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1. Summary of the observation A manufacturing company was severely affected by the economic downturn, and it became apparent that the demand for their products had fallen to the point that they had to cut down production. This meant shutting down the less productive plants and selling off some equipment…
The union happened to guarantee their members job security, which was the main reason that nearly all the workers had joined up. A number of alternatives were suggested by managers during a brain storming session, the most extreme being to lay off twenty per cent of the work force permanently. The least disruptive was to retain the full complement of employees and merely schedule them on a revolving four-day work week, until the crisis is over and the company can return to full production. The management eventually decided to reduce the working hours of each production worker instead of laying off employees. They felt that dismissing workers from their jobs would be too disruptive, and before they could do so they would have to meet with the union members and negotiate who should be dismissed, according to the terms of their collective bargaining agreement. They expected stiff opposition and a possible court case if they were to insist on laying off people. Unfortunately, when the decision was implemented, many of the good employees lost interest in their jobs and filed for resignation when they were offered better paying jobs by a competitor firm. 2. ...
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