Fisher & Paykel With The Epmu: A Case Study in Management/ Union Partnership

FISHER & PAYKEL WITH THE EPMU
A CASE STUDY IN MANAGEMENT/

UNION PARTNERSHIP
A Case Study Commissioned by the

Partnership Resource Centre
By Owen Harvey
February 2006
PRC case study series no. 3
PARTNERSHIP
RESOURCE
CENTRE
The purpose of this occasional paper series is to
provide case studies and other publications to
promote best practice and share experience in
partnership approaches.
The views expressed in this occasional paper

do not necessarily represent the views of the
Department of Labour.
ISBN 0-478-28038-6
© 2006
Partnership Resource Centre,

Department of Labour,
PO Box 3705,
Wellington, New Zealand
Ph 64-4-915-6259
Email [email protected]
Web www.dol.govt.nz
2 PRC Case Study Series No.3

Contents
1. Introduction and Purpose................................ 4 6. Challenges and Dilemmas for

Purpose.......................................................................... 4 Partnership........................................................22
Structures and processes – in practice.......22
2. Background to the Development of
Union perspective....................................................24
Partnership at Fisher & Paykel Appliances... 6
Where philosophy meets business
Thumbnail sketch of F&PA and EPMU............... 6
pragmatism................................................................24
What is F&PA about?................................................ 6
Consultation at F&PA – unbundled...................25
Key moments in recent history............................7
Staying on the pace................................................28
Emergence of ‘modern’ partnership................. 8
F&PA today.................................................................. 10 7. Critical Success Factors................................31
Values and philosophy base................................. 31
3. Foundations for Partnership........................ 12
Three-way relationship......................................... 31
Composite Agreement.......................................... 12
Commitment to each other’s success........... 31
Structures and processes – the set-up...... 13
High performance culture................................... 31
4. Partnership in Action......................................15
Live it daily...................................................................32
Day to day.................................................................... 15
Longevity and continuity of management....32
Attendance Committee........................................ 15
Integration of partnership into
Living it.......................................................................... 16
management structures......................................32
Communicate, communicate................................17
Openness and communication...........................32
Examples of partnership in action....................17
Responsibility model...............................................32
Strike............................................................................. 18
8. Reflections, Conclusions................................34
Skill based pay........................................................... 18
Appendix: List of Interviewees............................35
5. Benefits of Partnership..................................20
Community benefits................................................20
Management perspective....................................20
Union perspective....................................................20
The workers’ view..................................................... 21
PRC Case Study Series No.3 3

1. Introduction and Purpose
This case study has been commissioned by the • provides some context which illustrates how
Partnership Resource Centre (PRC) which is part the partnership has evolved over time
of the Department of Labour. The PRC has been • describes the nature of the relationship and
established by the Government to help employers some of the structures and processes that
and unions build constructive workplace underpin it
partnerships. Workplace partnership is about • provides some examples of partnership in
an active relationship between employers and action and the tangible benefits achieved
unions that can help organisations respond • describes some of the challenges and issues
to change, build capability, and improve currently confronting the partners.
performance, worker contribution and the quality
As with most matters to do with human
of the workplace for employees.
interaction and behaviour in complex
The underlying idea of a partnership is that organisations, it is very difficult to attribute
there is something in it for all parties if each events and outcomes to any particular cause.
is genuinely committed to the success of the In the case of F&PA, a combination of values,
other. This doesn’t rule out conflict, but the idea philosophy, work organisation, leadership ability
is that the parties work together on a broader and business realities and at times sheer luck
range of workplace issues (than just wages and and propitious circumstances, have come
conditions) and work through disagreement in together over many years to create a unique and
a way that will preserve and build an ongoing special company. In the words of Mike Sweeney
relationship. from the EPMU:
Purpose “If you want to know how capital

and labour can work, how profound
Fisher & Paykel Appliances Limited (F&PA) and the
it can be, Fisher & Paykel’s the best
Engineering, Printing and Manufacturing Union
example I know. And around the
(EPMU) have forged a special relationship over
world too. I go to other places and
many years. This case study sets out to provide workers are that bloody cynical but
some insight into that relationship. It is not never at F&PA. It has got something
intended to be a template for how to implement that I was pleased to be part of,
partnership or to be a comprehensive account of still am. It works well and is worth
the full history of the relationship; rather it: preserving. It’s a kiwi thing. It’s
unique.” 1
1 “Defying Gravity – The Fisher & Paykel Story,” Keith Davis, David Ling Publishing, Auckland 2004.

It is hoped that the shared experiences of some useful raw material to the two parties
the two partners described in the case study at F&PA, as they evaluate and regenerate their
may be valuable in informing other workplace partnership to meet emerging challenges.
partnership initiatives, as well as providing

2. Background to the Development of Partnership at
Fisher & Paykel Appliances
Thumbnail sketch of F&PA and EPMU in terms of how much manufacturing ends up
being undertaken off-shore. Its recent decision
As noted in the official company history, Defying
to build a new plant in Ohio in the US points to
Gravity – The Fisher & Paykel Story, F&PA is a
what could happen over time, as the company
New Zealand icon with a unique and fascinating
becomes more global.
industrial relations history. While it is beyond
the scope of this case study to fully trace The EPMU is the union representing staff
this history in all its complexity and richness, at F&PA. It has over 1400 members and 29
it is important in gaining an understanding of delegates out of a total workforce of 2400
partnership at F&PA to connect some key phases across the Auckland and Dunedin sites. Each site
in the company’s development with the evolution has a nearly full-time Convenor of Delegates
of the industrial relationship. and a number of area delegates. There is also a
full-time Chair of Convenors, elected by union
Originally founded in 1934 by Woolf Fisher
members and paid for by the company.
and Maurice Paykel, F&PA has evolved into a
world beating New Zealand brand synonymous
What is F&PA about?
with technological innovation and successful
international marketing of whiteware products. Under John Bongard’s leadership in the late
It has developed a sophisticated and balanced 1990s, F&PA generated four words that translate
capability across the value creation process: into what the company sees as its DNA: Style;
from accessing market intelligence from Integrity; Care; Innovation. These words are used
its customers, through leading design and throughout the business as checklists against
engineering, to manufacturing, marketing, which different activities are tested to see
distribution, and service. whether they fit or not. If not, it is usually time
for a reality check. Many larger organisations
The focus of this case study is on its Auckland
adopt a set of values that are supposed to
based manufacturing operations which are
reflect their particular character (or at least
currently part of Fisher & Paykel Appliances
what they aspire to become), fewer actually live
Holdings Limited (listed in 2001 after
them. To a large extent, this case study is an
separating from Fisher & Paykel Healthcare
examination of the ways in which F&PA reflects
Corporation Limited). The F&PA Group earned
its values through its relationships with its staff
revenue exceeding $1 billion for the first time
and the EPMU.
in the 2004/05 financial year. F&PA also has
manufacturing operations in Australia and the For the purposes of this study with its focus
US. Overseas sales account for over 75% of on workplace and industrial relationships, the
the company’s revenue making F&PA a truly organisational culture of F&PA is of critical
international company. F&PA is at the crossroads importance. Right from the beginning, the two

