Viewpoint -- How Corporate America Can Protect Itself From The Rupture In The AFL-CIO

During the 1930s, 1940s and 1950s, more than one third of all workers were union members. Today, union membership has dropped to less than 10% of the workforce. What happened? The union movement was the driving factor behind important legislation that protected workers' rights, and created new rights. With the passage of anti-discrimination laws such as Title VII of the Civil Rights Act of 1964 and the Americans With Disabilities Act, and with the creation of OSHA, many workers have come to feel that unions have become superfluous.

Furthermore, as many U.S. companies found themselves in sink-or-swim competition with foreign businesses, the business environment, rather than unions, forced companies to increase their rates of productivity while improving the quality of their products. Those companies were left with little other choice but to pay workers a competitive wage and treat them with dignity and respect.

Some companies, however, have not benefited from the diminished influence of unions. Rather, they invite union organizing efforts by mistreating their employees and by failing to pay a competitive wage.

While some unions took great effort to organize the unhappy, demoralized workers at such vulnerable companies, the AFL-CIO, under the stewardships of John Sweeney and Lane Kirkland, did not. Instead, they devoted their efforts to politics, using an ever-increasing percentage of union dues for political campaigns and PACS, and spending less and less time organizing workers. And what did the AFL-CIO accomplish? Not much. They allied themselves with the Democratic Party during a time when it was losing both houses of Congress and the White House.

Break-Away Unions

Dissident members of the AFL-CIO read the tea leaves which contained their own epitaphs: Unless they took dramatic action and created effective tactics and strategies to breathe new life into the union movement, their unions would join the extinct ranks of the dinosaurs.

The United Food & Commercial Workers (UFCW), The International Brotherhood of Teamsters (IBT) and The Service Employees International Union (SEIU) decided to break away from the tired, old established institution that the AFL-CIO had become. Those three unions, along with several others, are now planning numerous new organizing efforts that they hope will breathe new life into the union movement. Their efforts, however, will also shackle many manufacturing and service companies that must compete with companies in China, India and Vietnam. The breakaway unions will also be organizing grocery chains, drug store chains, nursing homes, hospitals, colleges and universities, high tech companies, telecoms, and transportation companies, among others. One of their marks -- and it's a big one -- is WalMart. In fact, all of the "super stores" and mass-market retailers have large targets painted on their backs.

What should a targeted company do? It's quite simple: if management does not prepare for an onslaught of new organizing efforts, a company will have invited the success of militant unions which are fighting for their survival. If they are initially successful, that success will encourage the creation of even more militant unions, which will attempt to organize more and more companies. Their tactics will be as aggressive as the law permits. Employees who had not belonged to unions will opt to join those that promise an increasingly attractive menu of benefits. And for workers who are already union members, their representatives will have no choice but to indulge in more aggressive collective bargaining tactics, just to keep up with the break-away militants.

Faced with a growing union militancy, employers must respond first by evaluating how they treat their employees. If employees feel that they are not being treated well and fairly, they will undoubtedly turn to unions. Employers must remedy such situations as rapidly as possible if they wish to remain union-free.

Action Plan

The following is an action plan that will help corporate America satisfy their workers so that they do not feel compelled to join unions.

To begin, employers must create a forum in which management and employees talk and listen to one another and resolve problems together; this will result in increased trust of management by employees. Employees will only receive management's communications credibly if open and ongoing communications exist pursuant to a specific strategic action plan. In addition to defined timetables, chosen individuals must bear specific responsibilities.

Furthermore, management must not wait until problems arise before initiating its plan. One of management's biggest mistakes is to wait until a labor problem arises to open the doors of communication. Management often decides that the appropriate time to talk with their workers is only after it is faced with negotiating a new union contract or dealing with a union organizing effort. Quite simply, that is too late. Workers naturally suspect management's motives and regard everything it says with cynical disbelief if management's actions are reactive, rather than proactive.

An ongoing strategic communications plan will ensure management's credibility. Real credibility can only be built upon a foundation of asking, listening, talking, and acting in response to employee needs and issues. Management cannot sincerely ask, listen, and talk if it is ignorant about those with whom it converses. Therefore, management should know each worker's name, job description, family background, and be familiar with each worker's performance record. Such basic knowledge implies a level of care and concern.

