The Transformative Capabilities of Mediation on Strenuous Labor-Management Relation: An Exploratory Case Study within the Telecommunications Sector in an Emerging Economy

Abstract

This paper examines how and why a mediation process may transform an antagonistic labor-management relation, in two post-privatized telecommunications companies in an emerging economy, and make it evolve from severe confrontation to responsive collaboration. We deem that the analysis of such process allows gaining a better understanding of the positive impact that frank dialogue and trust may have on an organizational conflict, even when the prevalent social and political context, present in a good number of the Latin American countries, encourages labor-management altercations (Reade & Reade McKenna, 2009). After a decade of structural reforms that dismantled the state-owned economic apparatus, social turmoil, economic depression and extreme political weakness led, by the end of 2001, the Argentinean government to collapse. A new government, inaugurated in 2003, proclaimed the instatement of a new policy of wealth distribution guided by equity that eased the access to power within their organizations to the most combative union members and, consequently, made labor-management conflicts proliferate. After a tumultuous episode in 2004, both Telefonica de Argentina’s (TASA) and Telecom de Argentina’s (TECO) management and the Federacion de Obreros y Empleados Telefonicos de la Republica Argentina – Sindicato Buenos Aires’ (FOETRA-BA) leadership agreed to carry out a mediation process seeking to transform their unproductive confrontation into fruitful collaboration without relinquishing their respective interests. The contribution of this exploratory case study is the exposure of the transformative capabilities of a mediation process on a previously strenuous labor-management relation.