founders brought with them an enlightened In other words, how replicable is this model?
paternalism which was expressed by such Does it depend on the disposition of the owners
sentiments as “a full tummy is a happy tummy” and managers, or can it be created in a variety of
and the belief that no one should go home with other circumstances?
less than forty hours’ pay if they are genuinely
sick. Concern for the welfare of employees at Key moments in recent history
work and at home also extended to creating
Prior to the mid 1980s, F&PA was caught
a pleasant environment in which to work. This
up in the industrial relations climate of the
legacy has been passed down to subsequent
day characterised by the national awards
generations of leaders (including family
system overseen by a very active, and in some
members) who have, over 70 years, evolved a
cases, militant union movement. However, the
sophisticated approach to staff and other
benevolent practices of the company’s owners
relationships that is based on concern for the
and leading managers have always been in
welfare of staff and both encouraging and
evidence. This extended to their approach
recognising their active contribution to the
to unions with the company endeavouring to
business.
maintain constructive relations with 13 separate
This approach is also expressed in the unions in a volatile industrial environment. Even
participative forms of work organisation adopted then, something of the company’s current
by the company. As one senior manager put it: approach to industrial relations was evident
in the philosophy of Managing Director, Don
“If we want to create an Rowlands:
environment where people can
flourish we need to develop the “If you have a union problem there
leadership model that supports it.” is something wrong with your
management.”2
Of course the company’s values have also been
influenced to a degree by its interactions over The establishment of a company-wide bonus
many years with unions (amongst other external scheme (redefined in 1978) demonstrated the
influences). company’s approach to its people. Delegates and
It is of interest to this case study to explore union officials could see that if the company was
the history of what came first: that is, have the successful then workers could share in some
company’s values formed independently of the of that success. It also demonstrated that the
partnership and therefore have been a decisive company was keen to forge a unique relationship
contributing driver to its formation, or does the with its staff that wasn’t overly influenced by the
complex interplay between company values and wider IR climate. Even at this stage, F&PA was
union influence together create the partnership? expressing a desire for tri-lateral relationships
2 “Defying Gravity – The Fisher & Paykel Story,” Keith Davis, David Ling Publishing, Auckland 2004.

in the workplace, where it could maintain in practice. After this journey, and after much
a separate relationship with both its own careful discussion and debate over a period of
workforce and their representatives in the form time, Rowlands presented the assembled union
of unions, without one undermining the other. leaders with a choice:
Emergence of ‘modern’ partnership “We are up against stiff competition.

We have the talent, the product and
More recent history at F&PA, starting in the
the money to invest but I need to
mid-1980s and still under the leadership of
know if you guys are with us or not.
Rowlands, has shaped the current form of union/
But I don’t want 13 unions. We want
management relations in the company. To the one debate a year over salaries and
concern for the welfare of the workforce by the wages, that’s all.”
founders was added the philosophy and tools Don Rowlands, quoted on p.264,
of the quality movement with their emphasis on Defying Gravity etc
continuous improvement and teamwork. These
‘management technologies’ were embraced So began the process of negotiating the
wholeheartedly at a time, when: F&PA Composite Agreement that signalled the
• there were significant quality issues in the beginning of the modern era of partnership.
refrigeration plant and in the production of EPMU Northern Secretary, Mike Sweeney, was
Gentle Annie washing machines made Chairman of the negotiation committee.
• the company was overcoming the effects of This significant shift in the union/management
the collapse of major shareholder, Equiticorp relationship onto a more constructive and
• the Labour Government had just lowered F&PA focused footing was accompanied by
tariffs and cut import licensing exposing F&PA a major reorganisation of work through the
to more intense competition from imports establishment of production teams using quality
• the company was looking to escape from being tools and measures.
caught up in a wider and volatile industrial
The integrity of the company’s approach and the
climate (described by one manager as “head
results it delivered helped to recruit the unions
bashing”) by initiating its own composite
who became advocates of what the company was
industrial agreement rather than negotiating
aiming to do. Given F&PA’s history of enlightened
14 different agreements with all the different
treatment of the workforce this did not
unions following on from involvement in an
require any great leap of faith. This was further
annual trendsetting industrial award round.
reinforced by F&PA positively responding to and
The company invited a number of union officials EPMU proposal to adopt a skill based pay system
and delegates on a joint study tour to Japan with to support the investment of skill development in
the aim of generating a better understanding of the new work teams.
the competitive challenges facing F&PA, as well
Underpinning this whole approach was a
as gaining an understanding of the application
refreshing of the company’s approach to its
of the quality movement’s principles and tools
relationship with its staff. Better than most,

F&PA understood that modern production “...an abiding belief in collectivism
methods required an engaged and knowledgeable through the union/employer contract
workforce. The quality of relationships with as the best means of managing the
staff, suppliers, and customers initiated in the wages and conditions dimension
late 1980s remains a hallmark today for how of the company’s relationship with
F&PA does business: it is an internalised value staff.”
regarded as the glue that holds a complex Senior Manager
business operation together. Associated with
Unions are perceived by the company as a
this value is the clear understanding that, as the
necessary reality.
company gained in scale and complexity, it needed
to develop a leadership model that could create The relationship with the union is viewed as a
a working environment in which people could source of competitive advantage where:
thrive and do their best. • the interests of staff are properly taken care
of
Internally, F&PA makes a point of having a direct
• transaction costs associated with managing
relationship with staff. This is experienced by
employment agreements are rationalised and
staff who speak of their human relationships
• a process of consultation with staff and
with managers on the shop floor using language
unions over change ensures high levels of
such as “friend first” (before communicating
commitment to and successful adoption of
business information). The distinguishing feature
the eventual change.
of F&PA is that this emphasis on a high quality
relationship with staff is experienced by them as In this way, F&PA’s approach to partnership with
something that is genuine and lived, rather than the EPMU is a natural and inseparable outcome
an aspirational value that is paid lip service. of its approach to staff relationships. As one
senior manager expressed it:
Workers are currently organised into “mini-
companies” that have progressively been given
“Our production managers are
greater autonomy to do what is needed (including brought up in a world where
stopping the production line) to ensure that relationships with people, and how
high quality production is delivered on time to they are represented, are key values
customers. One manager explains the process as: that are constantly practised.”
“…changing the company from one The opportunities created by F&PA were
where people are told what to do, to welcomed, in particular, by the EPMU who began
one where people know what to do an era of intense engagement at all levels.
and want to do it.” (During the 1990s, there was simultaneously
top level strategic engagement and senior
In terms of union/management partnership, HR and union specialist engagement, as well
a consequence of this approach to staff as “on the ground” engagement through the
relationships is: local organisers, delegates, and divisional HR
managers.) The EPMU were keen to see the F&PA

“model” succeed, particularly in the Employment concentration of expertise. However, there is a
Contracts Act environment, as an example of feeling in some quarters that it has increased
an alternative approach to industrial relations siloisation, removing engineering and marketing
and organisational change and invested in its specialists, in particular, away from regular union
development via the participation of key officials contact thereby lessening their appreciation of
in a variety of developmental initiatives, as well the partnership relationship and making cross-
as through intensive delegate development. functional conversation and learning more
The union was an active and constructive difficult.
partner, as well as being motivated to learn
Some of the current challenges to partnership
from the experience with the aim of potentially
at F&PA which will be explored later in this case
transferring this learning to other companies.
study may be, in part, an unintended consequence
The foundations laid in the late 1980s bore fruit of this structural change.
during the 1990s (although not uniformly every
Another factor affecting the latest iteration of
year!) when F&PA surged ahead in growth terms
the partnership was the late 1990s retirement
while continuing to build a close and increasingly
of HR Manager, Allan Taylor, and the withdrawal
sophisticated relationship with the unions (which,
of Mike Sweeney from the EPMU (who took on
incidentally, reduced in number from 13 to one
a senior management role in the union) from
over this period under the single composite
the intense engagement that characterised
collective contract). This period was described
the deepening of the partnership relationship
by one senior manager who was at the centre of
throughout the decade.
much of it as:
F&PA today
“…a huge period of magic where we
achieved amazing things together. As already noted, F&PA is today a fully fledged
It was only made possible by the multinational company with growing revenues
creation of the right environment and an established presence in Australia, the US
over a long period of time.” and Europe. The establishment of manufacturing
plants in overseas countries has diluted the
In 1999, under new CE, John Bongard, there was influence of New Zealand based operations
a major restructuring of the whole company across the company, and this may be contributing
away from product aligned divisions to a focus to a lessening of the strategic importance of the
on core businesses of Whiteware, Healthcare, domestic union/management partnership.
and Finance. This had the effect in the Appliances
This is experienced by a convenor of delegates as
business of creating centralised teams in
follows:
marketing, engineering, production and design
(plus HR) rather than having smaller functional
teams for each product. This restructuring has
reduced costs of duplication and heightened the

