When Recession Does Not Mean Layoffs, II

Responding to the Shopfloor.org post Thursday on the NPR story featuring manufacturers whose policy it is to not lay off employees, labor journalist Frank Koller — who was quoted in the “Morning Edition” report — offers a few additional observations:

The reason why unions have been suspicious of no-layoff policies – much more so during the first 75 years of the last century – is quite understandable. In order to work for everyone’s benefit, these policies are based on a sense of trust throughout a company that sacrifices in hard times will be shared equally across the firm (for example in terms of lower compensation and/or reduced hours of work to avoid layoffs) – and of course, the same requirement for sharing equally needs to apply to the shared gains in good times.

All too often, the rhetoric of sharing has tended to work one way only – labor shares the pain, management shares the gains – and so, in all too many cases, over the years, the distrust by workers (organized or not) towards no-layoff policies has been perfectly justified.

In the cases of Lincoln Electric (in operation in Cleveland since 1895) and Hypertherm (in Hanover, New Hampshire since 1968), trust has simply become part of the corporate DNA of both firms and their workforces.

It has taken these firms decades of committed leadership to nurture a widely-felt belief that indeed, over the long-term – “we are in this together and will as a result, ultimately, we will benefit together.” It’s not easy – but it is powerful business model. Layoffs are enshrined as the absolute last step to ensure firm survival, rather than just another tool in management’s quiver.

Frank reports that his book on Lincoln Electric’s history of guaranteed employment – which includes a profile of Hypertherm, as well – is called “SPARK” and is due for publication by PublicAffairs in New York City next February 23. You can see more about the book at:
http://www.frankkoller.com … and

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