economic and political factors in formal grievance resolution

Economic and Political Factors in Formal Grievance Resolution

DAVID MEYER and WILLIAM COOKE*

The resolution of formal grievances is largely determined by the applicable rights of grievants and the facts surrounding disputes. However, to the extent these rights andlor facts are unclear, the granting or denial of grievances is also partially determined by economic and political factors. A model of the impact of such factors on the favorability of grievance decisions is developed and tested. The tests yield support for the general thesis and for several specific hypotheses.

THIS PAPER DEVELOPS AND TESTS a general behavioral model of the determinants of the favorability (from the grievant’s perspective) of the outcomes of formal grievance procedures.’ The basic thesis is that when applicable rights andlor facts of the grievance are unclear to the parties, favorability of the grievance resolution is determined by management’s production needs, workers’ economic and political influence, and local union political factors. This study is the first published research that models and tests the impact of these economic and political factors on grievance resolution .2 Our empirical results provide some support for the general model as well as for our specific hypotheses.

* The authors’ affiliations are, respectively, College of Commerce and Industry, University of Wyoming, and School of Business Administration, University of Michigan.

’We thank Jack Fiorito, Dallas Jones, Richard Peterson, Ted St. Antoine, and three anonymous referees for many constructive comments.

*Nearly all published empirical investigations of grievances have attempted to explain the incidence of grievance filing. See, for example, Ash (1970); Dalton and Todor (1979, 1982); Munchinsky and Maassarani (1980); Price et al. (1976); and Ichniowski (1986). The arbitration literature is devoid of empirical modeling and tests of rightr arbitration outcomes. Furthermore, the literature largely examines the factors that arbitrators weigh in rendering their decisions (see Elkouri and Elkouri, 1985). These factors do not include the economic and political elements examined here.

INDUSTRIAL RELATIONS, Vol. 27, No. 3 (Fall 1988). 0 1988 Regents of the University of California 0019/8676/88/1020/3 18/$10.00

318

Factors in Formal Grievance Resolution I 319

Resolving Workplace Problems: Alternative Channels

Many problems that arise at the workplace do not, of course, become formal grievances (see Meyer, 1987). Some problems are not grievable; others are too minor to be pursued formally. In other cases, problems are resolved informally by direct worker action (e.g., wildcat strikes and working- to-rules); by direct accommodation between workers and supervisors (e.g. , by bending work rules and working out of classification); or by informal negotiations between the union leadership and management (for a detailed discussion of these alternatives, see Kuhn [1961] and Sayles and Strauss [ 19531). Generally, the parties choose these informal channels over the formal grievance procedure whenever the informal means are perceived as likely to yield greater net benefits of resolution.

The parties also sometimes utilize the formal grievance procedure to achieve goals unrelated to resolving individual worker’s grievances (see Kuhn, 1961; Sayles and Strauss, 1953; Slichter et al., 1960). For example, the union may attempt to flood the grievance procedure just prior to union officer elections and/or contract negotiations; management may file grievances against the union; and the union may file grievances against management for making changes in policy and procedures. Some of these grievances also involve issues over which it is contractually permissible to strike. Accordingly, negotiations to resolve these cases may include the threat or use of a strike. For the purposes of this study, the use of formal grievance procedures in the instances outlined above is considered exceptional, and we exclude these forms of grievance^.^ Finally, some formal grievances are resolved by arbitration. Since the behavioral factors that we hypothesize as influencing the resolution of grievances are not expected to play key roles in determining arbitral outcomes, we restrict our analysis to cases resolved prior to arbitration.

The Role of Rights and Facts in Grievance Resolution

In resolving grievances, the parties are obligated to base decisions on the merits of the case, as determined by the interpretation of rights and facts

3Approximdtely 7,500 grievance records settled short of arbitration were filed during the period studied. Here we utilize about 900 records (N=911). Those types of grievances that involved strikeable issues under the contracts (N=1,027) (e.g., health and safety) and those which we could not readily match to contract articles (explained below) were excluded. We also excluded discipline and discharge grievances (N= 1,046) since the rights governing these types of grievances in our sample were largely derived from precedents and past practices about which we had no information. In addition, we exclude cases if data were missing on any of the independent variables.

320 / DAVID MEYER AND WILLIAM C O K E

surrounding grievances. The rights of managers and workers are derived from contractual agreements, past practices, and any precedents arising from informally negotiated agreements, previous grievance settlements, and arbitration awards (Summers, 1985). In deciding the merits of grievances based primarily on rights, the parties must address three key questions. Do the circumstances allow or prohibit management action? Were the appropriate criteria applied? Was the procedure used an appropriate one? If the answer to each of these questions is a clear yes (no), then the grievance would be denied (granted). In cases where the answers are ambiguous, other factors-specifically those associated with production needs, workplace and worker characteristics, and union politics-also influence the outcome.

