Firms with high fixed costs have major overheads - overheads are monthly expenses, such as rent, mortgages, fuel, cars and trucks, outsourced cleaning staff, and a range of other expensive monthly items and services.
For firms that are under pressure to earn enough to cover high monthly expenses, a potential strike can be financially disastrous. This type of company will usually scramble to resolve matters before employees walk out, depriving the company of the labor they need to produce goods and services, and make enough money to pay the bills and, hopefully, turn a profit.
Every Strike Situation Is Different
In the past, unions were necessary to secure worker's basic rights to a decent living. Today, unions have expanded their focus to fight for a series of extra rights and services for their members.
For firms that are under pressure to earn enough to cover high monthly expenses, a potential strike can be financially disastrous. This type of company will usually scramble to resolve matters before employees walk out, depriving the company of the labor they need to produce goods and services, and make enough money to pay the bills and, hopefully, turn a profit.
Every Strike Situation Is Different
- Companies with lower overheads will be less inclined to roll over for employees during a strike, and to cave into their demands. However, neither scenario is a guarantee of what will happen when regular staff threatens to strike. Each situation will be different; in situations where management feels that staff is already handsomely compensated for their services, management may simply refuse to give out more money and benefits to their employees, regardless of monthly overheads and other financial concerns.
- Sometimes, companies have enough money to ride out strikes, without wavering in their position to refuse increases that striking staff is demanding. Often, these situations will deteriorate, until arbitration is necessary. In binding arbitration, both sides will be honor bound to follow the suggestions of an independent arbitrator.
In the past, unions were necessary to secure worker's basic rights to a decent living. Today, unions have expanded their focus to fight for a series of extra rights and services for their members.