“It seemed small and intimate here ”F&PA’s point of difference is now
in 1995. As we move to a global scale, shrinking, as it becomes truly
it starts to get out of reach. We notice global and increasingly subject to
the loss of intimacy. The bigger you competitive pressures.”
get, the harder you have to work on
relationships.” F&PA is also experiencing the effects of
significant demographic changes. Migration
Like many other export manufacturers in New patterns in the last decade have slowly altered
Zealand, F&PA is also experiencing the effect of the composition of the workforce towards a
massive economic growth in China in the form of much more multicultural mix, posing challenges
unprecedented rises in commodity prices for raw for effective communication with and between
materials, as well as having margins squeezed staff, as well as for workforce alignment and
on products exported from New Zealand by a homogeneity around company objectives. In
highly valued currency. New Zealand’s very open addition, F&PA has a long-serving workforce with
economy exposes F&PA to intense competitive many of its staff now approaching retirement.
pressure, from which there is no cushioning or Replacing that skill, knowledge, and loyalty base
hiding. in a tight labour market is a major issue for the
As the Union Organiser put it: company.

3. Foundations for Partnership
While the values on which partnership are based “Some of the thinking and
have already been discussed, it is important documentation including aspects
to also look at the artefacts, structures, and of the Collective are outmoded. We
processes that have evolved to serve the need greater flexibility in hours of
relationship. work and to change roles and deploy
staff as needs dictate to improve
Composite Agreement manufacturing efficiency. Some
people in the company are now
As noted above, the negotiation of a single saying that if we cannot afford to
composite agreement in the late 1980s (finally manufacture here we will have to
agreed in 1991) provided the parties with go off-shore. There are a whole lot of
their foundation for modern partnership. things working against us.”
The agreement has evolved over the years to
comprehensively capture all wage classifications, There is no underestimating of the size of the
conditions, skill development arrangements challenge:
and other matters which codify processes for

“The Composite is a bible for the
managing change or disagreement.
relationship so it is a big challenge.
The Composite Agreement (now known as We hope there is enough trust with
the National FPA Collective Agreement) is the union to manage this process
regarded by the union as the cornerstone (of quite a radical reform of the
and formal expression of partnership. Even Agreement). Of key importance is
though it was being finalised as the Employment putting up a good business case.”
Contracts Act was being introduced in the
For the union’s part they are prepared to let
early 1990s, the company stayed with the
the company develop some proposals and build
process despite constant pressure from
a business case for change in the Composite,
the National Government and the Business
although there is a little nervousness that:
Roundtable throughout that decade. This
experience undoubtedly strengthened the
“While there is a need for another
company’s attachment to the Composite and its
mechanism for quick reaction
relationship with the unions as well.
to the realities of whiteware
Now, however, there is considerable pressure manufacturing in a global market,….
emerging from the ranks of senior management is this the thin edge of the wedge (in
to simplify and introduce greater flexibility into the company’s ongoing adjustment
the Composite Agreement. In the words of one to competitive pressure)?”
top level manager: Mike Sweeney

In other words where does it end? Underpinning all of this is a clear understanding
about the primacy of the relationship and a focus
This question is likely to underpin union concerns
on the quality of outcomes that the partnership
with this major project of updating the
can achieve.
Composite.
The main structures that have been confirmed to
Structures and processes – support the relationship are as follows:
the set-up i. Board of Management (BOM) – involving
the GM Appliances, GM Human Resources,
The partners have evolved a number of formal
Site Managers, Union Organiser, Chair and
processes and structures which are designed
Vice Chair of Convenors (of delegates). The
to support and give effect to the relationship.
purpose of this BOM is to meet monthly to
These too have evolved over the years with
discuss and agree on company-wide issues
the most recent iteration following a short
at a strategic level, to enhance union/
(and second only) strike at F&PA in 1999. The
management relations, and to act as a
strike proved to be a traumatic event for the
steering committee for employment relations
company. It spawned a major re-evaluation of the
issues.
partnership aimed at clarifying and consolidating
ii. Local Consultative Meeting – Convenors
the relationship.
(head delegate from each manufacturing
This review confirmed the characteristics of unit) and Area Managers (Operations and
F&PA’s and the EPMU’s partnership, as well as HR) both meet to discuss and agree on local
the structures through which it is exercised. The operational issues. The company leaves it to
formally agreed characteristics are as follows: the union delegates to initiate these meetings
i. “The union is recognised, appropriately which don’t always take place in practice.
resourced, and involved in the company’s iii. Convenors and Organiser – All the Convenors
development. and the Union Organiser meet to discuss
ii. Union members are accepted as stakeholders union business just prior to the BOM referred
in the company with rights, as well as to above. The results of these meetings
responsibilities. are supposed to be fed back to work area
iii. Openness and trust amongst management, delegates.
delegates, and members. iv. The Union Organiser and Chief Executive also
iv. An agreed consultative process is pursued to meet regularly to discuss big picture issues
reach resolution and agreement. and trends.
v. There is an acceptance of the need to change
The purpose of these meetings is to maintain
to ensure the long-term future for both the
a high level overview of company direction and
company and our people.
possible consequences for staff. As noted above,
vi. A culture of quality encompassing our
during the 1990s there was a particularly close
relationships, environment, products,
relationship between the Corporate HR Manager
processes, and customer services.
and the Mike Sweeney. Since one retired and
vii. Members share in the company’s success.”

the other pulled back from direct regular that have been established are designed to
engagement, there has not been the same ensure everybody knows what is going on and
degree of regular high level contact between the that issues are dealt with as close to source as
two parties. This is perceived as having “created possible. The objective is efficiency and clarity in
a gap” in the relationship between the leadership communications and widespread involvement of
of the respective partners in the eyes of a delegates and members.
number of managers:
Accompanying these structures and processes
is a programme of delegate training and
“We need more ‘big picture’ strategic
development. Currently, the EPMU provides its
conversations more regularly and for
own generic in-house training for all delegates.
them to go somewhere!”
This is supplemented by internal F&PA training of
Senior Manager
delegates in the processes particular to F&PA.
This statement reflects a degree of nostalgia However, there is a view from within management
for the quality of relationship enjoyed in the that delegates need more intensive training in
1990s while also affirming that any new high level the fundamentals of conducting partnership
engagement has to lead somewhere. relations than they are currently receiving,
although this is a topic under discussion. The
There is also an agreed process for information
calibre and competency of delegates is an
flows between these different consultative
important issue for the partners to resolve, as
mechanisms to ensure each part is aware of
it goes right to the heart of how partnership is
and ‘talking to’ the others. The key processes
experienced on a day to day basis.

