Working Together for Public Service:EXECUTIVE.SUMMARY

U.S. DEPARTMENT OF LABOR
Working Together for Public Service

EXECUTIVE SUMMARY

The economic success of our nation and the social well-being of its citizens depend, in large measure, on the essential services and infrastructure provided by state and local governments. We rely upon those employed within the public sector to teach our children, to protect us from crime and fire, to maintain roads, bridges and sanitation systems, to provide necessary social services, and to safeguard the environment.

"In this era of reinventing government, our nation's citizens need and deserve high-quality, cost-effective state and local government services," observed US Secretary of Labor Robert B. Reich when he formed this Task Force to examine labor-management cooperation in state and local governments. "Further, the imperative to compete in an increasingly worldwide economy and to respond to increasing societal demands requires that governments at all levels perform in a timely and cost-effective manner.

"I am relying on this Task Force to chart a clear path toward that goal through labor-management cooperation."

To this end, the Task Force's research included five regional visits across the United States, seven Washington, D.C. hearings and approximately 55 detailed responses to a Task Force survey. During the regional visits, the Task Force carefully examined and analyzed nearly 50 examples of cooperative approaches to labor-management relationships that were instrumental in creating service-oriented environments. The examples came from state, county and city governments, schools, transit and other special services. First-hand observations were further supported by reports of other impressive service improvements from jurisdictions the Task Force was unable to visit.

Key Findings

The findings in this report are the unanimous conclusions of a 14 member Task Force on Excellence in State and Local Government through Labor-Management Cooperation, whose members were drawn from the ranks of labor, management, elected officials, neutrals and academics.

The findings include the following:

To meet their obligations, state and local governments must transform the way services are planned and delivered, the way the public workplace is managed and how public worker knowledge is engaged in the process.

In most places, the public workplace of the future will have to be different than it is today in order to meet the challenges it will face. Traditional methods of service delivery, traditional personnel and administrative systems, traditional styles of supervision and workplace communication, and traditional approaches to collective bargaining will not be sufficient.

In order to meet these challenges, many state and local governments have begun to move away from traditional ways of doing business. Like many successful private sector companies, they are depending upon the participation of employees. When successful, this strategy leads to continuous improvement, not merely one-time changes.

Service improvement through workplace cooperation requires that the confrontational rhetoric be lowered and that elected officials, union leaders and workers focus on their common tasks. To do so, they will need new tools. Those tools are in use in many places now.

A focus on service with employee participation can also be a doorway to reducing confrontation in collective bargaining relationships that have had a history of conflict.

The possibilities appear to be greater than recognized for labor-management cooperation in the public sector to contribute to service improvement and provide avenues for employee participation, and perhaps greater than in the private sector.

Looking across the dozens of examples that it examined, the Task Force found that labor-management cooperation which engaged employees in decisions around service planning and implementation typically resulted in:

Better Service. Services frequently became faster; often new or expanded services were offered, and all were more responsive to citizens.
More Cost-Effectiveness. Money was saved and money better spent.
Better Quality of Work Life. Employees experienced far more involvement and greater opportunities to contribute, learn skills. They gained greater job security and found increased respect.
Improved Labor-Management Relations. Less conflict, faster conflict resolution, more flexible contracts, and emphasis on mutual responsibilities for service improvement.

Challenge to Labor and Management

In view of these and other findings summarized below and the need for transformation in the way public services are delivered, the Task Force challenges labor and management leaders, both locally and nationally, to follow the lead of the examples in this report, to break some molds, forge new ground and seek a new approach.

Some Quick Examples

Here is a sample of what was observed

A labor-management committee in Connecticut's Department of Mental Retardation with District 1199/New England Health Care Employees Union (SEIU) tackled the issue of how to improve employee safety. In one year, the committee's recommendations produced a 40 percent reduction in injuries and a 23 percent reduction -- or nearly $5 million -- in what had been an annual $25 million workers' compensation expenditure.

In Peoria, Illinois, health care was becoming a yearly budget-buster. Costs were climbing annually at 9 percent to 14 percent, while total city revenues were going down. With cooperation of all city unions, Peoria took health care off the bargaining table in 1993 and placed it in its own Joint Labor-Management Committee to Control Health Care Costs. The result was 1994 health care costs of $1.2 million less than the expected $6 million. In sharp contrast to past experience, when virtually every health care decision was fought over and bitterly arbitrated, no health care decisions have been arbitrated since this plan was implemented.

