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Fists pounding on tables, demands, showdowns, strikes. So went traditional collective bargaining: Each side fighting for a bigger slice of the same pie. Each side gunning for a narrowly drawn agreement on pay and working conditions, leaving mutual concerns about patient care, quality and affordability unaddressed.

But Kaiser Permanente and the Coalition of Kaiser Permanente Unions abandoned the traditional approach in 1997, when they founded the Labor Management Partnership.

Our negotiations feature committees, observers and flip charts of options. Since 2000, KP workers, managers and physicians have worked together to craft four National Agreements and one reopener amid relative labor peace. On March 30, some 150 representatives will begin to negotiate a fifth agreement. Assuming all goes according to schedule, the new contract for the 100,000 workers represented by 28 locals in the coalition will be ready to go into effect when the 2012 National Agreement expires Sept. 30.

In an age of growing health care costs and increased competition, the joint goal is to provide our health plan members and patients with better, faster, less expensive and more personal care and to maintain and improve the best health care jobs in the United States.

“Interest-based bargaining is not a utopia and not always a win-win. It’s taken Kaiser and the unions a lot of hard work to get where they are,” says Linda Gonzales, director of mediation services for the Federal Mediation and Conciliation Service, Southwest Region. “[But] to resolve difficult issues in partnership is a strength.”

Because of interest-based bargaining, Kaiser Permanente and the Coalition of KP Unions have been able to go well beyond wages and benefits—the subjects of traditional bargaining—in  negotiating four program-wide contracts. These National Agreements have developed industry-leading approaches to worker sick leave, safety and training and workforce development. They have created unit-based teams to improve patient care and service, set standards to hold teams and their sponsors accountable, and pioneered programs for the mutual growth of KP and the unions.  

Interest-based bargaining pays off in other ways as well.

“To understand one another’s interests, you have to engage in inquiry and listening, and you have to resist jumping to conclusions about the other party’s intentions,” says Harvard Business School Professor Amy Edmondson. “Doing this develops leaders who better understand how the organization works.”

“People in health care look to Kaiser Permanente as the showcase for working together,” says Gonzales, who helped facilitate bargaining for the first National Agreement in 2000.

The mediation service last year recognized a handful of cases of successful interest-based bargaining. Our Labor Management Partnership was one of them.

Picture a large room with 150 people. Hands are raised. Everyone gets heard. It is pushing midnight and exhaustion is setting in, but everyone maintains a sense of mutual respect and serious purpose.

It’s not the United Nations but the Common Issues Committee (CIC). The CIC is a representative group—made up of Kaiser Permanente workers, managers and physicians as well as delegates from the Coalition of Kaiser Permanente Unions—who take on the responsibility of negotiating a new National Agreement. The program-wide labor contract covers the 28 locals in the union coalition.

This inclusion is part of what makes our negotiations different from other labor contract negotiations—because how we bargain greatly affects what we bargain. By seating RNs and regional health plan presidents with lab techs and program managers during negotiations, interest-based bargaining at KP opens up new issues for discussion and creates deeper support for the final agreement.

“I personally learned a lot from the different perspectives voiced by all of the individuals representing their fields,” says Dr. Varoujan Altebarmakian, a medical group representative on the 2012 CIC. What he learned during bargaining, he says, made him an even more active advocate for partnership at Fresno Medical Center, where he is physician-in-chief.

A new CIC is formed each bargaining year. KP and union leaders select members and assign each to a subgroup to address a topic area. This year, those topics are expected to include Total Health, Work of the Future, and Operational and Service Excellence in Partnership.

Each subgroup is co-led by a management and union representative. Instead of taking hard-line positions, subgroup members stake out their common interests. Over the course of five bargaining sessions, assisted by outside facilitators, they identify interests and develop options.

In 2010, that process led to development of the Path to Performance, which established a uniform way of rating UBTs. “It was a defining moment in partnership,” says LaMont Stone, a labor liaison for Local 29 in Northern California who participated in 2010 and 2012 bargaining. “Before it was case by case, region by region.”

At the final bargaining session, each subgroup brings its proposals to the full CIC for discussion and agreement; the full CIC also negotiates wages and benefits. The finalized contract then goes to KP management for approval and is ratified by the members of each local in the union coalition.

Each day, more than 3,500 unit-based teams use interest-based problem solving and consensus decision making to improve performance and resolve issues throughout Kaiser Permanente. Those same techniques guide negotiations for the National Agreement.

The interest-based process differs from traditional bargaining in several ways. The first major difference can be seen in the room, says Dawn Bading, vice president of human resources for the Georgia region.