4. Partnership in Action
This section looks at partnership on a day to every aspect of what the company does in its
day basis focusing on the experience of the relationships with staff and the union. This is how
Refrigeration Plant as well as exploring how partnership at F&PA has become the norm and
some of the larger issues have been played out in is fully integrated into the company’s business
an environment of partnership. model:
Day to day “We have formal reviews of

partnership and so on, but F&PA
In the Refrigeration plant there is a weekly
really works by doing it on a daily
meeting of operations managers, an HR advisor,
basis. We don’t save up issues for a
a training specialist, and the Convenor of
meeting or for the negotiations, we
Delegates for the plant to discuss: get on with it, we live it. How we can
• health and safety issues do it better permeates every aspect
• team Leader development of our business. We always ask the
• recruitment union what we can do better, what
• information on production performance we need to achieve.”
• production issues and impacts Manager
• training issues.
Each of these issues is looked at from a variety Attendance Committee

of perspectives. Beyond that, the Convenor deals
As with other F&PA plants, Refrigeration also
with issues as they arise on a daily basis with the
operates an Attendance Committee which
aim being to deal with them at a local level and to
meets monthly, comprises of an area manager,
find out what is behind them to see if there any
a team leader, an HR advisor and a delegate and
system wide issues that need to be addressed.
has responsibility for approving the payment or
This approach to keeping things local is not just
non-payment for unplanned absences, including
about unclogging the system but also about
sports and recreational leave. The interesting
how to:
feature of these committees is that they
operate with a:
“Get ownership at a local level as
we do with quality. We are always
“…grey set of rules which means
asking how can we get people to see
there is quite a bit of flexibility and
the consequences for what they do,
the key challenge is to get some
take responsibility and fix it.”
consistency over time so people know
Manager
where they stand in relation
Here again there is this deliberately chosen to others.”
way of doing business informing and infusing

The goal is to try and achieve a win-win and to Living it
turn people who may be regular “offenders”
Beyond these regular forums: “it’s lots of little
around.
things that make the difference” (Manager), a
A classic case that was quoted concerns one regular feature for workforce communication
employee who was regularly absent on Mondays is the two 10 minute “mini-company” meetings
and Fridays. A proactive investigation into what that take place each week. These short meetings
was stopping him from attending revealed he had discuss a broad range of issues and provide
poor vision and couldn’t see small screw holes yet another forum for two-way company-staff
clearly, especially after several days of straining communication.
his eyes. The company provided him with glasses
From the Convenor’s perspective, the key is in
and six months later he had become a foreman.
recognising that:
“Staff get a clear view of

“Delegates here need to go the extra
expectations from both managers
yard. It’s not just two positions
and the union at the same time so
arguing against each other. There is
they can’t turn around and run to
no room for ‘positional’ here. At the
the union afterwards.”
end of the day, helping to make the
Manager
company work better is all about job
security.”
“The key is to be straight up. We want Convenor
to change behaviour not go down the
disciplinary path” This entails working with other delegates to help
Convenor develop them and constantly trying to steer a
fine line between doing your job as a delegate
The Attendance Committee is also a forum for and not becoming caught up in doing the
coaching new team leaders and delegates in company’s job for them.
what is expected so they can take that learning
into their own day to day activities. The message “Sometimes when you are trying to
picked up by staff and the union is that the help lift quality, you get accused of
company is concerned to have its staff turn up being in the company’s pocket. You
to work fit and healthy and will go out of its way just have to get better at managing
to provide assistance if it’s needed, rather than these tensions as they are a fact of
taking a disciplinary and punishing approach to life.”
attendance. Convenor
The aim of both parties is to reach a state in

which:

“The union and management view “The first thing that struck me
it as our people and our business. We was there was no real tension. The
don’t want the mind-set of ‘you and bosses sat down and listened to the
them’, but ‘I and we.’ The bad times workers.”
are when the manager looks after the
business while the union looks after From the Organiser: “F&PA is an extremely
the people.” honest and open organisation.”
Agreed statement between a manager Communication is not just about managers
and a convenor passing on what the company is thinking and
doing but also about genuinely listening and
From these observations, it is clear to see that
responding to the concerns and ideas of staff.
the relationship:
Delegates are now supplied with mobile phones,
“… takes a lot of guts from both sides. so they can easily get in touch with whomever
We can get caught between the union they need to at short notice.
and the top management team but
we always have to keep working Examples of partnership in action
at it. One team leader, delegate, or
While the day to day practice of partnership at
manager who comes at it differently
F&PA is well ingrained, the real test comes when
can unravel quite a lot. So it’s very
larger scale issues between the parties need to
hard, but history is on our side”
be resolved. A number of examples of “big ticket”
Manager
items are illustrative of the F&PA way.
In recent times, F&PA wished to shorten the

Communicate, communicate
three-week shutdown over Christmas in order to
Several union delegates and the Union Organiser, meet its customer demands on other markets.
from their different perspectives, confirmed They approached the union but, in the words of a
the company’s absolute commitment to full delegate, “didn’t really put up a proper business
communication. One delegate observed that: case.” In combination with the staff’s desire
to spend the usual amount of time with their
“No matter how busy they
families, the “poor” business case was voted
(management) are, they always
down. The following year, a much better prepared
drop what they are doing and pay
management, developed a stronger business
attention when I contact HR. Nothing
case, involved shop floor staff in small groups
hinders communication.”
to come up with options and ended by with a
Convenor
solution that provided for a shorter Christmas
Another who had come from the meat shutdown in return for a “flexi” weeks leave.
processing industry said that on starting at Everyone was satisfied.
F&PA: A further example of partnership in action
concerns the approach the company took to

deal with the loss of production time associated on some dissatisfaction amongst staff to pursue
with the historical practice of a five-minute their own agenda.
wash-up time at the end of the day for all
Another interpretation was that F&PA had
production staff. Managers developed a case
failed to present a good business case for the
which identified the $150,000 per month cost of
changes it was seeking in negotiations in 1998
the practice and invited the union to work out
and had created an environment in which staff
alternatives. After deliberations with members,
dissatisfaction could be exploited. In any event,
the union worked out a solution involving a swap
there was an overwhelming staff vote in favour
between the wash-up time and an extra 2.5 days
of taking strike action on the recommendation of
leave per year (equivalent to the wash-up time
the union’s negotiating committee.
over a year). This win-win also delivered additional
The recollections of a number of delegates and
savings on wasted plastic to the company.
employees coincide with the view that there was
fault on both sides. As it turned out the one-
Strike
day strike took place after the particular issue
Not quite so successful was the trauma of the
at stake had been resolved. No one felt good
one-day strike that took place at F&PA in 1999.
about it and a lot of damage was caused with
Without attempting to traverse the episode
then CEO, Gary Paykel, feeling deeply upset by
in its full complexity it is useful, given F&PA’s
what he saw as a betrayal of trust and a breach
exemplary industrial history, to reflect on
of the relationship. Union representatives and
some of what happened. The one-day strike is
staff, while appreciating the significance of what
regarded by the management in particular as a
happened, appear more sanguine about the affair.
“violent rupture of our relationship.”
The strike spawned a major review and
In brief, the company had been in some economic
refreshment of the partnership that is reflected
difficulty in 1998, and this was reflected in them
in the defining characteristics and revised
“going hard” at the contract negotiations that
structures described in section 3 above. The
year and seeking some “clawbacks” (in the words
lessons to do with developing a sound business
of the delegates). This took the union and staff
case, and patiently communicating and consulting
by surprise and soured the relationship creating
about it, are obvious (see section 6 below for
the environment for the election of a number of
more discussion on the “consultation” issue).
more militant delegates. It also coincided with
However, the experience also raised issues
the appointment of some new (less experienced)
about union processes for electing delegates
area managers.
and holding them to account which a number of
From some managers’ perspective, the strike managers still view as being unresolved.
was a function of the personalities of the two
militant delegates who were “on the warpath.” Skill based pay
This interpretation led to growing frustration at
In the early 1990s, when F&PA’s team based form
the apparent impotence of management in the
of work organisation had been established for
face of a couple of influential delegates trading
a number of years, the EPMU initiated (and the

company willingly participated in) a major project However, the revised system is intended to
aimed at tying a new skill system supporting team address some of these bottlenecks in terms of
based work organisation to the Qualifications new training and assessment processes and a
Framework and linking skills to pay rates. standardised approach to describing and valuing
skills. A noted by the EPMU’s specialist in skills
Five years ago, a joint review process was
based pay systems:
initiated to resolve a number of issues that had
emerged in the initial implementation period.
“It is complex and time-consuming
After some early differences in approach, the
at the front-end but easier to
parties were able to navigate their way through
manage once the system is in place
to a constructive refinement of the system.
and people are educated in how to
It has taken over 10 years for the new skill based use it.”
pay system to be worked through, although it has
not yet been implemented in full. The definition From the perspective of management, the new
and development of skills and qualifications system works well for the most part, although
with associated training packages has for the the whole process is regarded as having taken
most part delivered a “great” system, although a huge effort to complete over too long a
there were differences between the union and timeframe.
the company regarding portability of skills. (The It should be noted that the skills based pay system
union was seeking portability to improve the is comprehensive in that it affects how people are
employability of its members while the company assessed and trained, even influencing how work is
saw its skills development system as a source of set up, as well as how people are paid. As noted by
competitive advantage and also wanted to retain the EPMU official most directly involved:
its staff.)
From the perspective of a number of employees