How To Communicate To Employees & The Art Of Listening

Employers' genuine concern for employee welfare will go a long way towards establishing trust. There are many ways of communicating concern and building trust, and each is a necessary ingredient for a successful communications action plan. We have helped management communicate its concern for employees not only by creating an "asking" program that listens to employee concerns, but also by creating a variety of cost-effective benefits, such as by providing small, short-term, interest-free loans in case of emergencies. We have also helped companies implement regularly scheduled procedures that communicate management's goodwill and positively impact employee morale, such as sending anniversary and birthday cards to employees, paying for birthday and/or anniversary dinners for employees and their spouses, and facilitating child-care arrangements. Among other means of communicating concern are providing financial information about retirement investments, offering fitness and stress reduction classes, and having a guidance counselor offer advice to parents about college admissions and costs. All of the above communicate management's interest and concern, and make employees feel like valued stakeholders in their companies.

Having successfully communicated its concern for its employees, management can open more direct channels of communication, knowing that its credibility is secure.

Nothing is more effective than one-on-one discussions where management asks, listens and talks, and encourages employees to do the same. It may take only seconds or minutes, but it should be a requirement of the communications strategic action plan. It is also a reaching out effort that includes such basic questions, as "How are you or, "Can I help you?" It permits employee's multifaceted opportunities to address issues in an open and friendly environment. Other kinds of meetings where management and employees can engage in direct and forthright communications include group meetings, complaint meetings, quality circles and meetings for senior employees.

Group meetings can occur bi-annually, quarterly, or even monthly. At such meetings, management can explain what it is doing and why. It can answer workers' questions, thus diminishing the opportunities for misunderstandings, which -- if left to metastasize - can grow into major labor relations problems.

Complaint sessions are an effective means for maintaining a reasonable level of satisfaction among all types of workers. Such meetings are generally held monthly, and are sometimes referred to as "coffee and donut meetings." Management can provide updates on important subjects, and employees are encouraged to discuss any aspect of company policy, sales, earnings, expansions or other company business. These meetings occur during the workday, and employees are paid for their time. Defused negative rumors, revised production methods, and increased understanding of new company policies are just some of the positive results of such meetings.

Quality circles are another effective form of meeting in both union and non-union settings. Quality circles consist of small numbers of employees; the circles are more intimate than complaint sessions. Dealing with small numbers of employees permits management to tackle problems of workplace efficiency through a one-on-one give and take. Together, management and employees examine productivity, and make suggestions for improvement. Employees are left with an enhanced sense of their own competencies and efficiencies, and become stakeholders in systems which they helped design.

Meetings just for senior employees have proven to be an effective means for communicating management's appreciation for their long-term commitment to the company. It is essential that management demonstrate that such employees are held in a special position and are appreciated for their long-standing commitment to the company's welfare. Senior employees may be given a pin, which signifies appreciation -- "thank you," after all, is one of the most important phrases in the English language that communicates appreciation and gratitude. Unfortunately, management too often takes employee efforts for granted and rarely says "thank you."

An E.A.R. For Listening

Management can also utilize an Employee Assistance Representative (an EAR), who will interact with an HR representative to make sure that all employee issues are addressed. The designated EAR, who may be chosen by both employees and management, by management alone or through a roster of volunteers, should serve on a rotating basis, so that interested employees have an opportunity to serve in that position and to interact with the HR department. The purpose of the program is to have a peer person available to communicate that management cares by responding to and acting upon employee concerns, and to assist employees with their problems. In establishing the program, management further communicates and demonstrates its commitment to addressing its employees' concerns. This type of initiative has power to improve greatly workplace environments at very little cost. The return on such an investment, in fact, has been tremendous. We have seen companies benefit more from an EAR program than it would have benefited from a modest pay increase.

The Written Word

In addition to personal contact, there are written means for communicating with employees. Among those forms of communications are newsletters, personalized letters, private memos, public notices and self-appraisals.

Newsletters may be mailed to each employee's home or distributed at work. Such newsletters will not only inform employees of company programs, but will also be read by family members, who will come to have a benignant view of the company.
Another effective written communication is the personalized letter mailed to individual employee's homes, thanking them for their help.Similarly, management can convey important reminders, notes of appreciation, and the accomplishment of goals in memos, each of which is to be placed in employees' pay envelopes.

A bulletin board, placed where all employees can view it, can serve as a community newspaper, and provides an opportunity to reach all employees with important announcements. Among the kinds of information that should be displayed on a bulletin board are notices about company policies, work rules, employee events, jobs and requirements.

Self-appraisals are an effective means for employees to relate valuable information about themselves, management, and their peers. It can all be performed using simple written forms.


