Final Individual Assignment - Complaints Collaboration: “Negotiations”

Complaints Collaboration: “Negotiations”

        Complaints in a board sense means when one party dis-satisfy the second party or third parties service or offer, and voice out direct or indirect for a much fair treatment or reclaim. They usually are set up in different dyads such as, Organization and Customer, Organization and Employees, Husband and Wife, Parents and teachers…etc. the dyad varies in different situations and usually there are platforms for the complaint parties to unleash their dis-satisfactions.

        There are different ways for complaints parties to voice out for a better treat or reclaim but the process for reaching a satisfactory outcome is called “Negotiation”. Negotiation in a simple form is to get the relevant parties sit down together to form an outcome; usually parties could possibly involve in negotiation included businesses to business, employers, employees, customers…etc. Negotiation is a process for two or more relevant parties (stakeholders) to have a common dialogue that intended to reach an understanding and agreement for a satisfactory outcome for individual or collectives [1]. In many negotiation cases, the party who get more advantages from negotiation does not purely depend on their bargaining power; it does depend on the negotiation strategies they applied.

        There are thousands of negotiations happen every day between business, employers, employees and customers, but one of the most recent and well-known one in addressing complaints that involved negotiation is The “ Hong Kong Dock Strike”[2] that happened in 2013. Along this paper, this Labor unrest case will be analyzed showing how negotiation strategy or sub-strategy creates values which may leads to a different outcome. It will be also shown the how taking the wrong move will cost one party lose the advantage and ends with not an ideal outcome. Also to illustrate how external influences could also affect the outcome.

Complaints & Labor Strikes

Complaints Cause

        The complaint was happened in March 2013 and it was triggered from employees to employer. The relationship is that the port operator Hong Kong International Terminals Limited (HIT), subsidiary of Hutchison Whampoa Ltd. hired sub-contracting companies for managing the operation of Crane, stevedores and docking service in Kwai Tsing Container Terminal [3].

There were over 300 Dockers, Crane operators and Stevedores demands to have pay raise for 20% up since there were not any pay raised since 1997 and the per hour wage is actually lower today when compare to what the Dockers had in 1997[4]. The second complaints were about the poor Booth/Cabin working conditions for Crane operator and demanding for a desperate improvement from the port operator. The third complaint was to also to complain for non-human long consecutive hours of work from 24 hours up to 72 hours which the pay was not reflected on.

Labour Strikes

The strikes started with around 100 Dock workers on 28^th march wanting to have 20% wage increment from the employers (direct employed sub-contracting companies) [1]. And very soon after, there were 200 Dock worker were joined the Labor strikes protest outside the Kwan Tsing port terminal overnight. On the next day, the general secretary of the Hong Kong Confederation of Trade union joined the workers for salary increase. An important point to note which will be important for use to analyze the negotiations case is that the General Secretary of Hong Kong Confederation of Trade Union, Lee Cheuk-Yan is also a chairman of “Labour Party” [6] and an incumbent member from Legislative Council. As soon as Lee Cheuk-Yan has come with their protest slogans and banners, went complaining outside the sub-contractors’ office( Office set up inside the port terminal) requesting for a Negotiation which resulting for a 40 days long labour strike.

Labour Strikes Negotiations

Labour Strike Negotiation – “First Touch”

        On the second day of labour strikes, it was already two hundred workers strike, and stayed overnight and Hong Kong Labour Department came and tried to mediate the difference between the workers and the contractors. However, due to the Labour party [6] was joining for the negotiation held by HK Labour Department, four out of five contractors had fled from the negotiation. The reason was very obvious; it is because the contractor (Employer) knows Labour Party is a political party and they are very extreme on hard on people and then matters especially issues that can enlarge their votes for staying in legislative council. During the period between first scheduled negotiation and the second negotiation, within 3 days Labour Party Lee Cheuk-Yan brought a few hundred volunteered students and workers with offensive banners and slogans to contractors’ offices and also protested to Cheung Kong Building where it is the head quarter for Richest Man in Hong Kong, the owner of Hutchison Whampoa Company; on top of that, Labour Party and the workers also went to interfere Mr. Lee Ka Shing life by protest to his house and asked for reply when the responsibility wasn’t really from him and just because he owned more shares for the port terminal. Lee Cheuk-Yan also represented the workers and announced through media that no Negotiation will be done unless 2 request is fulfilled “all contractors are attending and negotiate with workers including the Terminal owner, and Labour Party must be attending to the negotiation and as a negotiation consultant team ” [7][8]

