CHAPTER 15
Labor Relations
Leonard H. Friedman, PhD, MPH
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1
Employee Relations Philosophy
and Strategy
• Part of overall policy development
• Geographic, demographic, and historical factors
• Developed on basis of objectives
– Communication with employees
– Management rights
– Union preferences
• Formal vs. informal nonunion policy
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2
Nonunion Status
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Unions preventable by management actions
Positive employee-relations climate
Workers seek union assistance
Workers vote against management, not for a
union
• Union avoidance is winning
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3
Labor Law History and Trends
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National Labor Relations Act (Wagner Act)
Taft-Hartley Act
Landrum-Griffin Act
1974 Amendment
– Labor laws included health care organizations
• Difficult for managers to stay nonunion
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4
Labor-Management Problems
• Fundamental differences between goals and
objectives
• Management rights
• Efficiency vs. human value
• Organized labor shifts locus of control
• Cost constraints on management
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5
Why Do Employees Join Unions?
• Three main issues
1. Wages
2. Dissatisfaction with work benefits
3. Perceptions about the organization
• Increased unions in health care
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6
Why Do Employees Join Unions?
• Hospital administrator errors
• Acceptance of the notion that low wages and
poor fringe benefits cause dissatisfaction
• Assumption that interviewing of supervisors is a
true barometer of employee feelings
• Ignorance of what is troubling the employees
– Not listening to the employees’ understanding
– Not allowing communication to flow
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7
What the Union Organizer Looks For
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Usually invited by workers
Employee loyalty by work shift
Female-male employee ratio
Work environment and job safety
Wage rates
Incentive pay
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8
What the Union Organizer Looks For
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Overtime practices
Seniority
Job security
Promotion policy
Fringe benefits
Discipline and grievance procedures
Multiunit systems
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9
Proactive Management Program
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Many types of management responses
Practical
Suited to the situation
Improving in an honest and fair manner
Unique strategy around employee-related
issues
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10
Proactive Management Program
• Nonunion policy
– Careful consideration
– Labor counsel
– Communicating policy
– Inform prospective employees
– Publish in employee handbook
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11
Proactive Management Program
• Nonunion policy key resolutions
– Equitable treatment of all employees
– Commitment of adequate funds and time
– Philosophy that each employee is important
– Oppose efforts of outside organizations
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12
Proactive Management Program
• Personnel selection
– Proper matching of personnel to jobs
– Good wage and salary program
– Job analysis, job description, job evaluation
– Basis on individual qualifications and specific job
requirements
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13
Proactive Management Program
• Employee attitude assessment
– Employee attitude surveys
– Valuable management information
– Differentiating between positive and negative attitudes
– Planned, periodic basis
– Take corrective actions
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14
Proactive Management Program
• Employee training
– Function of management
– Assume responsibility
– All levels
– Performance standards
– Positive relationship between performance and reward
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15
Proactive Management Program
• Employee value systems
– Different among employee groups
– Professional and nonprofessional
– Tribalistic to existentialist
– Innovative responses from management
•
flexible work scheduling, earned time programs, methods of
job enrichment, and a cafeteria-style approach to fringe
benefits
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16
Proactive Management Program
• First-line supervisors
– Important in preventing labor problems
– Determine how policies are implemented
– Liaison between employees and management
– Evaluate first-line supervisors
– Additional training or termination
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17
Proactive Management Program
• Performance appraisal
– Reflects management’s desire to develop employees
to their optimal potential
– Conducted honestly and on a regular basis
– System not as important as those who implement
it—first-line supervisors
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18
Proactive Management Program
• Disciplinary policies and procedures
– Consistent
– Fair
– “Just cause”
– Grievance procedure
– Prompt action
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19
Proactive Management Program
• Wages
– Competitive rates
– Compare rates frequently
– Conduct own wage survey
– Wages not main factor
– Good wage levels not sufficient
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20
Management Reactions to Unionization
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Well-planned strategy
Employers have rights—uphold them
Fear tactics lack success
Stress desire to remain nonunion
Factual information
Shortfalls of unions
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21
CHAPTER 14
Compensation Principles for the
Health Care Environment
Cheryl Locke, BA
Alesia Jones, CCP, MBA
Katrina Graham, MBA
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1
Importance of Compensation Strategy
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Critical to overall organizational success
People can be competitive advantage
Compensate for an advantage
Large part of budget
Significant financial impact
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2
Compensation Strategy
• Five key elements
1.
2.
3.
4.
5.
Forms of compensation
Workforce demographics
Business cycle
Compensation philosophy
Legal and regulatory compliance
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3
Compensation Strategy
• Solid compensation program in place
• Assumes accurate job descriptions and
specifications
• Internally equitable and externally competitive
• Pay systems monitored and maintained
• Many steps
• Difficult and never ending
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4
Forms of Compensation
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Indirect compensation
Direct compensation
Variable compensation
Hourly vs. salaried jobs
Fair Labor Standards Act
Different mixes for different groups
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5
Forms of Compensation
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6
Forms of Compensation
Copyright © 2010 Delmar, Cengage Learning. All Rights Reserved.
7
Workforce Demographics
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Changes over time
Ages 20 to 70
Employee surveys
More flexibility in scheduling
Work-life balance
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8
Workforce Demographics
• Entitlement culture
– Automatic increases
– Incentive continued
– Benefits increase
• Performance-based culture
– Incentives reflect performance
– Bonus compensation
• Most organizations in between
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9
The Business Cycle
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10
The Compensation Philosophy
• Market-based pay
– Position in the labor market
– Match-the-market
– Lag-the-market
– Lead-the-market
– Strategy for each position
– External market data
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11
The Compensation Philosophy
• Competency-based pay
– Rewards for tasks, duties, responsibilities
– Knowledge-based pay
– Skill-based pay
– More emphasis on training
– Identify and monitor competencies
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12
Individual vs. Team Rewards
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Health care organizations using more teams
Difficult
Variable pay added to base pay
Greater sense of equity
Reward team for improved performance
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13
Perception of Fair Pay
• Compensation not primary driver of satisfaction
• Satisfiers
– Job itself
– Leadership
– Growth and opportunity
– Purpose
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14
Legal and Regulatory Concerns
• Fair Labor Standards Act (FLSA)
– Minimum wage rates
– Exempt employees
– Child labor
– Hours worked
– Overtime pay
– Compensatory time off
– Fastest growing areas of HR complaints
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15
Legal and Regulatory Concerns
• Independent Contractor Regulations
– Growing in health care organizations
– Three advantages for employer
1. No social security, unemployment, or worker’s compensation
2. No overtime pay
3. No benefits
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16
Legal and Regulatory Concerns
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Equal Pay Act of 1963
State and Local Laws
National Labor Relations Act
Garnishment Laws
Compensation communication issues
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17
Individual Compensation
• Red-circled employees
• Green-circled employees
• Pay compression
– Pay difference becomes small
– Competitive market shortages
– No easy fix
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18
Pay Increase Issues
Pay adjustment matrix
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19
Pay Increase Issues
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Seniority
Cost-of-living adjustments (COLA)
Lump-sum increases
Pay-for-performance
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20
Staffing Shortages
• Staffing levels
– Core employees
– Contingent workers
• High tech
• High touch
• Different types of nurses
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21
Executive Compensation
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Different than nonexecutive pay
Executive salaries
Executive incentives and bonuses
– Long-term
– Short-term
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Executive benefits
Executive perquisites
Reasonableness?
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22
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