Award programs further provide management with another effective tool for communicating its appreciation for employees.

One such program is a Service Award Program, which permits companies to retain their best employees by recognizing their contributions to a company's overall success. Service Award Programs serve to build employee self-esteem, reinforce desired behaviors, and further develop an atmosphere of appreciation and trust. Most company award programs are for tenure alone. However, Service Award Programs should recognize length of service, as well as the quality of that service.

When presenting awards for length of service, employees should be recognized at the conclusion of an initial probationary period, and following first, third, fifth and tenth year anniversaries with a company. Asking employees about meaningful awards will result in the presentation of appreciated awards, which may include small cash gifts, gift certificates, tickets to sporting events or dramatic performances, company merchandise and jewelry. To maximize the positive impact of such awards, presentations should be made at company-sponsored events such as annual holiday parties or summer picnics. The presenter of the award should be a member of top management.

The second type of service award is one that recognizes the quality of an employee's performance over a period of time. There are numerous processes for selecting recipients of this kind of award, one of which, for example, may begin with management forming a committee comprising five to seven people, each of whom will participate on a voluntary basis. Hourly employees may be the majority of those serving on the committee. The committee could select employees from different classes of responsibility and skills. Awards should be based upon attendance, safety, team building, productivity and other positive criteria deemed to be important within the corporate culture. Awards should be of greater monetary value than the previously described awards for length of service.

Another category is the Suggestion Awards Program. On a monthly basis, management may select an important and topical issue about which they solicit employee suggestions. Management may, for example, ask how they and employees can work more effectively to reduce production costs, reduce absenteeism, improve efficiency and productivity, and discuss other matters of mutual concern.

A committee of three to five people, representing both management and hourly employees, reviews subsequent suggestions. Again, hourly employees should be the majority of committee members. Top management may choose management representatives, but the hourly employees should all be volunteers. The committee should meet within seven days following the end of every month and review the suggestions. By majority vote, they should choose a winning suggestion. The author of the winning suggestion could receive a cash prize and a suggestion award plaque with the employee's name inscribed on a plaque. At the end of the year, one of the twelve monthly award winners could be chosen by supervisory management or a committee of management and employees; that person should receive a larger cash prize, a special inscribed plaque, and have his or her photo placed in a special corporate location to be seen by all employees.

Exit Interview

Another part of a strategic communications action plan is the exit interview. It provides management with one of its best opportunities to gain candid appraisals from departing employees about the company. When an employee leaves a company, that employee is likely to feel free to voice candid concerns, opinions and advice. During such interviews management can learn a great deal about problems that an employee may have been hesitant to express while employed. One can garner valuable information about where a company must improve working conditions, where it needs to make changes in its corporate culture, and how to increase its own levels of trust and credibility. Such insights will ultimately serve to enhance levels of productivity and efficiencies.


All of the above are some of the necessary ingredients for an effective strategic communications action plan. The implementation of each ingredient, of course, depends upon a company's culture, time frame, and other variables that will determine whether the action plan will be expanded or reduced.

Only when management and employees talk and listen to one another and discuss issues of immediate concern will both sides be on the road to mutual understanding that can lead to agreement. Companies that fail to ask, listen, talk, take action and open numerous channels of communications feed adversarial relationships that will lead to unions where none exist, and cause slowdowns, walkouts, and strikes where unions are already in place. A decreasing bottom line will surely demonstrate the shortsightedness of not having a strategic communications action plan. That plan must be part of a company's overall business plan and its labor-relations plan which is incorporated in the business plan; it should be audited every six to nine months or more regularly, if needed.

The strategic action plan of open communications that we have explained in this article is designed to break down adversarial relations, establish perceptions of management's goodwill, and reduce the effectiveness of union organizing efforts. If followed, it will ensure years of increased productivity and profitability with little or materially reduced labor strife. The positive results will go directly to a company's bottom line.

Stephen J. Cabot is Chairman of The Cabot Institute for Labor Relations (, is a nationally renowned management-labor lawyer. He is also the author of the best-selling books, Everybody Wins!, Up From Confrontation, and Stephen Cabot's Complete Guide to Labor Relations in the 21st Century. His e-mail address is [email protected]

Julius M. Steiner is Chairman of the Labor Relations and Employment Law Department at Obermayer Rebmann Maxwell & Hippel, LLP ( Mr. Steiner's practice is dedicated exclusively to the representation of management in every phase of labor relations. His e-mail address is [email protected]

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