“It is very much facilitated by the
development and training ethos of
spoken to, the skill based pay system has taken a
F&PA. They have always had an edge
long time to develop but has a distinct up-side:
there.”
“It is too complicated to understand What is noteworthy about this particular

for most people, including team example is both the initiative taken by the union
leaders, and has created a bit of partner to actively contribute to this important
a bottleneck in the system with
area of organisational practice, as well as the
everyone quite quickly getting to
open dialogue processes used to work though
level 3 then stopping. But when guys
complex issues, rather than either party
get their certificates, they feel proud
adopting adversarial negotiating techniques.
that their achievement has been
recognised.”
Shop floor employee

5. Benefits of Partnership
As with much of this story, the words of the Another area manager says:
participants are most illustrative of the benefits
of the partnership at F&PA. “I know it’s a bit of a cliche but we
really do aim to take care of the
Community benefits people and the relationships and
they take care of the business.”
From the perspective of the Union Organiser,
the essence of the partnership is evident in In a joint discussion with a delegate and an area
the F&PA cafeteria where all staff, including manager, they both confirmed that together:
senior managers, mingle and where a good
variety of meals, including healthy options, can “We view it as our people and our
be purchased cheaply. (The cafeteria itself is business.”
a potent symbol of the management/staff
There is no doubt in the minds (and actions)
partnership. Prior to the late 1970s, the company
of successive generations of F&PA managers
had operated separate dining rooms for shop
that the pathway they have chosen doesn’t
floor staff and managers.)
just make ethical sense, but it also makes good
“This area is a hub for East Tamaki. business sense. A motivated and empowered
Everyone gravitates here; there workforce and a constructive union presence
is lots of social interaction that have contributed significantly to productivity
has implications for the broader improvement over many years. The willingness of
community, as well as for F&PA. It’s employees to initiate improvements, undertake
the heart of F&PA.” necessary change, and provide that extra effort
when called upon is regarded as a source of
competitive advantage.
Management perspective
An HR manager talks of the partnership as
Union perspective
having:
The union clearly has been given, and takes
“…achieved an open respectful responsibility for, its stake in the business. Over
relationship that enables us to get the decades, the EPMU has not simply been
our business needs discussed and a passenger confining itself to responding to
understood, so we can move forward management initiatives, but it has also actively
together as quickly as we can.” invested its own ideas and energy into creating
a successful organisation that works at multiple
levels for its members and the company.
The consequence of this, together with the

enormous effort the company has invested in communicate fully with them on business issues
both its direct relationship with staff and in good has its pay-off in the form of a long-serving and
participative management practices and work loyal staff who understand the business and
organisation, is that: their own contribution to it. There is a sense
of comfort in knowing that there are workable
“Most of the guys focus on making structures for union/management dialogue and
the business function better, rather problem-solving which are apparent on a daily
than wasting energy on picky fights basis through the activities of delegates, even
over entitlements or claims.” though for many the union is regarded as a last
Convenor resort to be called in when things go wrong:
An outstanding example of this attitude in

“There is a good structure here for
practice was illustrated when the company
listening to and hearing each other.
needed to increase production by 200 dryer units
The managers get good morale by
per day to cope with demand. A brief was given to
working with the people at their
a leader of 60 staff in the dryer production area, level. We are aware of how real and
and together the leader and the workers came close global competition is to us.
up with a solution that involved them working on We have a real pride in working for
both sides of the production line enabling them F&PA. The name means something:
to double production. The only cost associated a lifetime job and being well looked
with this redesign was $400 for new rubber mats after. We do innovation that takes on
to stop people from slipping. the world.
In addition, F&PA has provided the EPMU with
a living and workable example of what genuine “If you understand where you come
partnership can deliver. Its members are from and where you are going you
respected, well treated, and have better than get that voluntary effort. Plus we
average wages and conditions. They are also know we belong.”
involved in decision-making and contributing Comments from shop floor staff
ideas about how to make the company work

There is a good deal of pride associated with
better for everyone’s benefit. This is invaluable to
working for F&PA that comes from “being part of
the EPMU as they talk to other companies about
a good company making good products,” as well
alternative ways of operating. The union is also
as “when you see the products in the shop, you
treated with respect and valued as a legitimate
know what you contributed to it.”
partner and for the contribution they make to
the business. That kind of pride in the quality of the product,
a sense of identity and belonging leading to
The workers’ view voluntary effort, and staff loyalty contribute

hugely to workplace productivity. It also makes
The willingness of the company to take its
F&PA a good place to work and be.
staff and their union very seriously and to

6. Challenges and Dilemmas for Partnership
This section focuses on the major challenges for the point of origin. However, a lot of background
the parties involved in partnership at F&PA. work goes on between the Convenor and the HR
Managers to get delegates up to speed.
Structures and processes – in Another source of frustration for managers
practice relates to situations where less experienced
In practice, the structures, processes, and delegates automatically take the part of a
communication flows do not always work as worker who is being disciplined when that worker
intended with many of the bigger issues and is clearly in the wrong.
deals: “being discussed between the Convenors
and senior managers before being taken to the “Delegates often adopt a defensive
members for endorsement.” One HR manager stance and don’t seem prepared to
expressed the view that: stand up and lead from the front.”
Manager
“We would like to see the more active
This is seen by the company as unprofessional
involvement of other delegates
behaviour and a source of concern, especially
working with managers on business
issues and coming up with agreed when the union leadership is perceived as taking
solutions (rather than it being no particular responsibility for ensuring that
confined to the few).” delegates are equipped to fulfil their roles, and
that they act in accordance with the spirit of
This observation alludes to a broader issue the partnership. It is also seen as a shortfall in
affecting workplace relationships that includes the effectiveness of delegate training. However,
the capability (and effectiveness of delegate a lot of work involving the HR Advisors and the
training) and personalities of both delegates Convenors goes on behind the scenes aimed
and some managers. Both parties noted that at getting newer delegates up to speed. There
the calibre of each other’s representatives was is some frustration amongst managers that
critically important to determining the quality delegates turnover at a rapid rate. Just when
of engagement and, ultimately, that of the one seems to be getting familiar with the
relationship. For example, a number of managers requirements of the job, they quit (or in some
attributed at least part of the cause of the 1999 cases get promoted by the company) or are
strike to the “attitude and agenda” of two key voted out at elections held every three years.
delegates at the time. As noted above, they also
For the union’s part, there was some frustration
bemoaned the lack of training of some delegates
that things always seemed to go wrong when
noting that sometimes issues were escalated to a
short cuts were taken by managers in a hurry
higher level before being properly attended to at
who were not prepared to develop a sound

