management co-determinationof employee participation programs. This change was reflected in a new roundof publications on jointly designed labor-management cooperation programsfrom labor’s perspective, such as Bob Baugh’s Changing Work: A Union Guideto Workplace Change (1994). While adversarialism remains a hardy perennial,there has been a sea change toward cooperative practices, even when it ishonored in the omission.

For this region to compete successfully in the global economy of the21st century, we need to broaden the vision of labor-management partner-ship. That partnership must take the new beginnings we see all around us infactories and offices and extend them to more places of work. We also needto take labor and management’s cooperative practices out of the workplaceand into the broader society as a regional labor-management partnership insuch varied fields of mutual concern as workforce training and economic de-velopment. These are all integral parts of developing a world-class region.

Before writing off theBefore writing off theBefore writing off theBefore writing off theBefore writing off thevision of world-vision of world-vision of world-vision of world-vision of world-classclassclassclassclasslabor-managementlabor-managementlabor-managementlabor-managementlabor-managementcooperation in ourcooperation in ourcooperation in ourcooperation in ourcooperation in ourregion as utopian,region as utopian,region as utopian,region as utopian,region as utopian,consider how far weconsider how far weconsider how far weconsider how far weconsider how far wehave come in the lasthave come in the lasthave come in the lasthave come in the lasthave come in the lasttwo decades.two decades.two decades.two decades.two decades.

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References

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Batt, William and Edgar Weinberg. 1978. “Labor-Management CooperationToday.” Harvard Business Review. 56 (January/February): 96-104.

Baugh, Robert. 1994. Changing Work: A Union Guide to Workplace Change.Washington: AFL-CIO Human Resource Development Institute.

Bluestone, Barry and Irving Bluestone. 1992. Negotiating the Future: TheLabor Perspective in American Business. New York: Basic Books.

Hanauer, Amy and Mark Cassell. 1999. The State of Working Ohio, Cleveland:Maxine Goodman Levin College of Urban Affairs and Northeast Ohio

Research Consortium.

Celeste, Richard F. 1984. Keynote address to the Governor’s Conference onLabor Management Cooperation, May 10, 1984, as quoted in Howitt,Wells, and Marx 1991, p. 3-5.

Cohen-Rosenthal, Edward. 1995. Unions, Management, and Quality:Opportunities for Innovation and Excellence. Chicago: Irwin.

Conrad, Karen M. 1997. “Ohio Labor-Management Cooperation Program.”Forward Thinking (Spring).

Conrad, Karen M. 1998. Interview by Steve Clem with Karen Conrad,Manager, Ohio Labor-Management Cooperation Program, onDecember 21, 1998.

Cooke, William N. 1990. Labor-Management Cooperation. Kalamazoo, MI:W.E. Upjohn Institute for Employment Research.

Dinnocenzo, Debra A. 1989. “Labor/Management Cooperation.” Training andDevelopment Journal. 43 (May): 35-40.

Gray, Lois. Labor-Management Cooperation. 1983 The Arbitration Journal. 38(June): 17.

Greater Cleveland Growth Association. n.d. [1998] Access to Capital.Strategic Recommendations: Framework for an Access to CapitalSystem in Northeast Ohio. Cleveland: Growth Association.

Hansen, Daniel. 1997 “Worker Performance and Group Incentives: A CaseStudy.” Industrial and Labor Relations Review 51 (October): 37-49.

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Heckscher, Charles. 1988. The New Unionism: Employee Involvement in theChanging Corporation. New York: Basic Books.

Howitt, Arnold M., John Calhoun Wells, and Stacey S. Marx. 1991. “PromotingLabor-Management Cooperation: A National Perspective on StatePrograms.” Unpublished manuscript, Harvard University, preparedunder U.S. Department of Labor grant #E-9-P-8-0096.

Kelly, Maryellen R., and Bennett Harrison. 1992. “Unions, Technology, andLabor-Management Cooperation,” in Lawrence Mishel and Paula Voos,editors, Unions and Economic Competitiveness. Armonk, NY: M.E.Sharpe, pp. 247-85.

Kochan, Thomas; Katz, Harry and Robert McKersie. 1986. The Transformationof American Industrial Relations. New York: Basic Books.

Kochan, Thomas and Paul Osterman. 1994. The Mutual Gains Enterprise:Forging a Winning Partnership among Labor, Management, andGovernment. Boston: Harvard Business School Press.

Logue, John, Richard Glass, Wendy Patton, Alex Teodosio, and KarenThomas, 1998. Participatory Employee Ownership: How It Works.Pittsburgh: Worker Ownership Institute.

Mann, Seymour. 1989. “Labor-Management Cooperation and WorkerParticipation: A Public Sector Perspective.” Public Productivity Review.12 (Spring): 229-236.

McClenahen, John S. 1998. “Manufacturing’s Global Dimensions,”IndustryWeek, April 6: 40-42.

Meyer, Robert. 1998. Interview by Steve Clem with Robert Meyer, Work inNortheast Ohio Council (WINOC), on October 26, 1998.

