This report by the Canadian Labour Market and Productivity Centre-CLMPC (now the Canadian Labour and Business Centre), an independent national labour-business organization, is the culmination of an in-depth examination of adjustment and transition issues as experienced by individuals, enterprises, and sectors. The Task Force on Adjustment and Transition was one of several task forces set up by the CLMPC to further understanding of a number of key areas of concern identified in the 1993 report of CLMPC's Committee on Economic Restructuring. These CLMPC projects in the areas of Access to Capital, Workplace Change, Adjusting to Environmental Change and now, Adjustment and Transition Issues represent a pivotal consensus-building effort that has contributed to improved labour-management relations and to development of joint problem-solving approaches in the workplace.
The Task Force based its analysis and recommendations on an extensive set of case studies which examined how a number of Canadian firms and sectors have dealt with the challenges of adjustment and transition. The central proposition of this report is that optimal solutions to adjustment are found when employers and labour work together to anticipate change and to address it in a proactive rather than a reactive way, using their combined expertise and knowledge of the particular sector or workplace. Through the case studies (which form a solid core for a data base on labour market adjustment partnerships and practices, and could be of great practical use to unions, firms and government; the case studies are available as a companion document to this Report), the Task Force has identified key factors, attitudes, practices and principles that can contribute to effective adaptation and positive adjustment.
The goals of business, labour and government often differ as they enter into an adjustment process. For business, the main goal is generally the survival of a competitive enterprise. For labour, the overriding goal is to preserve economic security for workers. For government and for society, the adjustment process should ensure a balance between efficiency and equity. Although the goals of the different parties may appear to compete, they may also complement each other, as is illustrated in the case studies.
The report posits that all participants stand to benefit from joint approaches to adjustment. For management, advantages include access to the extensive knowledge and understanding of existing operations on the part of front-line workers; better prospects for a smooth outcome in which cost considerations have been fully reflected; probability of an improved bottom line; new workplace relationships which can improve teamwork, joint decision-making and problem-solving; increased productivity; retention of the skills and knowledge of workers; and goodwill and trust of workers. For labour, advantages include the probability of increased economic security; access to information and a role in decision-making; an opportunity to help select and implement the options for change; a chance to ensure that the adjustment plan provides displaced workers with adequate support and training for the transition; and an opportunity to offer options which better address the underlying problems.
The case studies illustrate constructive ways in which key players in individual situations have come together to deal with adjustment related to economic restructuring. Three principal approaches to adjustment have been identified in the cases examined:
| > | restructuring, reshaping or reinventing the enterprise; |
| > | major investments in skills development and the upgrading of human resources, both in reaction to current pressures for change and in anticipation of future; and |
| > | efforts to distribute the impacts of adjustment in an efficient and equitable manner. |
In most cases, an amalgamation of several approaches is the norm.
The case studies and other background work on adjustment provide a rich source of information on how adjustment has been managed in different circumstances. One of the premises of this research is that joint labour-management approaches are more likely (though not guaranteed) to have positive outcomes than approaches which are unilaterally imposed by management or government. Joint approaches, however, require a genuine commitment to encouraging and listening to the input of the co-participant in the process. In many cases, this will involve a significant change in behaviour on both sides.
Innovative adjustment solutions also require that all interested parties be included in the discussion and negotiations, recognizing the various roles and responsibilities of each party. In some cases, agreements are reached between employers and employees without external participation. In other cases, participants in the adjustment process might include labour, management, and government, as well as environmental, community, and aboriginal groups. Because whole communities may be affected by economic dislocation, communities can and should play a role in the adjustment process. The key point of involving all affected groups is to ensure that any agreement reached properly reflects the varied needs and concerns of such groups.
With the goal of improving the process and outcomes for others involved in or facing adjustment challenges, the Task Force has grouped the lessons learned through the case studies, and their associated recommendations, into several key themes:
| > | anticipating and preparing for change; |
| > | dealing with individual, enterprise, community and sectoral adjustment; |
| > | evaluating outcomes; and |
| > | a new role for government. |
The Task Force concludes that optimal outcomes for all parties are best achieved through joint development and negotiation of adjustment plans. This includes both open exchange of information and the earliest possible involvement of all workplace partners in decision-making. Business, labour and government all have important roles to play in the development of effective adjustment strategies.
As each adjustment situation is unique, the value of joint approaches and solutions developed by the affected parties is evident. A key finding is that crisis adjustment that involves unilateral decisions with only a short-term perspective does not meet the test of balance, and may offer only short-term savings at a very high cost to individuals, families, communities, and often the organizations themselves.