As Summers (1985) notes, the outcomes of some grievances hinge primarily on disputes over the facts surrounding grievances, not over the clarity of the rights per se. Because the parties are in dispute over what actually occurred and/or where fault is to be placed, each must investigate and then decide whether or not it wants to pursue or challenge the grievance.

The distinction between disputes over rights and those over facts is clearer in theory than in practice. Among empirical cases, the two types of grievances are likely to overlap considerably. As complexity of the circumstances surrounding certain types of grievances increases, the parties are more likely to have disputes over the facts. In these types of grievances, it is also often difficult for the parties to clearly delineate the circumstances that would call for management action and to establish the criteria and steps for that action. Hence in cases in which the rights are unclear, disputes over facts are also common. In contrast, where the parties’ rights can be clearly established, there typically is much less room for factual disputes.

Behavioral Assumptions Our general theoretical assumptions about the behavior of management,

workers, and union leaders necessarily oversimplify the parties’ motivations. Overall, however, they are reasonably accurate abstractions of behavior that provide a useful guide for developing specific hypotheses about the parties’ decision making regarding grievances.

Management. We assume that management generally seeks to maximize profits and thus to minimize production costs. We assume that overall labor costs are a function of (a) the price of labor in wages and benefits, and (b) the price of maintaining control over the workflow and the pace of work, and stable workplace relationships. As the demand for production output varies over time, management makes cost-minimizing tradeoffs between (a) and (b). For example, as management increases the level of production,


workers may in turn cause disruptions in the workflow, pace, and/ or workplace relationships, thus inflicting greater production costs on management. Therefore, in cases where favorable grievance outcomes can be expected to reduce the potential for workplace disruptions (and thus minimize production costs), management can be expected to act in the grievant’s favor (see Ichniowski [1986] and Brett and Goldberg [1979] for details). Management’s concerns about consistency and predictability in contract administration do, however, restrict the effect of economic interests on grievance outcomes.

Union leaders. We assume that union leaders seek to maximize their utility, which is accomplished by maximizing (a) the perceived welfare of most bargaining unit employees, (b) personal political power within the union, and (c) the well-being and security of the union as an institution. In the context of problem resolution, union leaders attempt to achieve (a) by expanding and enforcing contractual, precedential, and past practice rights; providing due process in problem resolution; and ensuring fair and equitable treatment of workers. They attempt to achieve (b) by utilizing the various problem resolution channels to bolster their image as the more effective representatives among alternative candidates within the union. And to achieve (c), union leaders seek more favorable grievance outcomes the greater the severity and scope of grievances, the more valued the grievants to the union, and the less internal union dissension caused by the grievances.

Workers. We assume that workers seek to maximize utility from the employment relationship. They attempt to (a) enforce perceived rights gained from previous contract negotiations, past practices, and precedents; (b) minimize mancgement’s control over their work-related behavior; and (c) pursue their interests via formal and informal negotiations during the life of a contract and upon contract renewal. Within the formal grievance procedure, the enforcement of perceived rights and minimization of management control of worker behavior is a function of worker economic power (which stems from workplace characteristics and production demands), and the relative political power of workers within the union.

Hypotheses Our hypotheses are formulated to allow the specification of reduced form

model^.^ To facilitate the model specifications that follow, the names of the variables used to model the hypotheses are given in parentheses. The

4To specify the full set of simultaneous equations that underlie the interaction of managers, union leaders, and workers would require a far richer data set than the one we were able to compile.

322 / DAVID MEYER AND WILLIAM COOKE

variables themselves are defined in Table 1.

Management. Given the assumptions of managerial behavior as influenced by product market conditions, it follows that the greater the costs to management in granting grievances, the more resistant management becomes. Therefore, it is hypothesized that the greater the number of workers directly and immediately affected by the outcome of a given grievance, the more resistant management is to granting favorable grievance outcomes and, hence, the less favorable are grievance outcomes. (SCOPE)

As the union has a greater opportunity to satisfy a larger number of members in the resolution of any one grievance, it has greater reason to aggressively pursue favorable outcomes. Consequently, the hypothesized negative relationship between the scope of grievances and the favorability of outcomes is offset to the extent that union leaders become more aggressive in their efforts to obtain favorable outcomes as the immediate impact of any given grievance increases.

