HR Lessons from the NHL Lockout

As longtime hockey fans and ticket holders of the Vancouver Canucks for over 10 years, we have been closely following the latest round of collective bargaining between the National Hockey League (NHL) and the National Hockey League Players’ Association (NHLPA), and the resulting lockout, the third NHL lockout since 1994.

The intense media coverage, fan response, and the impact on the employment of the players and workforces of the NHL and its teams highlight some critical lessons for all businesses on how to effectively manage employee and labour relations disputes.

“The NHL and the NHLPA are setting an example for what not to do to resolve a workplace dispute,” says Andreas Hesse of Vancouver-based Clear HR Consulting. “They’re breaking all the rules in how to effectively negotiate and reach an amicable resolution. They’re bargaining in the media, they’re entrenching their positions publically, and the NHL is using a lockout as a weapon far too early in the bargaining process to impact the NHLPA’s position.”

We thought we’d take the opportunity to glean some key HR lessons that businesses can learn from the latest NHL lockout, so as to avoid costly and time-consuming mistakes:

1. Keep workplace disputes internal, rather than wage war through the media

When negotiations are played out in the media, instead of between the actual parties to the dispute, unnecessary time, money and energy are put towards posturing to the media to justify why your position is the “right” one. Disputes with intense media coverage result in significant resource commitments in “spinning” the message to the public, as well as to clients, suppliers and staff. This often results in misunderstandings which entrench and harden positions, and make resolving the dispute more difficult. All the time spent dealing with the media also takes away resources from running your core business.

2. Evaluate the impact of the dispute on employees, customers, suppliers and other business partners

Workplace disputes can negatively impact your marketing and employment brand in a significant way. Customers and suppliers can all reevaluate whether they want to continue to associate themselves with your brand and may choose to end their business relationship with you.

From an employee perspective, the perception of the company as a desirable place to work may also be negatively impacted if the dispute remains unresolved. This can hurt your ability to attract and retain talent. Of course, workplace morale will also be impacted when disputes lead to layoffs or reduced workweeks and associated paycuts, such as what is occurring at the NHL head office and at some of the NHL teams. Consider the impact of the dispute not only on current employees, customers and suppliers, but also on future ones – will they want to do business with you or work for you? It is best to do a cost-benefit analysis considering these impacts prior to engaging in a major dispute.

3. Communicate with the other party to resolve the dispute

In our experience of being part of collective bargaining negotiations and working to settle other workplace conflicts, we’ve never seen a dispute resolved without dialogue between the parties to solve the underlying problem. Instead of focusing on public relations efforts and external posturing, attention should be spent on talking with the other side behind closed doors, understanding the problems and issues each side faces, and determining where common ground can be found.

4. Consider other options to resolve the dispute

Prior to using weapons like a lockout, lawsuit or legal injunction which can have serious negative impacts on your relationship with the other party to the dispute, as well as with employees, clients and other business relationships, consider what other options can be taken. For example, using the services of a skilled mediator and/or arbitrator can help resolve disputes, while keeping the matter out of the media and public records.

5. Focus on the big picture – review your business strategy

Before seeking to enforce major cuts to staff numbers or payroll, consider whether the issue is truly how much is spent on payroll, or whether there are more systemic business strategic issues at play. Is your business operating in the right markets where there is a sustained and profitable demand for your offerings? Do some of your operations or franchisees, in the NHL’s case, have the necessary leadership and management skills to successfully run an operation? Do certain product lines, service packages, or geographic regions need to be reconsidered to maintain long-time profitability? Employees will want to know that the business strategy is sound and management is taking corrective measures before they’re willing to continually bear the brunt of cost-cutting.

We hope that the NHL and NHLPA will quickly resolve their differences. While we wait, the latest NHL lockout provides many HR lessons from which all businesses can learn.