business case and take it through a robust to the captain. We don’t need the
process of consultation. There was also concern union on a day to day basis because
when some managers, especially new ones, tried we use each other. The union is the
to do things differently in a “non F&PA way,” last resort. If things need to change,
thereby diluting the culture of partnership. the good thing about the company
is that everyone comes together in
These reported hiccups, at the very least, a meeting to learn what is going on
illustrate the limits of agreements, structures, and work out what to do. ”
and processes in delivering a relationship that
works. While such instruments represent a However, given the effort that goes into
determined effort to “design out” the effect of designing and maintaining these relationships,
inconsistent and volatile human behaviour, they and that F&PA places great store on the
cannot always overcome the behaviour adopted principle of continuous improvement and has
by people with a different agenda. a desire to improve performance at every
opportunity, there is a level of frustration when
However, underpinning these concerns from the
one party is perceived as not quite pulling its
company’s standpoint is the fact that F&PA have
weight. As one manager put it:
deliberately integrated the union/management
relationship into the formal management
“The structures are there to keep
structures of the company, rather than running
issues in perspective and not clog up
a parallel structure of secondary importance
the system. Poorly trained delegates
to the mainstream business structures.
who elevate issues too quickly or take
Furthermore, as already observed, they talk of a: the easy option cause frustration
and undermine the system.”
“…triangulated relationship between
union, staff, and management F&PA managers do not like inefficiency or
with each group having a distinct sloppiness. They expect all elements of the
relationship with the other.” business, including external stakeholders, to be
up to the mark.
This three-way relationship has worked well
for all concerned over the years and implies Another observation from an HR manager about
a high degree of trust amongst the parties. the damage caused by misuse of the systems
For example, the union is comfortable with and processes through which partnership are
management talking directly to staff because mediated, notes:
they trust the company and vice-versa. Staff, for
their part, note that: “I have no time for delegates who
defend people they know to be in the
“Everyone is a union member and wrong. It has the effect of reducing
everyone is a team member. It’s like our willingness to co-operate and
a rugby team – you talk to the player share information which is very
next to you, rather than always going undermining of what we are trying
to do here.”

However, there is also some appreciation of constructive approaches to employment issues
the difficult position that delegates can find while simultaneously faced with vocal segments
themselves in: of a workforce that don’t have the patience
to listen to explanations about due process or
“The problem is that delegates are are distrustful of delegates who may have been
often torn and then take the easy provided with more confidential information
way out rather than put their butts on an issue than is generally available. Union
on the line.” representatives are expected to both engage
HR Manager in constructive dialogue, as well as staunchly
defend their members’ interests.
Union perspective Nevertheless, both delegates and managers
Of course, for the delegates and the union noted that where there is some dissatisfaction
officials there is a delicate balance to be struck. about delegates getting too close to the
While the union trusts the company, they can not company, there has sometimes been a change in
afford to be seen by their members as being “in personnel at election time in favour of someone
the boss’s pocket.” Meetings behind closed doors, who may take a more traditional view. As one
being seen to side with the company, rather than former delegate noted:
a worker who is being disciplined and reinforcing
the company’s position on most issues, can and “The longer you are a delegate the
have led to charges of co-option from some more you see things from both sides.
quarters. However, this perspective is not always That’s when you get tossed.”
universally held amongst the workforce. For
example, some of the shop floor staff interviewed Where philosophy meets business
demonstrated a sophisticated appreciation of pragmatism
what is at stake when they observed:
At the end of the day, however, the company
understands that:
“You can ruin it for others if you are
fighting for the wrong reasons (in
“Union representation is a reality
reference to the example of delegates
for shop floor staff, therefore, there
taking the part of a worker who is
is little risk of taking it away as it
clearly in the wrong). People on the
would de-stabilise staff/management
floor expect something straight away
relationships. Overall, there is
and if they don’t get it, they start to
some frustration and we have our
blame the delegate. People who have
moments, but good relations are in
a negative attitude or are too afraid
our best long-term interest. A good
to ask, or too shy, are the ones who
relationship with the union pays
criticise the union.”
dividends.”
These comments highlight the fine line HR Manager
that unions need to walk when engaging in

Or, as another HR manager put it: Nevertheless, the structures, processes, and
training that have been put in place to facilitate
“The rationale is that people work the management of the relationship are of real
better if they are not p…d off with importance, and both parties need to continue
you and are happy.” to invest in making them work well. Inattention
to good process or taking the easy way out can
Ultimately, this is the hard-nosed business
easily lead to an undermining of confidence in the
reason for F&PA pursuing partnership with
partnership and a damaging loss of respect.
its staff and the EPMU so vigorously, as well
as echoing the philosophy of the company’s
Consultation at F&PA – unbundled
founders.
Consultation at F&PA means more than it
“It’s in our interests to do it this way. does in many other workplaces. It’s a way of
We need to know and understand life, but it also brings its challenges and these
our people so they stay. Loyalty is are becoming more apparent as competitive
important. This is a hard business pressures on the business grow.
reality, not just “being nice.”
All this structure and attention to
Manager
communication requires a tremendous effort in
While structures and processes may not always terms of the time and resource that it takes. At
be properly used or adhered to, or while some times, there are varying degrees of frustration
participants may not live up to the standards in some quarters within management about how
expected of them, sitting underneath all of this long it takes to keep everyone informed and
is the essence of the F&PA/EPMU partnership. It to see the union’s processes of consultation
is the less tangible elements of deeply ingrained through to completion. Most managers
organisational culture and values that provide acknowledge the reasons for such a rigorous
the real glue that holds the F&PA partnership process and see the longer-term pay-off for the
together. In the words of the Union Organiser: company in terms of staff buy-in. However, there
are growing signs of frustration over different
“F&PA is an extremely honest aspects of the consultative process that pose
organisation. If the boss says or tells real challenges for partnership.
me something, I take it as a given. At one level, particularly within senior
Likewise, they can trust what
management which is more removed from
I say. We don’t want to breach that
the day-to day practice of partnership in the
trust or it’s gone.”
workplace, there is concern that the harsh
In the words of a senior HR manager: competitive realities facing F&PA require greater
flexibility and speedier responses than the
“Ultimately, you have to believe in current consultative mechanisms appear to
the importance of loyalty, trust, and allow. Yet there is also the realisation, particularly
relationships.” at an operational level, that if the company

doesn’t consult fully, it will end up taking longer decision to do something different and then
to get through any change: having to consult about how that will be achieved,
rather than whether it will or not. However,
“When you try and take a short cut it there was some evidence of frustration within
ends up taking longer.” management when the union appears to want to
Manager exercise a veto.
One convenor, when faced with a question The issue of consultation runs even deeper
about company concerns about how long the within F&PA management at present:
consultation process takes, noted:
“While acknowledging that the union
“If the company has a good case can facilitate good business practice,
and do a good process, 8 times out there is too much prescription in
of 10, they will get our support and the relationship. For example, when
agreement, but if they don’t, they going for the 24x7 shift arrangement
won’t. For example, sometimes across two sites, there was a huge
they haven’t put all their cards on investment to get a common
the table to justify why they want solution. It was very protracted and
something. That just slows things process heavy and ultimately very
down. Some Managers have ideas costly (even though we agreed to
for change but haven’t thought them it). There is growing pressure from
through. Others are brilliant at it. the Board and from some in senior
For example, when they wanted to management to simplify things with
change the Christmas shutdown some even saying maybe the union
at Refrigeration from three to two won’t be such a key relationship in
weeks one year, they didn’t put up a the future. It’s self-fulfilling to say the
good case and got voted down. The union won’t be a key relationship,
following year, when they wanted because then you won’t invest quite
the same thing, they used a good so much into it.
process and got the vote.”
“There is some danger in over
So, a good business case and a good process go
simplifying this, particularly from
some non-production managers
a long way. The difficulty though is two-fold: some
who are removed from the coalface.
within management still feel the price and time
This is one of the downsides of our
taken to achieve required changes, especially in
centralisation with some managers
matters such as hours of work or shutdowns, is
now being quite remote. The key to
too much; others are concerned that the union our success as a company is our
as it currently operates can effectively veto ability to work with people and build
a management decision. On the latter issue, a business around our relationships.
however, most managers spoken to are able We still have to put a strong case
to distinguish between the company making a together, to consult, and invest time