Secondly, as the demand for production rises, worker economic power increases and management, in turn, is more inclined to grant grievances to offset the potential use of increased worker power. As such, it can be hypothesized that the greater the relative level of production during the period grievances are resolved, the more likely the grievance outcome will be favorable to the grievants. (TPROD)

Workers. The economic and political power of workers is directly affected by workplace characteristics.' As a result of workflow design and the division of labor, certain job classifications are associated with greater economic power to disrupt workflow, pace, and stable work relationships. Greater economic power, in turn, increases worker political power within the union as the union leadership seeks to maximize the overall bargaining strength of the union as an institution. It can be hypothesized that more-skilled workers have greater economic and union political power than less-skilled workers and hence are more likely to obtain favorable grievance outcomes. (SKILL)

Although ideally we would want to examine the impact of other workplace- related factors on favorability, appropriate data are not available. To control as much as possible for other unobserved workplace characteristics, the plants at which grievances arose are held constant in our empirical tests. (TRIM, TRUCK, HP)

The effects of workplace characteristics on grievance initiation have been studied by Peach and Livernash (1974). The effects of workplace characteristics on grievance resolution has received little or no empirical study, however.


TABLE 1

INDEPENDENT VARIABLE DEFINITIONS

Variable Definition

SCOPE

TPROD

=

=

number of grievants who are part of a single grievance (1 to 4 or more).

number of vehicles produced in the month a grievance is resolved divided by the moving monthly average of the number of vehicles produced during the 12-month period surrounding the month the grievance is resolved.=

1 when the month during which grievance is resolved is a month during which a model changeover is underway, 0 otherwise.

1 if the grievant's job classification is in the skilled trades group, 0 otherwise.

1 if grievance resolved in the automobile trim plant, 0 otherwise.

1 if grievance resolved in the panel truck plant, 0 otherwise.

1 if grievance resolved within the work unit that services all Highland Park facilities, 0 otherwise.

CHNGOVER

SKILL

'TRIM

TRUCK

HP

=

=

=

=

=

(The omitted benchmark category for TRIM, TRUCK, and HP is the tractor plant.)

NVOTES = total number of bargaining unit employees voting in the election of the committeeperson representing the grievant(s).

MANDATE number of votes for committeeperson representing the grievant(s) divided by NVOTES (x 100).

natural log of the number of months preceding the next election of committeeperson.

number of grievances filed in the month a grievance is resolved divided by the monthly moving average of the total number of grievances in the 12-month period surrounding the month the grievance is resolved.

1 when a grievant protests some benefit gained by another worker or work group at the grievant's perceived expense, 0 otherwise.

=

MBELECT =

DNGROVE =

I'ROTEE =

d'l'hese data were drawn from various issues of Wards (Wards Communications, Inc., Detroit) and Implemenr and Tractor (Interec Publishing Corp., Kansas City).

Work by Ash (1970), Price et al. (1976), and others on the effects of worker characteristics on grievance initiation leads us to believe that certain worker characteristics may be associated with the favorability of grievance outcomes as well. Traits associated with increased economic power, greater political influence in the union, or better personal negotiation and problem- solving skills are likely to enhance an individual's prospects in obtaining favorable grievance outcomes. Unfortunately, our data source does not provide information on the personal characteristics of the grievants. Whether


or not this leads to omitted variable problems in our model specification is difficult to ascertain. Our estimates of the impact of skill level on favorability may be biased in that skill level may capture the effect of some personal characteristics on the favorability of grievance outcomes.

Unions. Union representatives handling grievances vary in their abilities to obtain favorable outcomes. This variability depends in part on the extent to which managers respond more favorably to the demands of union representatives with greater economic and/or union political power. That is, the greater the economic power of a work group and/or the greater the support of a work group for their union representative, the greater the potential costs of production-related disruptions that can be marshalled by that representative. Hence, a union representative’s economic and political power is greater, the larger and more skilled the work unit he/she represents and the greater the unanimity of support he/she receives from the work unit.

Drawing on these propositions and noting that the union representatives in our sample were elected by district and not on an at-large basis, we make the following hypotheses: ( I ) The larger the size of the election district represented by a union representative and/or (2 ) the larger the proportion of the election district that voted for an elected union representative, the greater the likelihood that grievances handled by that representative will result in favorable outcomes. (NVOTES and MANDATE, respectively)

We cannot control for the problem-solving and negotiation skills of union representatives, so the test of the latter hypothesis may capture differences in these skills (at least to the extent that such skills are valued by workers and are thus correlated with the outcome of union elections).

Union representatives also pursue favorable grievance outcomes more aggressively under circumstances in which they perceive that such outcomes may enhance their personal political power and/or the well-being of the union as an institution. This general proposition yields several testable hypotheses. First, we can expect that as union elections approach, union representatives will work more aggressively to obtain favorable grievance outcomes, which increases the likelihood of favorable grievance outcomes. (MBELEC)

Second, to bolster their image of concern for the workers’ welfare and their willingness to challenge management, union representatives may also flood the grievance procedure as elections approach (Slichter et al., 1960). The filing of less winnable and/or less well-prepared cases reduces the likelihood that favorable grievance outcomes will be obtained. Although we control for the rate of grievances filed during the period a given grievance is being filed and resolved (DNGRVE), we are not able to effectively control

Factors in Formal Grievance Resolution 1 325

for those grievances that result from flooding.6 Consequently, the estimates of the impact of approaching elections on favorability are likely to be downwardly biased.