In Madison, Wisconsin, as part of a city-wide quality initiative, labor-management cooperation dramatically improved a contentious relationship between city building inspectors, represented by AFSCME Local 60, and private electrical contractors. Management, employees and their union worked together with contractors to develop a compliance effort that emphasizes education instead of punishment. It led to a program that now enhances electrical safety, conserves resources, focuses inspection efforts on safety outcomes instead of inspection processes, and improves customer relations. Inspectors happily report they now receive compliments instead of complaints.

Spurred by a severe, city-wide budget crunch, the Los Angeles Bureau of Sanitation formed a joint labor-management committee with SEIU Local 47 in 1994 with the twin goals of trimming costs and improving service delivery. Thanks to the work of this committee, the Bureau increased truck availability from 75 percent to 94 percent, largely by improving cooperation between drivers and mechanics and their respective departments; and reduced overtime by 54 percent due to increased truck availability. Over the ensuing three years, it expects a 25 percent departmental cost reduction without lay-offs.

At the Foshay School in south-central Los Angeles, scholastic records were among the lowest in the state before the new principal and the leadership of United Teachers of Los Angeles introduced a Leadership Council, which brings together administrators, teachers, parents and community members to work together to improve the education of the largely minority student body. Student drop-outs have fallen from 21 percent of the student body to 3.5 percent; suspensions have dropped from 400 cases to 40, and student scores on a comprehensive test of basic skills in math, reading and language have improved to near the state average.

In Phoenix, Arizona, a new fire chief and new president of Firefighters Local 493 took office in 1978. They decided it was time to work together and end nearly 40 years of contentious and adversarial relations. They initiated annual planning retreats during which labor and management jointly develop annual plans for addressing problems and seeking improvement. Arbitration has not been used in Phoenix for 10 years.

Similar stories sprinkled through this report are found in activities that cover a spectrum of services, in jurisdictions large and small, and in all regions of the country. They tell of improvements that citizens, workers, managers, elected officials and union leaders everywhere would be happy to see occur within their own communities.

The experiences of these jurisdictions and programs provide compelling evidence that engaging employees in workplace decision-making -- a model with parallels to similar efforts in the private sector -- can be a powerful tool to achieve tangible improvements in service, cost savings, quality of work life and labor-management relations.

These examples, and several others in richer texture, make up Chapter One, "Typical Results." Six examples, called "Snapshots," are presented in considerable detail following each chapter, and dozens of others are used to illuminate the principles in Chapter Four. (The Appendix includes a full listing of examples visited and submitted.)

Pressures and Challenges to Change

Chapter Two, reviewing pressures on state and local government, and Chapter Three, on trends that define and affect state and local government employment, describe some of the important forces that compel or offer opportunities for change:

More pressure to take up tasks formerly or currently done by the Federal government

Increasing challenges as communities grow more complex and more diverse, as environmental pressures grow and as technology changes the way people live, work and communicate

Growing awareness of and demand for quality services.

Financial pressures requiring more cost effectiveness, better ways of delivering service

Growing awareness of the need to handle pension funds responsibly

Decades of using procedures for budgeting, personnel, and labor relations which don't easily permit a focus on service delivery, stemming from traditions and practices developed in a different era

Trend towards joining unions, reflecting partially a desire to better bring problems and ideas to the attention of employers

A highly educated public workforce, which shows a strong interest in participating in workplace decisions

A desire among workers for more cooperative ways of dealing with employers

Pressures to perform better, forcing labor and management to examine relationships that have traditionally been conflictual

Public employee unions active nationally and locally, that support workplace innovation and service improvement

Generally, a less adversarial labor-management climate than in the private sector

Despite rhetoric to the contrary, willingness among many elected officials and managers to work with the workforce and with union leaders

A growing realization that labor and management are in the same boat. They must work together and contribute their respective influence, knowledge and skills to improve public service

Increased interest in contracting out as an alternative for cost reduction or service improvement has created a variety of pressures and responses, many of which vary from common perceptions on the subject. (See Chapters Two and Three for discussions of issues and trends in contracting out.)

