Business Negotiation Techniques

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Business Negotiation Techniques
(Part time) BA Hons Business Management, Staffordshire University Student number: 09006130
Date of submission: 10/05/2012

The negotiation of London Underground and the Tube Worker’s Union over working hours and bonus pay during the 2012 Olympic Games

Task 1: Issues
a) Substantive Issues of the negotiation

At the beginning of the negotiation between London Underground (LU) and the tube workers’ Union (TWU), the substantive issues broadly relate to the working hours of tube workers during the Olympic Games and the amount of the bonus payment workers will receive in return.

The positions of both parties regarding these issues are illustrated by the behaviours they demonstrate in the early stages of discussions. Putnam and Jones, 1982 identified some of the behavioural characteristics of labour and management during negotiations:

Union negotiators define their roles as low in autonomy with limited control over resources; thus they attack management. Additionally, they use more requests, more tentative statements and more appeals to what ought to be done than do management. In contrast, management negotiators capitalise on their status by making high confidence statements, by using substantive arguments and by being more decisive. Putnam and Jones, 1982 p386.

Another factor which determines the parties’ position is the level of importance associated with each issue. Early in the negotiation, LU issued a statement clearly outlining their requirements for worker’s to carry out extended shifts of more than 8 hours with finishing times later than 1:30am. As their objective is achieving a high standard of transport services during the Games, LU have been made a clear statement on their position, demonstrating their decisiveness on this important issue.

TWU appeared to take a different position on this issue, expressing concerns over the increased level of expectancy being placed on workers, whilst questioning the implications this may have on members’ health and safety during a time when the tube network will experience unprecedented levels of demand.

The issue of worker’s bonuses is the other substantive issue being discussed. The initial proposal of LU included a £500 bonus for working the extended hours. By citing the significant demand on workers and their important role in LU’s transport plans, it could be said these factors contributed to TWU’s position on this issue. As with most negotiations over price or wages, TWU are likely to target the largest bonus they can realistically achieve and so they rejected this offer on the basis that the amount was not enough; in light of the demands being placed on workers.

In the case of LU, the £500 bonus is likely to represent their target figure in the negotiation, as this is the amount they consider to be the lowest bonus payment TWU will accept. It is reasonable to say LU may consider their requirements on working hours to be appropriate in light of their transport requirements and may cite this along with budgetary restrictions as a rationale for adopting a different position to TWU on the bonus pay issue.

b) Subsidiary Issues of the negotiation

The subsidiary issues became known while the discussions were on-going and do not appear to have been discussed at the beginning of the negotiation. The first of these issues introduced by LU was that workers agree to changes to their working locations and shift duties at short notice.

The second issue relates to the period of time this flexibility in shift patterns would be required for. LU stated that they wanted workers to agree to provide greater flexibility for up to two weeks prior to the start of the Games and for an undefined period after the Games had closed. These issues were required in return for an improved £850 bonus payment. Howard Collins, the Chief Operating Officer of LU outlined their proposal on these issues in a statement: We have put forward an...
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