Third, when grievances arise from management actions that result in decisions adversely affecting some employees over other employees (e.g., through overtime allocation or layoff selection), union representatives typically find themselves in no-win positions-what some employees gain, other employees lose. Hence, where favorable grievance outcomes for some employees result in losses for other employees, union representatives are less likely to aggressively pursue favorable outcomes, thus reducing the likelihood of obtaining favorable grievance outcomes. (PROTEE)

Sample and Method The sample of formal grievance resolutions that we examine does not

represent a random distribution of all workplace problems. As noted earlier, we exclude grievances that are resolved informally; those that are resolved by arbitration; and those that involve either management and union grievances against one another or grievances over strikeable issues under the contract. These exclusions introduce potential (and probable) selectivity bias. To the extent that the selection of grievances or problems resolved in formal and informal channels differs and to the extent that the impact of economic and political factors on the favorability of resolution likewise differs, we either over- or underestimate the true impact of the variables in our models. Because of data limitations, we are unable to examine the direction or magnitude of these potential biases. Two-tailed significance tests are used, however, given that sample selection may bias not only the magnitude but also the direction of any estimates.

Data. We found employers and unions reluctant to share information that might show that the favorability of formal grievance decisions depends in part on factors other than the meritorious interpretation of rights and facts. Our efforts to obtain current data were unsuccessful. We rely on formal grievance records donated by Ford-UAW Local 400 in Highland Park,

bFlooding can also occur just prior to or during contract negotiations and strikes. In the present setting, however, there are insufficient observations to assess such flooding behavior and its effect on formal grievance resolutions. There were only two rounds of negotiations (1955 and 1958) and there were only three strikes, all wildcat strikes. Moreover, there are no increases in formal grievance rates surrounding these events, although there may have been increased informal grievance resolutions and increased “pocketing” of potential formal grievances to be used as bargaining chips. As a check on the results presented in Table 2, we entered variables measuring months prior to negotiations and strikes (following the functional form specified for MBELEC) into the equations. As expected, the estimates on these variables were inconsequential and insignificant, and they did not modify the results reported in Table 2.


Michigan to the Walter P. Reuther Memorial Library archives. Because of UAW concerns over the confidentiality of more recent records, access to records was restricted to the 1949 to 1959 period. Although these data are less than ideal and are dated, they do allow at least preliminary tests of our hypotheses.

We believe that our theoretical propositions are generalizable over time, but the parameter estimates made against this 1949 to 1959 data set obviously are less generalizable. For instance, the increasing constraints of the “duty of fair representation” imposed on unions in the post-1960 period can be expected to have altered union behavior (McKelvey, 1985). Also, to the extent that rights under contracts have become more formalized andior more extensive over the last 25 years, the impact of certain product market and union political factors on the favorability of grievance outcomes has been reduced.

Controlling for clarity of rights and facts. To operationalize and test the basic proposition about clarity of rights and facts, we first partition observations into subsamples of grievances associated with rights and facts of “high clarity” and rights and facts of “low clarity.” Support for our proposition about the clarity of rights and facts would be found if the independent variables have more impact on favorability when the model is estimated against the subsample of low clarity of rights and facts grievances than when it is estimated against the subsample of high clarity of rights and facts grievances.

The criteria used for partitioning the sample are based on the articles and sections of the appropriate contracts cited on the grievance records. We placed into our high clarity of rights and facts subsample those grievances that fell under contract articles and sections that clearly stated (a) the circumstances under which management could act, (b) the criteria, and (c) the procedural steps. We placed into our low clarity of rights subsample those grievances that fell under contract articles and sections in which the circumstances, the criteria, or the procedural steps were silent or unclear. The categories of grievances included in the high clarity of rights and facts subsample are: improper layoff or recall; protested overtime; bumping; short pay; holiday pay; call-in pay; vacation pay; and seniority-related adjustment or violation. The categories of grievances included in the low clarity of rights and facts subsample are: promotion; improper assignment or loan of employee; working out of classification; supervisor or nonmember working; and supervisory intimidation and improper ~upervision.~

’We excluded ambiguous grievances, including those for which the records either (a) had no identification of contract article and section; (b) listed multiple contract articles and sections; or (c) listed articles and sections that strongly suggested misapplication. As a final means of reducing ambiguity regarding clarity, when a contract article was modified during the period of study, we dropped all grievances associated with that article.