Overall, there is a confluence of pressures, interests and opportunities for change in the way public services are delivered, and the opportunity to use participative workplace principles, particularly labor-management cooperation, as a primary means to do so.

How to Implement Broader Use of Workplace Partnerships that Improve Service

Chapters Four ("Nuts and Bolts") and Five ("Everyone Has a Role to Play") describe barriers and ingredients to developing workplace partnerships.

Typical Barriers to Establishing Workplace Partnerships

Mistrust, often arising from a history of difficult workplace relationships, recent campaigns, impasses, or other conflicts

Lack of skills for carrying on participative relationships. Parties otherwise fall back on skills common to hierarchical management or traditional labor-management relationships

Failure to recognize that the partnership program must be developed in concert with all affected parties. It rarely works if it is only the idea of one group

Continued reliance on formal aspects of personnel/labor relations, such as refusal to try new approaches, or reluctance to discuss issues necessary to service improvement

Fear of job loss makes employees and some managers reluctant to join in problem-solving

Union leaders, unwilling to support the effort if a participative program ignores their role and is seen as an attempt to bust the union

Mid-level managers or union officials who may feel their traditional roles or status threatened by the team-oriented and participative arrangements

How to Begin

Start Small. Typically, the effort starts small, in one part of the jurisdiction or agency, takes time to develop, take root, and spread. Some begin with a broader scale attempt to alter the work culture. Most start with one of the following:
- a service improvement project -- usually one that has posed challenges
- desire to reduce conflict, usually grievances
- desire to improve a difficult collective bargaininging relationship

It's a Circle. Whether the participative effort begins with a service project, or any of the others, the same skills, people and relationships are involved. These factors, and the trust that builds, can transfer from one area or project to another.

Where You Start Depends On Where You Begin. Every place has its own history and possibilities. Therefore, the choice of where to begin must be a local decision by the parties.

Leadership Commitment. Success requires leadership commitment, on both sides, to start and overcome mistrust, to keep people focused in the early going, overcome early barriers and resistance, and put the effort and relationship on track after inevitable mistakes.

Break with Past Habits. It is too easy to revert to old habits and ways of doing business. To move into these new ways of planning and delivering services, there must be no more business as usual.
- Training. Usually, there was some degree of training to help the parties get started. When training is connected to beginning and sustaining new ways of managing and of involving workers, it's likely to be a good in-vestment. The most effective and accepted training is jointly developed and sponsored. Necessary are development of new skills:
  - in conflict resolution and group problem solving
  - in order to perform jobs in new ways
  - for analyzing and changing work processes
- Neutral Assistance. Most new relationships had the benefit of a skilled neutral to assist and often to train the parties.
- Conflict Resolution. Ensure that efforts and mechanisms to resolve conflicts are in place. Unnecessary conflict can breed mistrust that interferes with cooperation and participation. Make use of alternative dispute resolution practices that fit the issues.

Employment Security. It may seem counter intuitive, but although layoffs are often a favorite method of seeking cost savings, examples show the opposite to hold more promise:
- Job "safety net" programs, including in some instances no-layoff guarantees, were common practice in workplaces that have achieved significant cost savings and service improvements.
- This doesn't mean there are no layoffs, but when there are, it is done under a plan that show commitment to employee welfare.
- The security assurances allow employees to focus on innovation without undue fear of job loss. They also allow union leaders to focus on service improvement rather than spending time seeking ways to save jobs one at a time.

Respecting the Role of the Union. Similarly, when the legitimacy and role of the union is not challenged, union leaders can focus their efforts on service improvement. Mutual respect of labor and management leadership is critical to success.

Flexibility on Both Sides. A willingness to try new approaches as well as a new processes for decision-making are necessities for finding innovative service solutions.

Increased Cohesion Within Each Side.
- Legislative and executive branches, and the various management functions must be in sufficient harmony, otherwise one or the other of the factions can upset the relationship by acting in the old ways or being otherwise unaware.
- By the same token, unions involved normally form a coalition. Among other things, such coalitions facilitate resolution of jurisdictional problems interfering with service improvement.