        A few more days later, due to continuous occupied the port terminal and Labour Party kept persuades other workers to join their Labour strike. Also Labour Party issue money as an emergency Alms for workers. Since there was no collaboration from the labour reprehensive, the Hong Kong Port Terminal was paralyzed and the importing and exporting business of Hong Kong was under crisis, (Appendix, Picture 1).

Picture 1: Source from:http://cdn.thehousenews.net/media/photos/cache/IMG_6097_z6mVi_600x0.jpg

Picture 2. Source from:http://sarg-merit-fault.blogspot.hk/2013/06/2013_25.html

Picture 3. Source from: http://news.163.com/photoview/00AN0001/33276.html#p=8RFCPL6D00AN0001

Labour Strike Negotiation – “Final Deal”

        There were actually quite a few negotiations between employers and workers, of course, contractors, Labour Party and HK government, Labour Department.  Labour Party demand contractors to negotiate issue by issue basis and to fulfill their needs. The workers claimed the work environment were severed and inhuman, also asking for 23% of salary increment [8]. In the second negotiation, Employers (Contractors) suggested a “Package Deal” of 5 + 2 proposal where having 5% of immediate salary increment plus 2% of welfare [9]. Contractors also agreed to upgrade work cabin facility, e.g. adding extra toilets, increase number of breaks in a day and elongating the lunch hours. Contractor offered the salary increment by explaining on the global economic issues, and the 5% salary increase plus 2% welfare are already exceed average rate within the whole industry and over the company’s financial burden. The second negotiation offer was also rejected from the labour since the offer was not met the demand from their proposed 23%[10].

        The action token from Labour side was after the first and second deal, they intruded into Cheung Kong Building, Lee Ka Shing’s Head quarter, protested to Cheung Kong Building and Hutchison Building, Protest to Mr. Lee Ka Shing’s house, Paralyzing the whole Hong Kong import and export business. On the other hand, the action token from the employers side were to offer one off compensation for returning to work and get the terminal running at a minimum rate and promised not to investigate about the strike workers.

       

        The third negotiation, day 36 was also rose to the media headline due to one of the five contractor was declared bankruptcy due to vacant works done and money lost over a month labour strikes. The remaining employers (Contractors) offered 5+2+5 proposal. That is to say 5% immediate salary increment and 2 % welfare and 5% more for next year’s increment. This was proposal was also rejected [10] because the Labour Party thought the proposal with 5% increment was unacceptable.

Just before the last negotiation, Lee Cheuk-Yan put an offensive banner (Appendix Picture 2) targeted to Lee Ka Shing and targeted to interfered Hutchison Whampoa’s retail business by destroying and disrupting in his front line retail business. Lee Cheuk-Yan had engaged a word war over media through anti-government newspaper Apple Daily [11]. The word war was triggered between Lee Cheuk-Yan, Canning Fok (Managing Director of the Hutchison Whampoa and Hutchison Port Holding Group Managing Director John Meredith [12]. From the Hutchison Whampoa Canning Fok claimed that the profit from the terminal was only less than 1% from the main group, also the workers are sub-contractors’ employee; Hutchison should not take the blame because they were not Hutchison’s employee; furthermore it is also impossible to force workers to work 24 – 72 hours straight and unrest, therefore the accuse from Labour Party and Labour representative was not true. On top of that, Canning Fok also questioned about Lee Cheuk-Yan was not genuinely interested in helping the worker but to enhance his only bargaining chips from a political point of views and [13]. John Meredith also pressed on the newspaper accuse about Lee Cheuk-Yan for putting “Cultural Revolution Style” banners to Lee Ka Shing. Lee Cheuk-Yan had fought back by saying the Hutchison company was playing delay tactics for delaying the negotiation [13].

