CONFLICT MANAGEMENT The Psychology of conflict and conflict ...

374 FRIEDMAN, HUNTER, AND CHEN
Thus, the establishment of partnerships depends either on both parties
perceiving that their interests lie in such cooperation or on one side having
sufficient power to force the other to cooperate. Only occasionally have
unions with such power deployed it in this fashion; it is a risky strategy
and the benefits are uncertain.
Corporate Boards of Directors. A different approach to union involvement
in strategic or business decisions is to establish union representation on
corporate boards of directors. This is one way to provide a strategic partnership
more firmly grounded in rights rather than in power. In Germany,
for example, the law mandates such “codetermination” in large companies.
In the United States, such representation is not mandated, but may
be bargained for or may accompany employee stock ownership. Throughout
the 1970s and 1980s, for example, unions won the right to nominate
directors in conjunction with negotiations over wage concessions and the
extension of stock ownership to employees (Hunter, 1998). Unions such as
the USW and IAMAW have also pursued board seats as a way of supporting
their other partnership efforts.
Chrysler was the first leading American firm with union representation
on the board. UAW President Douglas Fraser assumed a directorship
in 1980 and was succeeded in 1984 by Owen Bieber. After several years,
the UAW did not emphasize preservation of the board seat as a bargaining
objective, and the corporation restructured its board, dropping Bieber
in 1991. Nevertheless, experiments with board representation have continued.
Appelbaum and Hunter (2004) listed over 20 leading firms with
union representatives on the board. Such representatives include active
unionists, workers, retired union leaders, and “neutrals” sympathetic to
union ends including consultants, lawyers, and professors.
Occasionally, boards of directors have emerged as forums for labor-management
dispute resolution. However, this is uncommon. Union representatives,
like other board directors, are legally charged with representing
shareholders’ interests, and these fiduciary duties block directors from
explicit representation of workers’ concerns. Further, except in extreme circumstances,
American boards rely more on consensus rather than on constituency
representation or explicit negotiation among competing interests.
Managers and most directors do not see boards as appropriate venues for
resolution of differences between labor and management, and thus only
topics likely to generate consensus are easily tackled at the board level.
Board representation does not ensure that the parties will work together
to address joint concerns. United Airlines provides a recent example of
the associated difficulties. The Airline Pilots Association (ALPA) and the
IAMAW obtained one seat each on the board of directors (along with share
ownership for their members) in 1994. Following the employee buyout of
United, trust between top managers and the unions eroded. Collective
bargaining over wages and benefits was heated and contentious, proposed
mergers (e.g., one with USAirways) provided further controversy, and