A tighter set of criteria would also account for rights not embodied in the contract, but such data are not available. Additionally, we have no way of controlling for clarity of facts per se. However, as discussed earlier, we anticipate that there is a high correlation between clarity of rights and clarity of facts. Although use of the above criteria for partitioning the sample is incomplete, it is the most objective approach we could construct given available information. We recognize that other researchers might partition the grievances differently. Descriptive statistics for each subsample are presented in Table 2.

A Model of Grievance Resolution Favorability The model below is estimated for both the high clarity and low clarity of

rights and facts subsamples. Discussion of the estimators and operationaliz- ation of the variables follows.*

FAVOR, = a, + b,SCOPEi + b,TPROD, + b,CHNGOVR, + b4SKILLi

+ bSTRIMj + b6TRUCKj + b,HPj + b8NVOTESk

+ b9MANDATEk + bloMBELEC, + bllDNGRVE,

+ bJ’ROTEEi

where i = the grievance, j = the plant, k = the union representative, and m = all plants.

The grievances in our sample were resolved at steps 1, 2, and 3 of the Ford-UAW grievance procedure. The outcome classifications recorded by the parties are: “granted,” “partially granted,” and “denied.”’ The partial granting of grievances seems to have occurred in cases where there was room

8Because of limitations on the number of observations available to estimate the models, data are pooled over the 1949 through 1959 period. Pooling raises the possibility of serious omitted variable effects. Ideally, we should allow for differences in behavior across the cross-sectional units ( ix. , the parties of the grievances) at any point in time and for any differences in behavior over time (1949 through 1959) for a given cross-sectional unit. However, the observations in our sample do not track the same cross- sectional units over time. Thus, two standard correction methods-least squares dummy variable (LSDV) techniques and the use of an error components model-are precluded. As a sensitivity check on the reported estimations, we estimated the models with the inclusion of yearly dummy variables. Except for relatively minor differences in fit and magnitude of the estimates reported in Table 2, the inclusion of yearly dummy variables across the full set of equations largely alters the statistical fit of MBELEC and MANDATE, reducing each to insignificance. The results of the estimations with yearly dummy variables included are available from the authors upon request.

yGrievances with the other possible outcomes, withdrawn and closed out, are excluded from analysis because the degree of and reason for favorability is unknown. Closing out a grievance occurred when the point of contention became moot (the grievant quit, was discharged for a more serious offense, or another grievance concerning the same issue was resolved, which established a controlling precedent). Withdrawing a grievance occurred when the parties agreed there was a procedural violation in handling the grievance, that no precedent would be established, and when either party conceded the contested issue.


TABLE 2 DESCRIPTIVE STATISTICS

High Clarity Grievances Low Clarity Grievances

Proportion Standard Proportion Standard Variable or mean deviation Range or mean deviation Range

FAVOR SCOPE TPROD CHNGOVR SKILL TRIM TRUCK HP NVOTES MANDATE MBELEC DNGRVE PROTEE

,591 1.178

94.533 .123 .161 .223 .195 .478

512.805 53.733 2.317 8.402

.758

.454

.633 22.462 -

-

279.163 12.979

.770 2.261 -

0,192 1,2,3,4+

0 or 1 0 or 1 0 or 1 0 or 1 0 or 1

11.09-143.99

93 - 1,12 1 23.7-99.8

0-3.18 2.3-16.4

0 or 1

.493 1.147

99.941 .060 .204 .175 .199 .455

431.534 53.828 2.293 8.375

.451

.431

.527 21.867 -

- 218.705

13.311 ,724

2.403 -

0,1,2 1,2,3,4+

27.15- 147.04 0 or 1 0 or 1 0 or 1 0 or 1 0 or 1

93-1,121 23.7 -99.8

0-3.18 2.3-16.4

0 or 1

for concessions either because there was no precedent, because precedent implied a reduction in the severity of the effect on or cost to the grievant, or because the appropriate remedy was only approximated by the grievant. Types of grievances for which this occurred include those involving protested overtime, improper layoff, and a nonmember or supervisor doing bargaining unit work.’*

The granted, partially granted, and denied classifications yield a fairly clear sense of order regarding favorability, but this scheme does not produce an accurate picture of the degree or level of favorability. In particular, the set of partially granted grievances presents a conceptual and measurement dilemma because the records do not indicate how much of the original grievance was granted. In effect, the outcome of partially granted grievances is unobserved.

Given this dilemma, there are two ways to model favorability, each presenting its own conceptual and measurement problems. First, favorability could be viewed as an “either-or” outcome; either the grievant obtained some adjustment or no adjustment. Partially granted and fully granted grievances would be included in the same category and compared to the denied grievance category. To the extent that some grievances are initially written to request more than the grievant reasonably expects because union representatives anticipate some negotiation and compromise over the outcome,

‘“N=33 of 143 protested overtime grievances; N = 3 4 of 150 improper layoff grievances; and N-99 of 155 nonmember or supervisor working grievances.


this combined category would enhance the accuracy of our measure of favorability. To assess how much of a difference this approach makes in testing our hypotheses, we also estimate the model excluding all partially granted grievances. The more similar the two sets of estimates, the more appealing this approach (and vice versa).