Changed Roles for Labor and Management in Collective Bargaining Relationships.
- In successful cooperative arrangements, management operates in less hierarchical ways and agrees, through joint and team structures established, to share decision-making authority where it has not traditionally done so.
- The counterpart phenomenon is that union leaders share power in a responsible fashion while still vigorously defending worker interests. Normally there is less necessity to defend in the old ways, since many problems are resolved through joint problem-solving over service issues before they become contentious.
- In these successful ventures, union leaders often take on, and execute well, significant responsibility for service delivery improvement and cost control.

Success Can Come From Even the Poorest of Histories. Some of the most impressive successes come from relationships that had been extremely contentious.

Spreading and Sustaining Successful Cooperative Relationships

Spreading the Innovation and Expanding the Participation. Even successful experiments struggle with how to spread the use of a successful cooperative effort to another service or department. It is important that the same leaders have influence in the new area, and that there are leadership and training resources applied to the germination. Also, the new effort must come to be owned by those newly involved, which implies that they have a role in forming it.

Leadership Turnover. Perhaps the largest challenge is sustaining useful changes in the face of the common phenomenon of leadership turnover. Unlike many private sector leadership changes, in public life, there seems to be a more common penchant for declaring "ineffective" everything that came before. Campaigns are often run and won this way. Particularly with the frequent occurrence of blaming problems on public employees, a return to confrontation is often a danger in a period of turnover. A number of methods seem to contribute to sustaining the gains of a cooperative relationship following a transition -- some formal, some informal:
- Among the more formal is the presence in a labor contract of the main features of the system, including a joint committee, training and other features.
- Less formal is the involvement of a broad sample of front line workers committed to the system.
- In non-bargaining situations, a major factor seems to be the tenure of a long serving chief executive committed to employee involvement.

Improvements in Administrative Systems. Improvements that make administrative systems more responsive to service needs accompany most of the successful examples. Front line workers and union leaders have demonstrated they have a lot to contribute in identifying system blockages and proposing practical reform:
- Personnel systems were changed to allow more responsiveness to service.
  - classification systems were revised to have fewer titles, some reduced by more than 50 percent, and ranges broadened to allow more flexible deployment in the face of changed service delivery methods and efficiencies
  - advent of gainsharing.
  - much greater use of team, rather than individual, recognition
  - improved accountability and coaching for workers
  - more use of peer evaluation and scrutiny to ensure everyone is carrying his or her share of the load
  - better management development and selection to improve accountability and management style in a non-hierarchical setting
- Changes in accounting, budgeting, and purchasing practices to better measure and support service improvement.
- improved cost and quality measures, to allow examination of inputs to services, and make more accurate comparisons with privately offered services
- simpler procurement and other internal systems

Many of these systems have for years been targets of generalized reform. Examples from this effort suggest reform may come more easily and have more community and political support if the change is more targeted, and explicitly related to service and cost improvement. Labor and management often go together to the appropriate authorities to seek changes that, in past years, they might have fought over.

Service-Oriented Relationships and Collective Bargaining Structures. Employees have shown a strong interest in, and ability to contribute to, workplace decisions affecting service quality if the requisite structure is in place for them to do so. In specific ways outlined in the report, the Task Force found that the structure and roles in a formal labor-management relationship, when carried out using cooperative principles, are extremely supportive of quality improvement efforts and outcomes in public services.
Public employees have shown, in the large majority of the instances where they have the opportunity, an interest in being collectively represented. There is reluctance among managers and elected officials in many places to afford employees the right of representation by unions. Unfortunately, not all labor-management relationships are productive and some are overly conflictual.

However, the application of a cooperative, service-focused model of labor-management relationships, as the Task Force has seen, is capable of producing superior service results and cost effectiveness as key products of the relationship. Although adversarial aspects of the workplace relationship necessarily remain, a far different climate and result pertain when the relationship is based on cooperative and service-oriented principles.

Task Force members support the right of individuals to choose whether or not they wish to have collective representation. Where public employees choose to be represented, their collective bargaining rights should be exercised in a framework where: the focus is on service delivery; conflicts can be effectively resolved; and where the relationship, structure and roles are defined and developed to support service improvement, effective workplace participation and partnerships, and constructive conflict resolution.

