Report says labor-management partnerships should focus on cost savings

The Obama administration must confront deep-seated mistrust between labor leaders and managers and focus on measuring results to ensure the success of labor-management partnership councils, according to a new academic report released on Wednesday.

"It makes no sense to establish an engagement program if no provision is made for the necessary training and facilitation," wrote Marick Masters, a professor at Michigan's Wayne State University; Christina Merchant, a professor at the Maxwell School at Syracuse University in New York; and Robert Tobias, director of the Institute for the study of Public Policy Implementation at American University in Washington. "It makes no sense if the participants on engagement teams are not given sufficient time to make the process work. A shoe-string operation will produce shoe-string results."

Though federal employee unions advocated for and praised President Obama's December 2009 executive order re-establishing formal venues for labor and management to work together on agency issues, the report's authors said his administration must work to convince labor leaders that the relationships won't dissolve when a Republican administration takes office.

Tobias said one key to establishing resilient labor-management partnership programs is having them focus on performance improvement, rather than simply on yielding better labor-management relationships. The partnerships that continued during George W. Bush's administration were oriented toward broader agency missions, he added.

"Both sides recognized that the focus on performance allowed the union to be engaged and the management to benefit from that engagement," Tobias said. "We believe if the parties really understand their role and are satisfied with their role, it'll be institutionalized and it won't matter when union leaders change or managers change."

Data must support a focus on performance, the report's authors said. In their review of labor-management partnerships during the Clinton administration, the professors found that while the participants surveyed in each study generally reported positive experiences with the program, very few agencies measured concrete cost-savings or improvements in productivity resulting from the partnerships. A 2001 report from the National Partnership Council found that 40 percent of respondents said their partnerships had a positive impact on cost savings, though they did not report how much money was saved on specific projects. In a 1999 Defense Department study, 38 percent of union respondents and 27 percent of management respondents said productivity improved because of partnerships, but they did not quantify those benefits.

A frequently cited study by consulting firm Booz-Allen Hamilton of the labor-management partnership at the Customs Service concluded that the partnership resulted in $3 million in benefits, producing $1.25 for every $1 invested in the partnership. Data compiled by the Office of Personnel Management in 2000 showed the Social Security Administration reported saving between $7 million and $8 million because of a decline in unfair labor practices filings.

Masters of Wayne State University said cost-benefit analyses of the new partnerships should be relatively simple to perform, because tracking time and travel costs for participants is not difficult, and the 1993 Government Performance and Results Act requirements give agencies a framework for deciding which performance elements to use in measuring outcomes.

"If [the GPRA measurements are] meaningful, then the work is done for them," Masters said. "They don't need to invent the wheel where it's already been invented. On the ground level, this is one of the reasons for involving managers as well as employees; they know what the important functions are and whether they're being achieved."

Merchant said the Maxwell School was working on templates for performance metrics that could be used governmentwide to avoid a "crazy quilt of templates and no uniformity of measurements." She said the national partnership council established in the December executive order needs to play a strong role in propagating national metrics for judging partnerships, though she cautioned that elements like customer service could mean very different things to Veterans Affairs Department hospitals and Navy shipyards, for instance.

The report also emphasized that the administration should portray partnership as an opportunity, not as an obligation.

"The absence of such [partnership] venues deprives management and the public of the full knowledge, skill and commitment that unions and employees can bring to ensure that government functions in a cost-effective manner," the study said.