Mishel, Lawrence; Bernstein, Jared and John Schmitt. 1999. The State ofWorking America 1998-99. Ithaca, New York: Cornell University Press.

Ohio Department of Development, Office of Labor-Management Cooperation.1996. “Leveraging State Support to Enhance Cooperation, A Reviewof the Northeast Ohio Labor-Management Program.” Typescript.

Ohio Department of Development, Labor Management Cooperation Program.1998. “Executive Summary, November 1998” Typescript.

Parker, Mike. 1985. Inside the Circle: A Union Guide to QWL. Boston: SouthEnd Press.

Parker, Mike and Jane Slaughter. 1988. Choosing Sides: Unions and theTeam Concept. Boston: South End Press.

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Parker, Mike and Jane Slaughter. 1994. Working Smart: A Union Guide toParticipation Programs and Reengineering. Detroit: Labor Notes.

Schwochau, Susan; Delany, John; Jarley, Paul, and Jack Fiorito. 1997.“Employee Participation and Assessments of Support for Organiza-tional Policy Changes.” Journal of Labor Research. 18 (Summer): 379-401.

Siegel, Irving and Edgar Weinberg. 1982. Labor Management Cooperation.Kalamazoo, MI: W.E. Upjohn Institute for Employment Research.

Stepp, John R. 1988. “Labor-Management Cooperation: A Framework forEconomic Development.” Economic Development Review. (Winter):36-39.

U.S. Department of Labor: Bureau of Labor-Management Relations andCooperative Programs. 1984. Labor-Management Cooperation:Perspectives from the Labor Movement.

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Notes

1 Percent of Ohio respondents who are union members or covered by a collective bargainingagreement according to the Current Population Survey, 1997.

2 Stepp (1988) argues that LMC is important for regional economic development, but offers noempirical support for his view.

3 This phrase is based on one used by Mann (1989). For another definition see Dinnocenzo(1989).

4 Cooperative committees dealing with issues of health, safety, or drug abuse, for example, areexcluded from this list, but clearly could be included in a more broad definition of LMC.

5 All of these studies are summarized in U.S. Departments of Commerce and Labor, Commissionon the Future of Worker-Management Relations (1995, September-October). “Employee Participation inLabor-Management Cooperation in American Workplaces,” Challenge, 38-46.

6 In the Electromation case in which a decision was reached by the NLRB in 1992, it was foundthat if a committee was originated by the employer or depended on the employer for its continuingexistence, it was regarded as being dominated by the employer and therefore illegal. In more recentdecisions, such as Stoody Company, the Board qualified its view and sought interpretations that wouldnot, as a matter of blanket policy, discourage the formation of labor-management committees.

7 Focus groups composed of members of the Board of Directors, Mahoning Valley Labor/Management Council (May 8, 1998), and the Steering Committee of the Lorain County Organized Labor/Management Council (May 28, 1998).

8 For an excellent account of the origins, early history, and initial impact of the OLMCP, see Howitt,Wells, and Marx 1991, chapter 3.

9 OLMCP staff at the Department of Development peaked at five, including support staff, as theprogram was being geared up. Columbus staff reductions began during the waning days of the Celesteadministration and continued under the Voinovich administration. As of this writing, OLMCP managerKaren Conrad is the only Department of Development staff person; she administers the OLMCP on a half-time basis.

10 This section is based on two Ohio Department of Development reports: Ohio Department ofDevelopment 1996 and Ohio Department of Development 1998.

11This useful Department of Labor publication marshals the evidence from the empirical scholarlyresearch relating participation, work organization, financial incentives, work systems, and training tocompany productivity, performance, and profitability. Its findings are unequivocal that “high performance”practices mobilize employee knowledge and skills to improve company performance. Moreover, thesepractices are mutually reinforcing and, when several are implemented as a system, have a synergisticimpact.

12 WINOC serves some of the functions of an ALMC in Cleveland.

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13 For an excellent account of the origins, early history, and initial impact of the OLMCP, see Howitt,Wells, and Marx 1991, chapter 3.

14 OLMCP staff at the Department of Development peaked at five, including support staff, as theprogram was being geared up. Columbus staff reductions began during the waning days of the Celesteadministration and continued under the Voinovich administration. As of this writing, OLMCP managerKaren Conrad is the only Department of Development staff person; she administers the OLMCP on a half-time basis.

15 This section is based on two Ohio Department of Development reports: Ohio Department ofDevelopment 1996 and Ohio Department of Development 1998.

16This useful Department of Labor publication marshals the evidence from the empirical scholarlyresearch relating participation, work organization, financial incentives, work systems, and training tocompany productivity, performance, and profitability. Its findings are unequivocal that “high performance”practices mobilize employee knowledge and skills to improve company performance. Moreover, thesepractices are mutually reinforcing and, when several are implemented as a system, have a synergisticimpact.

17 WINOC serves some of the functions of an ALMC in Cleveland.