The second method is to estimate the model using an ordered probability estimator, such as ordered logit. Here we must first assume that granted grievances are more favorable than partially granted grievances and that both granted and partially granted grievances are more favorable than denied grievances. Second, however, we must assume that there may be overlap among all three categories. That is, some partially granted grievances are equivalent to some denied grievances, and some partially granted grievances are equivalent to some granted grievances. Moreover, it must be assumed that some denied grievances may be equivalent to some granted grievances, and vice versa. This latter assumption, of course, is conceptually awkward given the present outcome classifications.

Although estimating the model of favorability by either method is less than ideal, by comparing the results of the two estimators, we should be able to draw some reasonable inferences about our hypotheses. In the first model, we use a logit estimator, where the dependent variable FAVOR equals 0 when the grievance is denied and equals 1 when granted or partially granted. In the ordered probability model, FAVOR equals 0 when the grievance is denied, equals 1 when partially granted, and equals 2 when granted.

Variables. Several of the independent variables (defined in Table 1) require additional explanation. Note that SCOPE ranges from one to four or more. When there were more than four grievants filing the same grievance, a grievance record typically reported only that “more” grievants were involved. (Fortunately, only 4 per cent of the grievances in the sample have four or more co-signers, causing fairly modest measurement error .) Second, our measure of production activity, TPROD, is constructed to allow us, in effect, to compare apples and oranges, as each plant produces a different vehicle or vehicle product.” Since there may be unaccounted for problem-

‘ 1 Measurement error, however, is unavoidable. As the Ford automobile trim plant (TRIM) produced every interior used in Ford automobiles during the period studied, we use the number of Ford automobiles produced (lagged one month) in calculating TPROD for the trim plant. Measuring production levels for the other facilities is more problematic, because available data sources about production are more aggregated. As an index for production in the Ford panel truck facility (TRUCK), we utilize Ford figures on the number of all Ford trucks produced. These are aggregate production figures that include panel, pickup, over-the-road trucks, and truck chassis. i n constructing TPROD for the Highland Park manufacturing complex as a whole (HP), figures for total car production for all Ford, Lincoln-Mercury, and Edsel (when produced) automobiles are utilized. These aggregate figures are also lagged one month. Finally, in measuring TPROD for the Ford tractor facility (which is the benchmark unit for estimates on TRIM, TRUCK, and HP), we utilize industry-wide production figures for the number of all tractors produced.


handling behavior occurring during model changeover periods which may bias estimates on TPROD, the variable CHNGOVR is added as a control variable. Lastly, the natural log of months is selected as the appropriate functional form of MBELEC because more aggressive handling of grievances is more likely to occur during the few months prior to committeeperson elections. That is, we would not expect to see a linear relationship over the typical 12- or 24-month period between elections but, instead, a concave upward relationship between MBELEC and FAVOR.

Results Table 3 presents the logit and ordered logit estimations for each subsample

of grievances. Tests of differences between coefficients within each set of estimates are also reported. Interpreted with caution, the estimations are revealing.

The estimates are fairly consistent with respect to sign and fit across the logit and ordered logit estimations.” The exceptions are TPROD and MBELEC, which are significant in the logit estimations but not in the ordered logit estimations, and MANDATE, which is significant in the ordered logit estimations but not in the logit estimations. Hence, choice of estimators makes some difference in drawing inferences about specific hypotheses. Overall however, robustness is relatively high in spite of the estimator employed. When the partially granted grievances are excluded from the logit estimation, there are no perceptible differences from the estimations presented in Table 3. Therefore, it appears that treating partially and fully granted grievances as a single category does not bias the inferences drawn from the logit estimations.

The impact of the independent variables on the favorability of the resolution outcomes differs as rights and facts become more or less clear to the parties. Excluding the control variables (CHNGOVR, TRIM, TRUCK, HP, and DNGRVE), in the high clarity of rights and facts subsample only SCOPE is highly significant in both equations. TPROD is significant at the d .05 level; NVOTES and MANDATE are significant at the G .10 level in only one equation. In the low clarity subsample, in both equations, SCOPE, NVOTES, and PROTEE reach significance at the < .05 or G .01 levels, and SKILL reaches significance at the d .05 or S .10 levels. MANDATE and MBELEC obtain significance at the S .01 level in one of the two equations. Furthermore, there are significant differences at the d

IZ Interpreted more precisely, a negative (positive) sign in our three-category ordered logit estimations indicates that an increase in a given exogenous variable decreases (increases) the probability of having a grievance fully granted and increases (decreases) the probability of having a grievance denied. The probability of having a grievance partially granted could either increase or decrease.