and effort to avoid a relationship “If you (the union) want F&PA
breakdown. to work, you have to invest your
resources, your best people, and
“However, while the company has ideas. You also have to walk the talk.
a mindset focused on streamlining It’s not just about maintaining the
and improving things, the union is status quo.”
stuck in a model that says, ‘this is Senior Manager
what the guys want.’ It would be
good to see the union trying harder Another senior manager noted:
to make it work better. The nature
of partnership is that you have to “Currently we get by. As F&PA
show willingness and be committed has spread geographically the
to change. We don’t see the EPMU importance of the relationship has
investing in improvement. We don’t become less critical. Furthermore,
see enough of the union’s senior the union needs to show F&PA
leadership meeting with our CEO that it understands the company’s
or things like the union conducting competitive issues and can convey
a performance review of their that understanding to its members
delegates.” and to Government as well as add
Manager value to what we are doing.”
However, there are some differences in These latter comments clearly encapsulate what
perspective between some managers, and the the company is seeking from partnership with
Convenors and Union Organiser who think things the union: understanding the company’s business
are better than they have been for a while (at realities and translating that into constructive
least since the strike). actions at a variety of levels, including the shop
floor.
“While the last three years have been
However, a senior union leader also expressed
the best in stability terms, issues do
criticism of management’s contribution to this
tend to come to the fore when the
business is under pressure.” set of issues by observing that:
Union Organiser
“Sometimes F&PA senior managers
While this may be true at an operational level, it are too slow in coming up with
is not necessarily the perception at more senior proactive proposals that anticipate
levels of management. Quite strong criticism of change rather than just reacting to
the union around the themes identified above it.”
was quite frequently expressed.
Apart from concerns about the “document base”
(Collective Agreement) being too rigid, there is
a real and widely expressed concern about the
need for:

“…more active engagement with “If the partnership has to change,
senior leadership of the union so both parties need to change and get
they can understand our need for better, together. We can’t afford for
change.” one party to fall behind.”
Senior Manager
This is echoed by the words of a senior manager
Of course, F&PA is subject to scrutiny from who observed:
market analysts, as well as the disciplines of
competitive markets, while the union can (but “The fundamentals of the
doesn’t necessarily always) focus primarily relationship with the union haven’t
on satisfying its members in an otherwise changed to keep pace with business
uncontested space. This difference alone realities. Some managers are saying
may account for different worldviews and the consultation process is too slow
expectations on the part of each partner which
and cannot cope with rapid change.
F&PA doesn’t like bureaucracy.”
makes reconciliation of distinct interests a
challenge requiring constant attention. Taken together, the issues to do with the need
for greater levels of senior level engagement
Staying on the pace and an ability to modernise the partnership
Over many years, the partnership has evolved processes to better cope with the pressures of
to meet changing circumstances and realities. achieving greater responsiveness to competition
However, these new competitive challenges, add up to a significant challenge for the partners.
together with management concerns that For F&PA, they face the dilemma of maintaining
the partnership as presently constituted is at a competitive edge, while still wanting to live out
least considerably challenged in rising to meet values built on strong relationships that take
emerging threats, highlight the importance real time and effort to nurture. For the union,
of paying constant attention to how the the dilemma is in responding appropriately to a
relationship evolves. There is evidence of a form of change that isn’t particularly welcome or
growing perception within the organisation that likely to be popular with members.
the thinking and practice of the two partners
has slipped out of alignment. Complacency or “We recognise the need for change,
excessive comfort with the status quo can lead but people don’t want to be moved
to the partners developing unevenly. Ultimately, out of their comfort zones, especially
that can lead to misunderstanding, impatience as things seem to be moving along
nicely. But we see the bigger picture
with each other, and the temptation to follow
and want that to be explained to the
different pathways to the detriment of the
rank and file.”
relationship. As noted by a shop floor worker:
Convenor

From the point of view of the EPMU leadership, some appreciation of this; the company also
there is an appreciation of the competitive realises how fundamentally important it is to
realities facing F&PA and a willingness to explore consult properly and keep faith with its proven
more flexible approaches: partnership approach while also having to do
what is necessary to successfully survive in a
“In the 1990s, the union argued world economy that has seen its competitive
that a good contract provides a edge being eroded. The challenge is to find a way
secure base for good productive through this dilemma through a full refreshment
work. However, F&PA is under of the relationship starting at the highest level.
more pressure as it gets harder to
retain an edge in an increasingly While these views represent thinking about
competitive world. So, maybe there current issues, they don’t capture the full range
needs to be a more flexible approach; and complexity of the relationship and need to
something from outside the square. be put into a wider perspective. Nevertheless,
We need to work on an approach they are critically important challenges. However,
and frame it up properly so we the response of Mike Sweeney provides some
can have an informed debate with optimism and points to a potential way forward
delegates and members. How can we for the partners to explore as they come to grips
make the model more relevant and with the realities of modern manufacturing from
attractive, so that a good modern within New Zealand.
manufacturer can succeed in the
Senior Managers within the company, despite
global economy?”
their frustration, also understand the real value
Mike Sweeney
of the partnership to their business:
Sweeney also acknowledges the need to refresh
the overall relationship: “The union can facilitate good
business practice, so F&PA is
“It’s been more than two years since supportive of a successful union
we had our last philosophical session relationship.”
with the senior leadership of F&PA.” Senior Manager
However, the union does not “want to throw out There is some impetus for moving forward,
the baby with the bath water.” refreshing, and modernising the relationship.
The dilemma for the partnership is that The refreshment needs to involve at least:
company requirements for greater speed • a re-engagement between the leadership
and responsiveness to competitive pressures of the two institutional partners focused
don’t sit well with established processes of on updating each other on their respective
consultation and people’s need to come to an realities
understanding of the need for change over time
(or where business realities butt up against
human needs and preferences). The union shows

• a redefinition of and commitment to the key A successful refreshment of the relationship
high level principles of modern partnership calls for a lot of courage, innovation, and a
at F&PA capable of responding to emerging mature and responsible approach from both
realities parties keeping faith with their core values. If
• a translation of those principles into a new anyone can pull it off, F&PA and the EPMU can,
work programme which responds to the real so long as they remember the essence of their
needs of each partner, including redesigning relationship and how they got to where they are
delegate development programmes to meet today.
new requirements.

7. Critical Success Factors
From the evidence that has been gathered the high degree of trust and high expectations
during this snapshot case study, the critical that each party has of the other. It is also
success factors for partnership between F&PA pragmatic as the union contributes significantly
and the EPMU appear to be as follows: to legitimising decision-making, after proper
consultation, which helps to ensure a high degree
Values and philosophy base of acceptability for what is finally agreed.
Underpinning the company’s approach are

several generations of enlightened management
Commitment to each other’s success
informed by a humanist philosophy of genuine Everything the partners do starts from
concern and respect for the contribution and the premise that they value the other and
welfare of staff, both individually and collectively. support each other’s success. They recognise
This ethos translates into placing a huge value and respect each other’s legitimate role and
on the importance of relationships with both contribution. They also support each other
staff and their representatives. Respect for in exercising that role. The company actively
staff extends to recognising their right to an enables the union to fully consult with its
independent and collective voice. The union is members. The union supports company initiatives
perceived as an organisation that represents to make change once a good business case
the collective interests of the company’s has been made and helps to implement that
staff. Maintaining good relationships with all change with a minimum of fuss once it has been
stakeholders is an unshakeable belief that confirmed.
provides the glue that holds all the other
productivity and performance drivers together. High performance culture
A further dimension to the values and philosophy
Three-way relationship base is the company’s wholehearted adoption
F&PA has a deliberate policy of maintaining a of a culture of continuous improvement and
direct and separate relationship with its staff, teamwork which permeates their approach to
including the union delegates, as well as with the everything in the business, including workplace
union, rather than mediating everything through relationships. F&PA have developed and practice
the external union or just dealing directly with their own particular version of this philosophy
staff. While the partnership is between the two which is enhanced by kiwi values such as
organisations, the existence of a distinct third informality, a degree of irreverence, and a quest
party in the form of staff is a distinguishing for innovation. The resulting mix creates a unique
feature of the F&PA partnership. That this culture of excellence within which everyone
triangulated model works is a testament to seems at ease.

