Author: Howard Levitt
Publication: National Post
This is not an equal opportunity recession. While wreaking havoc in every sector, this meltdown has ravaged unionized employers with particular ferocity. That’s not a coincidence, but rather the inevitable consequence of unionization.
Nearly every clause in a Canadian collective agreement renders employers, in greater or lesser measure, uncompetitive. The protection of mediocre, senior employees over higher-skilled, more junior ones; rigid classifications limiting who can be assigned tasks; an inability to promote the best employees; and the dissipation of employee motivation by provisions that eliminate rewards for performance all add expense and inefficiency, jeopardizing companies’ prospects of emerging from this recession intact.
As I noted last week, if left to their own devices, GM autoworkers might have accepted the significant wage reductions required to keep GM operating. The Canadian Auto Workers Union, however, has the power to effectively frustrate employee wishes. Union representatives often make unrealistic promises to garner the support they need, but by the time its members realize they were misled, the opportunity to vote has passed. They may even be out of work by then.
Companies generally get the unions and collective agreements they deserve. If an employer proactively provides competitive wages and benefits, it likely will not be unionized. In a future column, I will discuss the workplace audit employers should undertake to remain union-free.
Once unionized, companies need not acquiesce to collective agreements limiting their flexibility. Labour legislation cannot be blamed for many of the damaging clauses to which management agrees. If an employer is resolute, it can negotiate collective agreements providing even greater rights than it has in the absence of a union. For example, many agreements I negotiate provide no weight to seniority.
Few agreements provide such rights because management is often too timorous to negotiate amendments to the limitations imposed by their agreements. They need not fear doing so. Few employees will strike over non-monetary issues, especially this year. Now is the time to rewrite your collective agreements and make them competitive. That is what I am instructing clients to do.
Similarly, employees can rid themselves of unions. In the last two or three months of a collective agreement (it varies by province), they can circulate a petition to decertify. If the requisite signatures, 40% to 50% of employees, (depending on the province) sign the petition, the labour relations board will conduct a secret ballot vote to decide whether the union will continue. However, management cannot be involved in this process. With unions crippled by the loss of dues in the face of layoffs, now is the time for employees to part from their unions. In some cases, it might even save their jobs.