TABLE 3

(STANDARD ERRORS IN PARENTHESES) LOCIT AND ORDERED LOGIT ESTIMATIONS AND EQUATION COMPARISONS

Logit Ordered Logit Coefficient Coefficient

High clarity Low clarity comparisons" High clarity Low clarity comparisons" Variable coef. coef. (t-scores) coef. coef. (t-scores)

SCOPE

TPROD

CHNGOVR

SKILL

TRIM

TRUCK

HP

NVOTES

MANDATE

MBELEC

DNGRVE

PROTEE

INTERCEPT

P(1)

-.889*** -.862*** (.185) (.271)

-.011** +.m (.005) (.006)

+1.213*** -.255 (.468) (.542)

(.281) (.320) +1.974*** +.470

(.455) (.472)

(.384) (.395) +.799** p.107

(.342) (.340) +.0009* +.003*** (.0005) (.OMS)

+.009 +.014 (.009) (.009)

+.139 +.481*** (.144) (.173)

(.048) (.051)

(.246) (.249)

(.954) (1.137)

p.058 +.563"

-.332 -.588

+.050 -.129**

+.230 -.985***

+.209 -.276

0.083

1.955%

1.737*

1.458

2.293**

0.465

2.141*'

1.789*

0.341

1.519

2.569**

3.472' * *

0.327

- .861*** -.919*** (.165) (.252) - ,005 + ,005 (.OM) (.005)

+ 1.05 1 ** * -.144 (.345) (.529)

+.I77 +.553** (.238) (.273)

+1.728*** +.453 (. 397) (.3W

-.373 - .660* * (. 342) (.330)

+.947*** -.121 (.305) (.281) +.0005 +.002*** (.0005) (.0006)

+.012" +.023*** (.007) (.008)

+ ,002 +.219 (.136) (.137)

(.041) (.041)

(.216) (.209)

(.822) (.975) + .755*** 1.242**'

(.084) (.117)

-- .004 - .098* *

+ .239 -.501**

+.310 - ,362

0.192

1.594

1.891*

1.040

2.360* *

0.606

2.574**

1.792*

0.936

1.127

1.613

2.460**

0.527

3.382***

N 529 382 xz (12d.f.) 123.27 78.46 (-2) x log-likelihood 427.74

ratio 552.44

529 382 126.16 72.90 918.90 756.48

* * * Significant at the .01 level or better; **significant at the .OS level or better; * significant at the .I0 level or better.

Calculated as BH - * '~ T,"2 + q 2 '

See Bloch and Kuskin (1978), footnote 7

.10 level among the coefficients for TPROD, CHNGOVR, TRIM, HI', NVOTES, DNGRVE, and PROTEE between the high and low clarity of rights equations. Note also that the estimates of SKILL, NVOTES, MANDATE, MBELEC, and PROTEE are generally much larger in the


low clarity than in the high clarity subsamples. Overall, the evidence supports the proposition that as rights and facts

become less clear, behavioral factors have a greater impact on the favorability of the outcome of formal grievances. A key exception is that management’s economic considerations in resolving grievances seem to be as important when the clarity of rights and facts is relatively high as when this clarity is relatively low.

Results of speciJic hypotheses. The evidence strongly supports the hypothesis that as more employees are directly affected by the outcome of a grievance, the less likely it is that the outcome will be favorable to the grievants. The highly significant and relatively large estimates of SCOPE’S impact on FAVOR suggests that management becomes highly resistant to granting grievances as the costs of such resolutions rise. As noted above, this relationship holds regardless of the level of clarity of rights and facts governing grievances.

The estimates on the variable TPROD are positive in the low clarity of rights subsample, as hypothesized, but they fail to reach significance. In contrast, TPROD yields negative signs in the high clarity subsample, obtaining significance at the d .05 level in the logit estimation. One possible explanation for the wrongly predicted negative relationship between TPROD and FAVOR is that although management is more likely to resolve grievances favorably as production needs are greater, these resolutions are likely to be achieved through informal channels. During periods of higher production, only those high clarity of rights grievances that management is unwilling to settle informally get channeled into the formal grievance procedure. Since management is especially reluctant to grant these selected grievances, and because the clarity of rights and facts is relatively high (presumably in management’s favor), workers are less likely to obtain favorable outcomes. The degree of this selection bias is much smaller in the low clarity of rights and facts subsample because management resistance to granting these grievances presumably cannot be backed by clearer rights and facts.

The hypothesis that more-skilled workers are more likely to obtain favorable outcomes than less-skilled workers (SKILL) finds significant support only in the low clarity of rights and facts subsample, implying that workers in skilled occupations have more economic and union political power. Since worker characteristics are not controlled for in the equations, however, the estimates on SKILL may also be picking up the effect of personal characteristics correlated with skill level and influencing FAVOR.