        The Final Negotiation, Day 40. The remaining four contractors had offered 9.8% salary increment for all workers and the promised facilities improvement and at last the labour side had agreed and claimed a “WIN” [14].

Negotiation Strategy & Frame Works, Pros and Cons.

       

Employees (Workers’ side)

The collaboration in negotiation is mutually to reach a win-win situation as stated from Leigh L. Thompson (2009) [15] win-win was not a fair division of resources (p.74-75). Therefore the negotiation between employer and employees should not include deals like if company earns more, employees should benefit equally. However, if we analyze how Worker’s and Labour Party tackle the negotiation, what would they do?

The workers started off by letting Labour Party, a political party as a representative or speaker to voice out their need. The approaches the workers had taken has actually affect the negotiation outcome as the mediation was involved with an unwanted party from employer’s perspective, this has also mentioned in Danny Ertel (1999) [16], where the workers have taken the wrong notation on the Relationship cycle (p.64). The worker did not use better approaches to improve more understanding with the employers and gain trust, yet, instead they invited an unwanted politically extreme party to join accusing their employer and also tried to raise their bargaining position by exaggerating the work conditions and set a sky high salary increment right at the beginning with the media and the press. Furthermore, the relationship was racked by starting labour strikes before any moderate negotiations. The starting framework was already questionable.

The starting strategy from worker’s side was not targeted for a win-win negotiation; they requested to get all five different companies to attend at the same time as a collective or no negotiation will be done while each company’s employment package could be different. The transparency negotiation of this act could cause adverse effect as lower offer package workers from company A could found out company B is actually better and move across to company B. As such, the good way is common issues can be discussed in one lump sum and creates more transparency and gaining collaboration between parties; on the other hand, transparency from different organizations could be dangerous for exposing their offers and reduce the worker’s competitiveness when all wages are aligned between five companies. The workers work the negotiation in a High concern for goal and low concerns for relationship, that is to say they were using distributive bargaining style as Kandarp Mehta (2012. Issue15) has point out, the workers want to get bigger slice of the pie than their employer and treat the negotiation as a fixed-pie (p.52) [17]; hence it will become a win-lose situation because the negotiation has not been carried out creatively by the negotiator, therefore as mentioned in Leigh L. Thompson (2009) integrative agreement would not be achievable and less collaboration to the final outcome since the worker’s side did not understand the different preference between parties within the negotiation (p.76-77)[18].

The distributive approach from workers can be illustrated via the rejection from worker on employer’s proposal and insisted on their original 23% proposal. Furthermore, as shown in Appendix, Picture 3. The protest has brought in political issues had ruin the negotiation by giving extra un-necessary slander or embarrassment to employer and dragging other parties in the labour strike would complicate the negotiation case. In Appendix picture 3 shown some students and political parties even raised British-Hong Kong flag to support the strike and by paralyzing the whole Hong Kong’s import & export business to force employers to “Compromise”. This act will give employers extra burdens in decision making and complicating the whole negotiation process as mention previously. This is also one of the reasons why it causing one of the contractors had to claim bankruptcy during the strike.

Employers (Contractors’ side)

The employers had approach the negotiation differently; they tried to reach a win-win outcome as it has more direct profit & loss consideration in offering new salary proposal to workers and shortening the negotiation period.

