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What is concession bargaining?

Updated: 9/15/2023
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14y ago

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The 1980's brought in a new era in negotiated wages and benefits. The changing economy and high unemployment levels caused unions to severely adjust their strategies to save jobs and prevent further layoffs. Business owners are willing to agree to increased employment security if unions are willing to see wage freezes and slower benefit increases. These reduction of benefits have been very important in helping to guarantee further job losses. Thus, givebacks or concession bargaining techniques came out of a necessity to maintain employment. It was estimated that nearly two-thirds of all union contracts negotiated in 2005 contained concessions given up by the unions in order for operations to continue where they had existed before.

One of the first and most famous concession bargaining examples occurred in 1979 when the Chrysler corporation was facing bankruptcy. The UAW and Chrysler came to an agreement that gave in excess of $200 million dollars of givebacks and concessions in order to protect the future of the company.

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14y ago
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