The likelihood of favorable outcomes is substantially higher for grievants who are either employees in the trim plant (TRIM) or employees servicing

Factors in Formal Grievance Resolution / 333

all plants (HP) than for grievants who are employees in the truck (TRUCK) or tractor plants. Apparently, there is some salient factor (or set of factors) not fully captured in our equations that differs across plants and, in turn, affects grievance outcomes.

Estimates of the impact of union political factors on FAVOR are fairly robust in the low clarity of rights and facts subsample but much less so in the high clarity subsample. In the high clarity subsample, only NVOTES in the logit equation and MANDATE in the ordered logit equation obtain significance (at the G .10 level of confidence). The estimates on NVOTES, MANDATE, and PROTEE all obtain significance at the s .05 level in the low clarity subsample in the logit and/or ordered logit equations. The evidence, therefore, supports several hypotheses. First, the larger the size of the work group represented by the committeeperson (NVOTES) and second, the larger the majority of employees supporting the committeeperson (MANDATE), the greater hidher clout and hence the greater the likelihood that grievances will be granted. These inferences find greater support in the low clarity of rights and facts subsample than in the high clarity subsample. Third, when grievants protest against some benefit gained by other employees (PROTEE) and the rights and facts of the grievances are relatively unclear, union representatives have little or nothing to gain from obtaining favorable outcomes and, consequently, favorable outcomes are less likely to be obtained.

The MBELEC estimates do not support the hypothesis that union representatives are more likely to obtain favorable grievance outcomes as elections of representatives approach. However, the simple zero order correlation of -.23 between MBELEC and DNGRVE (the change in the number of grievances filed) and the significant negative estimates for DNGRVE in the low clarity subsample suggest that grievance flooding behavior as elections approach may be confounding the results. As elections approach and flooding occurs, union representatives are handling fewer winnable grievances and thus the likelihood of obtaining favorable grievance outcomes is reduced. Neither proposition can be directly tested with the available data, since it is not possible to control for those grievances that specifically depict flooding behavior.

Conclusions Despite the shortcomings of the available data, the empirical results yield

modest support for our theoretical model. First, the proposition that clarity of rights and facts plays an important limiting role in the resolution of grievances receives general support, although even for grievances with higher relative clarity of rights and facts, economic and political factors can influence


outcomes. Second, the results support more specific hypotheses about the impact of economic considerations, workplace characteristics, and union political factors.

Overall, our conclusions are consistent with a general thesis underlying much of the bargaining, strike, and interest arbitration literature (e.g., see Farber and Katz, 1979; Kaufman, 1981; Ashenfelter and Bloom, 1984). Namely, uncertainty surrounding the resolution of conflicts of interest creates a “contract zone” within which acceptable settlements are ultimately made. The greater the uncertainty, the wider the contract zone. Stated differently, if the parties knew in advance the ultimate outcome of a strike or arbitrated award, they would avoid the costs of a strike, interest arbitration, and, of course, any protracted conflict resolution. This premise applies to grievance resolution, as well. As uncertainty regarding rights and facts becomes greater, the contract zone widens and the influence of economic and political factors on grievance outcomes grows. In addition, wider contract zones lead to more protracted grievance resolution, and then can be expected to generate more disputes.

Why, then, do the parties fail to establish clear language in the contract, and thus avoid dispute resolution after the contract is signed? Writing clear language requires the parties to shift conflict resolution from contract administration to contract negotiations, which simultaneously shifts uncertainty from administration to negotiations. The parties then face the added burden of predicting both the occurrence of a wide range of events and the economic costs and political ramifications associated with these events. In effect, narrowing grievance contract zones widens negotiation contract zones, which in turn increases the likelihood of strikes. One can surmise, therefore, that rational negotiators weigh the anticipated costs associated with protracted negotiations and a greater likelihood of strikes against the anticipated costs of grievance resolution, including arbitration. The parties will shift the costs of uncertainty into whichever arena is perceived as having lower costs. If, then, the parties fail to formulate clear contractual language, this is largely because they implicitly agree that resolving grievances over perceived rights is less costly than negotiating clear rights. Presumably, over time the parties are better able to predict certain recurring disputes and are better able to assess the economic and political ramifications of resolving these disputes via contract administration. The cost of uncertainty is then reduced and the parties will be more inclined to negotiate clearer contractual language.

Our empirical findings provide an initial step toward a better understanding of some of the salient factors determining the favorability of grievance outcomes resolved short of arbitration. If more current data on grievance handling activity become available, the basic propositions developed here


can be tested more rigorously. Future research should examine and evaluate the long-run impact of (1) granting and denying grievances and (2) of clarifying rights and facts on employee, manager, and union representative behavior; on the relationship among employees, managers, and union representatives; and on both company and union performance.

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