Employer had used what Kandarp Mehta (2012. Issue15) has point out, an integrative approach to collaborate with workers during negotiation (p52) [17]. This is to say they tried to enlarge the pie by thinking creatively and understanding employee’s needs instead of dividing the fix pie, such as providing a package deal as Leigh L. Thompson (2009) had stated about making a package deal instead of single issue offer. This would allow negotiator to trade off some other issues to reach an outcome reaching collective advantage; the package deal is to make multiple offers that are value equivalent to ideal proposal [19]. In context of the labour strike, as mentioned previously, Employers had offered package deal of 5 +2 proposal where salary increment, facilities enhancement and furthermore an extra welfare benefit had also kicked-in to seek for a side deal to complement for not reaching 23% of salary increase. Other approaches employer’s negotiator had used are BATNA [20]. Employers had set their BATNA and consider their employee’s BATNA through negotiation. In the Labour Strike context, at the beginning Employer’s BATNA is weaker because there isn’t any choice for employer but to come up with a proposal to settle the strike, and the media press, political; issues had also made their BATNA weaker. However, since employers understand employee’s BATNA, knowing if workers returning to work in a longer period of time, they would have financial burdens. This is why there were side deals and off-line persuasion with workers that has been made, asking workers to return work will then receive HKD 5000 for those who returned and HKD 2000 if continuous to work for 1 month after return [21]. By knowing the negotiation advantage position, employers had improved their BATNA through longer negotiation time and turn worker’s “FIXED” desire (low BATNA) became less bargaining chips and at the end had to compromise and accept 9.8% salary increase[22]. The disadvantage of making the negotiation period too long will be growing fatigue to both negotiators and will introducing more issues that are not raised originally on the table; and even not reaching any outcomes.

Conclusion

Nowadays in labour negotiation especially in Hong Kong, the negotiation will be involved political parties. This trend is rising because there were lots of political views discrepancies in Hong Kong and there are very fierce opposition for Anti-China and Government parties to the Pro-Government parties and Hong Kong Government. Therefore the Anti-Government parties are finding holes and gaps where related and to get involve and then to oppose the government. These parties were kept trying to get more political bargaining chips for gaining supports, votes and agreement from the public. This is why the sub-trends and even the sub-strategy within labour negotiation are always political and what ever happened, the attention will be interfered by Anti-Government parties and transfer to government’s incompetence. As such, the Docker’s labour strike 2013’s attention were transferred to “Hatred of rich”, “Government incompetence”, “Raised of British Flag”..etc.

Reference

[1] http://en.wikipedia.org/wiki/Negotiation

[2] http://en.wikipedia.org/wiki/2013_Hong_Kong_dock_strike

[3] http://en.wikipedia.org/wiki/Hongkong_International_Terminals_Ltd.

[4] Wang, Jasmine (19 April 2013). "Li Ka-Shing’s Striking Port Workers Lose Jobs as Protest Widens". Bloomberg BusinessWeek

[5] Hong Kong Confederation of Trade union, http://www.hkctu.org.hk/cms/index.jsp

[6] Labour Party www.labour.org.hk

[7] http://thehousenews.com/society/工會代表見勞工處 堅持工會身份談判

[8] Cargonews Asia http://www.cargonewsasia.com/secured/article.aspx?article=30697

[9] Ming Pao Newspaper http://specials.mingpao.com/cfm/News.cfm?SpecialsID=273&Page=1&News=8eea00ed15534065cebc22e736194103bfbe00473c90410ba3ee0ac8

[10] We Love Hong Kong news journal http://www.welovehk.org/2013/09/香港貨櫃碼頭工人罷工事件的啟示

[11] Apple Daily http://en.wikipedia.org/wiki/Apple_Daily

[12] Ming Pao Newspaper 2013-05-01 http://archive.today/20130630173527/hk.news.yahoo.com/馬德富-葵青港的烽煙-212243430.html

[13] Sing Tao Daily https://hk.news.yahoo.com/霍建寧批工會文革式抹黑-220304376.html

[14] http://thehousenews.com/society/碼頭工人接受加薪-結束40天罷工/

[15] Leigh L. Thompson: The Mind and Heart of the negotiator (2009) page 74-75

[16] Danny Ertel: Turning Negotiation into a corporate capability(1999), page 64

[17] Kandarp Mehta: The power of creative comebacks; Five Essential Strategies for Creative Negotiations (2012, issue 15), page 52

[18] Leigh L. Thompson: The Mind and Heart of the negotiator (2009) page 76-77

[19] Leigh L. Thompson: The Mind and Heart of the negotiator (2009) page 85-87

[20] Dr. David Venter: Negotiation BANTA, http://www.negotiationtraining.com.au/articles/next-best-option/

[21] http://thehousenews.com/society/hit利誘復工-明天開工獎2000元

[22] Workers acceptance of final offer http://news.now.com/home/local/player?newsId=67158

Assignment 1: To Trust or to Distrust

It was an unpleasant experience happened to me in 2012, at that time; I was a section in charge in department of design in my company that I served for. The works we basically faced daily as whole is to handle all sorts of design and coordination roles to new stores and renovate current stores; it also involves many of decision making. The process of which will required frequently access and analysis business data, then to suggest proposals to managing director & relevant stakeholders. In a nutshell, it is a real complex and diversify job; and “Stress” is one of the most frequent word in our bible.