Jurisdictions contemplating the establishment of collective bargaining relationships should develop their laws with these cooperative, service-oriented principles in mind. In doing so, the laws should be drawn in a way that the parties can realistically address service problems. On the other hand, in making these arrangements, care should be taken not to unduly interfere with the overall mission of an agency or program and the responsibilities of public officials.

Where an established bargaining relationship has been conflictual, the parties should move towards the cooperative model. The possibility of doing so--even out of historically difficult relationships--has been clearly demonstrated in the work of the Task Force. This report contains guidance on how to begin or how to transform labor-management relationships into mutually productive vehicles for quality service and more satisfying work.

Whether or not employees are collectively represented, the examples in bargaining and non-bargaining settings examined by the Task Force make it clear that employees, managers, elected officials and citizens benefit from employee participation and involvement in determining how best to provide public services.

Organizational Structures that Support Participation

Flatter Organizations. Rather than rely on hierarchy, common organizational changes in successful service partnerships include fewer supervisory layers and the use of teams. These often cross departmental lines and include a greater proportion of employees in line service positions. Teams make, or continue to make, key decisions that were previously the preserve of a supervisor. Often heard were phrases like "None of us is smarter than all of us."

Joint Labor-Management Committees. Perhaps the most common organizational and communications device in successful partnerships is the establishment of a top level labor management committee, usually in a department, but sometimes in the overall jurisdiction. This group typically sets the agenda and the pace for partnership initiatives, and has representation from union leadership and program management. Personnel and labor professionals are most productive in this setting when their role becomes facilitative rather than advocacy; a role transformation, and one they report as very satisfying. Such a committee meets regularly and identifies agreed upon areas for activity and then engages appropriate talent and resources in specific projects.

Project Teams. Typically, project teams are formed, often receiving their mandate from the joint committee. Project teams, or teams for an ongoing activity, are one of the primary engines in workplace participation. They bring together workers and managers from different parts and levels of the organization to resolve problems and make improvements.

Team and Committee Selection. Even in non-bargaining states where the Task Force saw examples, employees involved, not chosen by their peers, found that their standing and capacity to act within the committees or teams would have been enhanced if they had been chosen by their co-workers rather than by management. Thus, in either case, it is important for effective labor-management cooperation that employee representatives be selected by their co-workers. When employees have an opportunity to choose representatives to reflect their own viewpoints and represent their interests on joint labor-management committees and project teams, the results of participative committees and similar activities have a greater likelihood of being trusted, accepted and implemented by the rank and file.

Meetings are better. Without the need to observe hierarchy, with new skills for group problem solving and a mandate to solve problems, be flexible, and try new things, there is greatly improved communication, participation and problem-solving efficiency in workplace meetings.

Changes in Labor-Management Relations

In addition to what has already been discussed, important improvements in collective bargaining relationships accompany service-oriented workplace partnerships:

greater mutual focus on service delivery within and around the bargaining relationship

reduction in conflict; reduced reliance on legalistic, formal means of resolution; many fewer formal grievances

faster contract settlements, sometimes in weeks; reduction in resort to arbitration

predominance of "win-win" and "collaborative bargaining" rather than traditional bargaining, but parties are still effective advocates for their constituency's interests

contract preambles describing mutual service responsibilities and mutual respect

more flexible contracts, allowing easier adjustments to service needs

more focus in contracts on how problems will be resolved

labor relations professionals on both sides to concentrate on the service impact of the relationship

more candid mutual acknowledgment of electoral and constituency issues faced by both management and labor leaders

parties willing and able to discuss all issues affecting service delivery without invoking formal constraints and fear of precedent

Institutional Support

Successful parties are not alone. New skills are necessary, and so is peer support. It's difficult for a labor or management leader to step out and take the risks inherent in breaking with the past. (Chapter Five discusses some of these support needs, and efforts already underway.)

Labor Organizations. National and international unions are increasingly active in support of these workplace innovations.
- Many have already invested in activities to develop local leadership abilities to participate in cooperative workplace partnerships. Support of national and regional leaders and institutions provide peer support as does training and consulting resources made available by national organizations
- Also, service to individual members concerning their own professional development is growing, as for example in education, in which there are major national initiatives
- Many of these service activities and the support of union leadership would be surprising to some observers, yet they support what surveys cited in Chapter Two describe as employee interest in participation and adding to the quality of the service

Management Institutions. Management organizations that help elected and appointed officials get acclimated to new roles are in a pivotal position to help them gain immediate perspective on how to engage in the more complex, but ultimately productive, dialogue with the workforce and its representatives; to show newly elected officials and their key advisers this positive tool for resolving service and cost issues for which they are accountable and jointly responsible.