Live it daily business. It also ensures that all the parts of the
organisation are connected and talking to each
F&PA and the EMPU simply get on with having a
other.
constructive approach to the full range of issues
they encounter on a daily basis. They don’t save
Openness and communication
up issues or harbour little resentments for which
they might later seek some kind of revenge. They F&PA has always practised a “no-surprises”
constantly communicate with each other with and open information approach to sharing
the aim of working on the little frustrations, information with both staff and union
so they don’t accumulate and blow out of all representatives, although this is now a little
proportion. They don’t make a big fuss about constrained by NZ Stock Exchange rules. Shop
partnership either; instead they just live it. floor staff knowledge about the state of the
company and its products, the challenges it
Longevity and continuity of faces, etc is impressive.
management The key method to which both parties subscribe
F&PA’s approach makes people want to stay is a huge commitment to talk things through in
working for them. A “strategic majority” of full, so there is real clarity about the company’s
managers and staff have been with the company intentions and reasons for change. Early warning
for many years. This means that, over time, of any impending change creates space to
people become deeply immersed in the company’s genuinely listen to the “workers’ voice” and
organisational culture. F&PA is not bedevilled by consider alternatives. Developing a sound
continuous changes in senior leadership which business case for making a change and talking
often bring sharp shifts in direction. New staff, it through fully with union representatives and
at all levels, are encultured reasonably quickly. staff is almost always a recipe for securing
Low turnover at all levels also says something agreement and co-operation in achieving change.
about the company being a good place to work Failure to deliver on this ingrained expectation
and to advance a career. (including being too hasty) can and has led to
problems.
Integration of partnership into
management structures Responsibility model
Partnership isn’t an add-on to the company’s As a consequence of the respect that is paid
structures and processes running in parallel by F&PA to its staff and the union, the company
with the ‘real’ business. Instead, partnership treats people as responsible adults who have
is integrated into management structures both rights and obligations:
and processes: it is part of the company’s
architecture. “Mainstreaming” partnership in this
way elevates its status within the company, as
well as ensuring it is an integral part of everyday

“It’s an adult relationship. The union The clear implication is that it is not OK to take
has the opportunity and the choice the relationship for granted or to be in cruise
about influencing decisions as the mode:
shop floor staff. The offer is: ‘here is
what we are here to do, and we want “The company needs and wants your
you to contribute and to improve contribution and is providing a real
with us.’” opportunity for you to be proactive.”
Senior Manager Senior Manager

8. Reflections, Conclusions
In essence, the F&PA and EPMU model of within management perceive the union as falling
partnership is a very mature and highly developed off the pace in terms of being able to offer the
one. There is a strong ethical and belief base to degree of flexibility and responsiveness, in terms
it, as well as a rigorous set of business disciplines of the base collective agreement and good
that together have become deeply ingrained process, that they believe is required to deal with
into the organisational culture that underpins competitive pressures.
everything that takes place.
It needs to be remembered that the union/
The EPMU has also made a significant and long- management interface usually represents the
term contribution to this partnership. sharp end of workplace relationships, and there
will always be some differences in perspective,
Both parties also have clear and sound
goals, and methods as each party responds to
“business” reasons for engaging in this
its respective constituency. Management will
partnership and believe in it as both a smart and
constantly struggle to come to terms with the
humane way to live and work.
processes used by unions to conduct their end
There is a palpable sense of something special
of the business. Nevertheless, it is clear that
and rare having been created at F&PA. Managers,
the union needs to face up to and focus its
staff, and the union have found some very
attention and resources on how it can respond
effective ways of doing business and working
to the challenges facing the partnership. The
together to create a successful and healthy
EPMU ultimately needs to adapt to changing
workplace that people enjoy being a part of.
circumstances at F&PA, even if they are not
The partnership faces some significant particularly welcome. As noted by a convenor:
challenges. As F&PA expands globally, and
competitive pressures make manufacturing “We don’t want to see this go: it’s
from New Zealand even tougher, the overall precious.”
importance to the company of this particular
The good news is that both partners have a
relationship is diluted. This is further
long and rich vein of experience to draw upon
compounded by a growing separation of senior
in dealing with current issues and remain
managers from the everyday realities and
committed to each other’s success. Partnership
benefits of workplace based partnership. At the
at F&PA is a living thing that is deeply ingrained.
same time, the partnership, in certain respects
It is also an adult relationship founded on mutual
at least, has been left to drift a little.
responsibility. The prospects of renewing the
This combination of circumstances has created partnership to meet today’s challenges look
some disconnection within the partnership. Some promising.

Appendix: List of Interviewees
Fisher & Paykel Appliances: EPMU:

Alison Brown, HR Operations Manager Pio Manuel, Convenor of Delegates, Refrigeration
Kim Parkes, HR Manager, Auckland Site New Mer Grainer, Head Convenor of Delegates
Zealand Neal Saxon, Deputy Head Convenor
Brian Nowell, General Manager, Customer Frankie Tuala, Union Member
Services, Quality, and Corporate Communications Lance Rakuraku, Union Member
Alan McArdle, Site Manager, Auckland Albert Shepherd, Union Member
John Wardrop, General Manager HR and Mike Sweeney, Regional Secretary, (at time of
Operations interview) EPMU
Gill Clarke, HR Advisor, Refrigeration Maurice Davis, Organiser
Anthony Belsham, Operations Manager, Rosalie Webster, Assistant National Secretary
Refrigeration
Rani Brown, HR Advisor

Workplace partnerships can The Centre’s services also include:
help build quality relationships • Providing information on partnership
which lead to more effective and • Supporting capability development for managers,
fulfilling workplaces and better union officials and delegates at different stages/
business performance. The levels of partnership
Partnership Resource Centre • Developing, delivering, and disseminating specific
is responsible for fostering resource and training materials, case studies, and
such partnerships. It works other tools to support partnership approaches
with employers and unions to • Providing opportunities for shared learning and
develop co-operative workplaces networking for managers and unionists involved in
which focus on working towards partnership initiatives
meeting agreed and mutually • Providing expert facilitative support at more
beneficial objectives. advanced stages of partnership development or
The purpose of this occasional where obstacles have been encountered
paper series is to provide case • Offering training in improving interpersonal and
studies and other publications organisational processes, such as conflict resolution
to promote best practice and and business analysis
share experience in partnership • Providing expertise in organisation development and
approaches. change management.

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FISHER & PAYKEL WITH THE EPMU

A CASE STUDY IN MANAGEMENT/

A Case Study Commissioned by the

PRC case study series no. 3

The views expressed in this occasional paper

Partnership Resource Centre,

2 PRC Case Study Series No.3

1. Introduction and Purpose................................ 4 6. Challenges and Dilemmas for

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Purpose “If you want to know how capital

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Emergence of ‘modern’ partnership “We are up against stiff competition.

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conditions, skill development arrangements challenge:

and other matters which codify processes for

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Day to day “We have formal reviews of

Each of these issues is looked at from a variety Attendance Committee

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“Staff get a clear view of

The aim of both parties is to reach a state in

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In recent times, F&PA wished to shorten the

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From the perspective of a number of employees

“It is too complicated to understand What is noteworthy about this particular

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An outstanding example of this attitude in

ideas about how to make the company work

The workers’ view voluntary effort, and staff loyalty contribute

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Underpinning the company’s approach are

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Fisher & Paykel Appliances: EPMU:

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1. Introduction and Purpose................................ 4 6. Challenges and Dilemmas for