Thursday, September 06, 2012

The Bankruptcy Conundrum 

When a company reorganizes under bankruptcy, workers are losers.  Here is a typical case.   This raises the question of employee relations going forward.  If you were an AMR pilot and your pay contract has been put on the block, would you be happy?  Or, would you accept that the environment has changed and get on with your job?  Either way, there is an employee relations challenge.  How does management win back key workers, and how will it restrain them from asking for a wage package in the future that makes up for what they have lost in the present?  Bankruptcy is a financial reset.  It is a chance for a company to begin again.  Employees, however, don't always grasp what that means.  Over time they realize they may never return to the wage level they had and that realization almost always leads to cynicism and bitterness.  Imagine communicating to them that the company values their labor.


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