Process of Negotiation
Negotiation process permeates the interactions of almost everyone in groups and organizations.
In today’s loosely structured organizations, in which members work with colleagues over whom they have no direct authority and with whom they may not even share a common boss, negotiation skills become critical.
The 5 steps of the negotiation process are;
(1) Preparation and Planning.
(2) Definition of Ground Rules.
(3) Clarification and Justification.
(4) Bargaining and Problem Solving.
(5) Closure and Implementation.
1. Preparation and Planning
Before the start of negations, one must be aware of the conflict, the history leading to the negotiation of the people involved and their perception of the conflict expectations from the negotiations etc.
Before starting the negotiation, it needs to do homework.
What’s the nature of the conflict? What’s the history leading up to this negotiation?
Who’s involved and what are their perceptions of the conflict? Moreover before any negotiation takes place; a decision needs to be taken as to when and where a meeting will take place to discuss the problem and who will attend.
Setting a limited time-scale can also be helpful to prevent disagreement from continuing. This stage involves ensuring all the pertinent facts of the situation are known in order to clarify own position.
2. Definition of Ground Rules
Once the planning and strategy are developed, one has to begin defining the ground rules and procedures with the other party over the negotiation itself that will do the negotiation. Where will it take place?
What time constraints, if any will apply? To what issues will negotiations be limited? Will, there be a specific procedure to follow in an impasse is reached? During this phase, the parties will also exchange their initial proposals or demands.
3. Clarification and Justification
When initial positions have been exchanged both the parties will explain amplify, clarify, bolster and justify their original demands. This need not be confrontational.
Rather it is an opportunity for educating and informing each other on the issues why they are important and how each arrived at their initial demands.
This is the point where one party might want to provide the other party with any documentation that helps support its position.
4. Bargaining and Problem Solving
The essence of the negotiation process is the actual give and take in trying to hash out an agreement, a proper bargain. It is here where concessions will undoubtedly need to be made by both parties.
5. Closure and Implementation
The final step in the negotiation process is formalization the agreement that has been worked out and developing and procedures that are necessary for implementation and monitoring.
For major negotiations – this will require hammering out the specifics in a formal contract.
Negotiation Process has five stages. In all steps of a negotiation process, the involved parties bargain at a systematic way to decide how to allocate scarce resources and maintain each other’s interest.
Procedure for initiating collective bargaining
1. A charter of demands
The trade union will notify the employer for initiating collective bargaining negotiations. The representatives of the trade union draft a charter of demands which contains issues related to terms of employment and the working conditions namely wages and allowances, bonuses, working hours, benefits, holidays. In some cases, an employer may also notify the trade union and initiate collective bargaining negotiations.
Negotiation is the next step after the submission of the charter of demands by the trade union. Both the employer and the employee seek opportunities to suggest compromise solutions in their favour until an agreement is reached. If it impossible to reach out to an agreement, a third party (mediator / arbitrator) may be brought in from outside. If, even with the assistance of the third party, no viable solution can be found to resolve the parties’ differences, the trade union may decide to engage in strikes.
3. Collective bargaining agreement
Pursuant to the negotiations between the parties, a collective bargaining agreement will be executed between the employer and workmen represented by trade unions, setting out the terms of employment and the working conditions of labour.
If both parties fail to reach an agreement because of mutual consensus, the union may go on a strike, which shall be in accordance with the provisions of the Industrial Disputes Act 1947 (“ID Act”).
Once the conciliation officer receives a notice of strike or lockout, the conciliation proceedings shall commence. The State Government may appoint a conciliation officer or a Board of Conciliation to investigate disputes, mediate and promote a settlement. Workers are prohibited from going on strike during the pendency of such conciliation proceedings. Conciliation proceeding may have one of the three outcomes, namely
(i) A settlement
(ii) No settlement
(iii) Reference being made to the appropriate labour court or any other industrial tribunal.
6. Compulsory arbitration or adjudication
When conciliation and mediation fail, parties may either resort to compulsory or voluntary arbitration. Arbitration and the recommendations of the arbitrator may be binding to the parties. Section 7A of the ID Act provides for a labour court or industrial tribunal within a state to adjudicate protracted industrial disputes such as strikes and lockouts. Section 7B of the ID Act provides for constitution of national tribunals to resolve disputes involving questions of national interest or issues concerning more than two states. In the event, a labour dispute is not resolved by conciliation.