CONFLICT MANAGEMENT The Psychology of conflict and conflict ...

368 FRIEDMAN, HUNTER, AND CHEN
an award that favors the more extreme party. Research into the extent to
which interest arbitration has this effect has yielded mixed results. One
recent study found that bargaining units covered by compulsory arbitration
are 8.7% to 21.7% more likely to have an impasse than bargaining
units are in sectors that provide the right to strike (Hebdon & Mazerolle,
2003). Yet Farber (1981) argued that exogenous factors might affect arbitrators’
decision making so the expected outcome may not be the midpoint
between the two sides. Farber and Katz (1979) also argued that the uncertainty
created by arbitration outcomes gives parities the incentive to negotiate
and reach a settlement.
The “narcotic effect” refers to the concern that once the parties start
using interest arbitration they will become increasingly dependent on it in
subsequent negotiations. Here, too, empirical findings have been mixed,
with some studies finding this effect (Butler & Ehrenberg, 1981; Hebdon
& Mazerolle, 2003), but others failing to do so (Champlin, Bognanno, &
Schumann, 1997; Chelius & Extejt, 1985).
Living Contracts. Another trend toward more integrative approaches to
conflict resolution is more radical. “Living contracts” do away with the
notion of fixed rules that remain in place for the duration of a contract.
Living contracts provide for an ongoing, cooperative bargaining process
between labor and management that allows rules to be changed when
circumstances change during the life of the contract. This approach is not
pervasive, and it is relatively early to assess the promise of this trend.
Where there is enough trust between labor and management, living contracts
can help overcome some of the rigidities that managers and observers
see in a New Deal style approach to workplace dispute resolution.
In the late 1980s, for example, living contracts between the Rochester
school district and its union helped it to smooth the operation of the
schools and establish a timely problem-solving mechanism (Urbanski,
2001). Since 1993, 11 major San Francisco hotels have implemented living
contracts. These contracts helped the hotels compete effectively (in particular,
weathering the 2001–2002 recession), enhanced workers’ job security,
and provided a platform for workers’ skill acquisition (Korshak, 1995;
Tate, 2004). Labor-management cooperation, however, is a key foundation
of a living contract, and such cooperation is difficult to sustain. Many of
the same San Francisco hotels that were considered prototypes for the
implementation of living contracts have quite recently developed conflicts
that threaten their cooperative relationships and the extension of the living
contract (Tate, 2004).
eleMent 3: GrievanCes anD arBitration
The “living contract” notion notwithstanding, in American labor relations
a contract settlement establishes the rules of the workplace. Conflict,