Finance and Personnel Professionals. National organizations supporting finance, personnel and other key professions can assist and are already pursuing system changes that will better support services, and can develop more service-oriented principles to guide administrative systems.

Universities and Training Centers. These institutions can also expand their efforts and offerings to support labor and management leadership development that displays these more effective approaches. For almost everyone involved in workplace relationships and public service systems, new roles and approaches are necessary and the places where individuals receive their professional training, information and guidance will have to adapt to the needs of the public sector workplace.

Neutral Agencies. Also helpful are many neutral agencies, none more than the Federal Mediation and Conciliation Service, with its technical assistance to parties, and particularly well-regarded workplace cooperation grants and conferences program supporting cooperative labor-management relationships. Many of the state public employment relations boards have begun, and others are beginning, to expand their preventative training and technical assistance activities.

Without the support of national labor and management organizations, and other institutions affecting the process, the local parties will not have the resources, the knowledge or the backing to make the necessary changes.

Food for Thought

A number of issues require further observation in order to assist the success of participation and cooperative labor-management relations in promoting service delivery improvement. (A number of these, although by no means a comprehensive list, are presented in Chapter Six.) For example:

Determining how to spread the new approaches from one project to broader application

Assessing and gaining leadership commitment and involvement

Connecting quality efforts and collective bargaining

Developing better cost and quality measures

Identifying the most important skills for effective worker and management participation

Identifying resistance of mid-level supervisors and union officials

Examining effects of unit composition and scope of bargaining

Defining changed roles of key players in the process

Studying impacts and efficacy of contracting out

Assessing use of ADR for resolving disputes over workplace rights

Without question, the challenges facing state and local government can get an important assist from the application of significant employee participation and cooperative labor-management relationships. Large scale service improvement, major cost savings, more loyal, creative and satisfied employees, and better labor-management relations are the result. Elected officials and managers, as the following examples show, are as gratified by the results as are employees and union leaders. Many elected officials, who were skeptical of public workers' ability to meet service and cost goals, later became convinced of the value of the participative approach and of doing so within a labor-management partnership. In some instances where contracting out was the preferred strategy during an election campaign, cooperation became the dominant strategy after some experience with both.

While the practice of contracting out takes place in some jurisdictions as part of an overall service-improvement strategy, the degree and simplicity of contracting out does not appear to be as substantial or on the rise to the extent portrayed in popular discussion. Within a cooperative workplace partnership, for most core services, reforms that emerge from employee participation usually produce equal or better quality and cost results than contracting out.

There are identifiable ingredients to begin and support cooperative, service oriented workplace relationships. Some are directly part of the workplace relationship, others involve other systems and institutions that affect service delivery. Almost all can be affected through a labor-management partnership.

The Task Force, composed of elected officials, managers, neutrals, academics and labor leaders, is unanimous in its view that this cooperative and participative approach represents a significant opportunity to respond to the pressures and demands on public officials and public workers. It can help turn confrontative labor-management relations into a productive interaction that enhances service improvement and cost consciousness and is representative of the way in which the public workplace must be transformed to respond to the forces that are already upon us.

Not every jurisdiction or workplace can do this. Some histories are too bitter; some leaders lack the ability. But many more than are currently engaged can do so, given the knowledge, resources and peer support becoming available. The Task Force urges them to try. Many painful histories have been plowed under as a result of successful cooperation.

The Task Force has had an opportunity through its regional visits and hearings to get a glimpse at the future of the state and local government workplace. Elected officials, administrative professionals, managers, union leaders and the organizations that support each of them, and which prepare them for and chronicle their interactions, all have an obligation to each other and to citizens to take up the unanimous challenge of this Task Force: to break the traditional habits of hierarchy, bureaucracy, confrontation, and over-reliance on formalities, and begin now--even while protecting their capacity to exercise their responsibilities--to develop the cooperative and participative patterns in the public workplace and in labor-management relations that support innovation and mutual focus on excellence in public service.