In Quarter 3 of the year 2012, I was handling a 30,000sqft. store (about X10 tennis courts size). It was a flagship store for our newly developed store concept in Hong Kong Region; everything went very well as expected throughout the whole project. However, on the other hand, what was missing was a junior replacement role in my team where remained vacant for some time back in 2012. Our team was desperate for this replacement role to handle some of the extra works to cope with rapid expansion of our business.  

While I was struggling about filling this place, I had a “friend-ish” person contacted me for Chit chat; and this guy (I would called him “X” below) was finding a new job and was telling me all the harassments and difficulties he was encountering at his place. Sharing the background of “X”, I knew this guy from a night school a few years ago, “X” seems to be an honest guy, willing to learn, but not achieving much at his career; he is a bit younger than me with less strong in academic background. So “X” was asking if there is any opportunity to work at the role that we had offered. As a manager, I know very well about how difficult of managing a “Friend” is, especially I knew this guy in advance.

Before my decision was made, I weigh about the pros and cons of having a “Friend” in the business, advantage if this would means “X” would dedicated to help me and discussion can be easily carried out through our trust , but the disadvantage is more difficult for me to manage as “X” may not treat my indication seriously because of our relationship; other study have also shown that embedded relationship have advantage of initiating self-organizing arrangement through trust[1] but also pitfalls of this relationship gets emotional[2]. But because the point in time, we were urge to get a replacement and recalling to my impression about “X” being a guy whose willing to learn and kind of honest; I didn’t take too much time to consider deeply about accepting him to join our company.

Under my recommendation, “X” had joined our company, and work as a junior role. Very soon after he join, I realized 1+1 ≠2, in fact he had created more holes for me to fill. Although “X” seems willing to learn, but he is having difficulties of understanding instructions an DO talk back when he hasn’t done thing correctly; my comment of him is a “Role Model” for others NOT TO FOLLOW, cause he blame everything he has done wrong and make excuses to whatever mistakes he had created. Then I started to realize I shouldn’t made that decision even I had already highlighted the risk of it. Perhaps I was too trusted in him for the impression he had shown me. “X” perform badly but I was trying to turn the situation around by showing more concerns about him in order to improve his commitment; the material have also give example about “Benevolent of concern” and how this can regain trust when trust factor is challenging between employee[3]. Because of that, I had allow him to leave half-an-hour early as “X” claimed that he had unforeseen incident from his family on a random date.

The nightmare came soon after my benevolent, he have shown me a letter, a white envelope. i have found out that he used my benevolent to go interview for a different job. He lied to me. He had also used the reputation of our company to jump to other job.(the company i am working for is the market leader in this industry ) I knew straight away of his next word but I was very calm, and had a very good lesson about what could happen if wrong decision is made. I blamed myself for letting this happen even knowing the risk and the uncertainty about “X”; just because I was needing a replacement, it does not mean I could risk this, yet, the decision had been made differently.

I realized I would probably need some Aloe Vera, cause I’ve got burned….

Anyway, after the “X” incident, I’ve learnt to make decision more carefully even there are burning needs to whatever issue I am encountering. Weighing the pros and cons more seriously and questioning myself on what the worst could happen if the decision were made.

[1] Thompson,L.L.(2009).The Mind and Heart of the Negotiator. (4th ed.). Prentice Hall (NJ).

Chapter 6, Establishing Trust and Building a Relationship, page 155

[2] Thompson,L.L.(2009).The Mind and Heart of the Negotiator. (4th ed.). Prentice Hall (NJ).

Chapter 6, Establishing Trust and Building a Relationship, page 155

[3] Hurley, R.F. (2006). The Decision to Trust. Hardvard Business Review, 84(9), page 55-62.