The Rise and Decline of Labor-Management Cooperation: Lessons from Health Care in the Twin Cities

Abstract

Labor-management cooperation has been regarded for many years as a panacea for organizations' competitive woes. The academic and popular presses have lauded the joint efforts of companies and their unionized workforces to come together to solve companies' competitive problems while saving employees' jobs. Moreover, research on and examples of labor-management cooperation have found that through joint efforts, unions and firms can improve organizational performance and employee outcomes. Increasingly, however, it appears that cooperation is often but a short-lived phenomenon. This article examines a major initiative of labor-management cooperation that was undertaken to facilitate the fundamental restructuring of the health care delivery system in Minneapolis/St. Paul, Minnesota. For 10 years, management of more than a dozen hospitals and representatives of the Minnesota Nurses' Association came together to negotiate and manage the process of system integration, rationalization, and delivery improvement. The results were remarkable. Yet, just a few years later, despite the success, only remnants of labor-management cooperation remain in these hospitals. This article examines the reasons for cooperation's demise and provides lessons for those engaged in cooperative undertakings that may help extend the life of those initiatives.