“The way we physically sit is different,” she says. “In traditional bargaining, labor sits on one side and management sits on the other. With interest-based bargaining, we sit at a U-shaped table and we are interspersed together. Beside me may be a union rep and on the other side may be someone from management. This physically represents the interweaving of thoughts and ideas.”

This intermingling continues as the negotiations begin, says LaMont Stone, labor liaison for OPEIU Local 29 in Northern California.

“In regular bargaining, you start apart and try to come together,” says Stone, who has participated in bargaining the last two National Agreements. “Here, we start together and try to stay together.”

Part of the power of interest-based bargaining is that in the early stages, the parties aren’t staking out possible solutions.

Walter Allen, executive director and CFO of OPEIU Local 30, says that in traditional bargaining, sides may start off with extreme positions to better their chances of getting what they actually want in the negotiations. “I’ve heard some unbelievable proposals, such as having Groundhog Day off,” Allen says. “Because we don’t do proposals (positions)—we do interests—you don’t get that here. You have to say why this is an interest. How can you argue seriously for Groundhog Day off? No one wants to defend a stupid proposal. Interest-based bargaining eliminates a lot of nonsense.”

This step also helps each side see how much they have in common before moving on to develop options and reach consensus.

“At times it was tedious,” says Angela Young, a unit assistant at Roseville Medical Center. An SEIU-UHW member, Young was a 2010 and 2012 member of the Common Issues Committee and is headed to bargaining again in 2015. “But it keeps the conversation going, and got us where we needed to be. That’s a good thing.”

When I was asked to serve on the national bargaining team in 2012, I was a newbie. I had never done bargaining before and didn’t know what interest-based bargaining was. I quickly learned it is a skill that would serve me well, both in the bargaining sessions and in my career beyond that event.

Bargaining began with a significant investment from the company providing both labor and management representatives with education sessions to understand interest-based bargaining. Part of this education was to understand the landscape of Kaiser Permanente and how we were doing in the industry. It also included a look at the future, as well as the history of KP and the value of the partnership. Bernard Tyson (KP’s chairman and CEO) made it clear that partnership is an asset to KP and it wasn’t going away.

I worked on the Growth team, which was to find ways to help grow KP and union membership. We practiced together with scenarios, using the interest-based problem solving tools—a great way for the team members to start to trust each other.

As we went through the process, there were times we disagreed, and we worked through that. Getting through those tough conversations really showed that although we might be coming from a different place, we had the same commitment and common interests.

One of the interesting aspects of working with a national team was meeting folks from across the KP program. Although I am from Colorado, it was interesting to see that the concerns we had from our region were similar to those of Mid-Atlantic States.

I was a little concerned going into the process that we’d get stuck on some of the local issues. When specific regional issues came forward, we were able to quickly work through them and refocus. I was impressed with my labor partners, who really helped us move from the local issues to the strategic.

Honestly, there were times when I wondered if we were going to be able to get through it. The process was a reaffirmation that we are all on the same page. Other companies haven’t been able to do what we do. We stumble and fall back on traditional methods at times, but there is power in the KP model of how we do things.

When I was asked to represent The Permanente Medical Group at 2012 bargaining, I leapt at the opportunity. My own experience with partnership at Fresno Medical Center showed me what great things could be accomplished with collective problem solving.

I sat on the subgroup that looked at how to improve partnership to enhance performance and Kaiser Permanente’s operational agility. I was amazed at seeing so many people with different backgrounds sharing their thoughts and shaping the outcomes. From the highest levels of Kaiser Permanente and union leadership to the front line, everybody was around the table, and they were all equal in this venue. Everyone was heard and engaged.

I personally learned a lot from the different perspectives voiced by all of the individuals representing their fields. I strongly believe that collective wisdom is better than individual wisdom, and that with collective wisdom you can achieve anything in life. Interest-based bargaining, which assembles voices from all levels and reaches of Kaiser Permanente, is a great example of collective wisdom.

Another thing that struck me—how much folks craved the physician perspective. When I spoke, all 25 to 30 people in that subgroup really listened. And there were issues where a physician perspective was critical. That was a strong message I brought back to physicians. In most unit-based teams at Fresno, there is physician involvement. The intention is to bring those perspectives together to enhance the care for our members and patients. But does that mean if I walk into a UBT meeting I’ll see a doctor? Maybe yes, maybe no.

I’ve worked at Kaiser Permanente for 34 years, and I saw the pre-partnership years. They were contentious ones. We’ve had relative peace with coalition unions since partnership. That’s not to say that working in partnership is perfect in every way. It can’t be done without trusting each other. And how do you develop trust? Through transparency. The whole bargaining process was about transparency; essentially, everybody could share everything. That doesn’t mean people didn’t disagree.

The interest-based, collective approach takes into account everyone’s perspectives to reach a better outcome, which is ultimately a common goal—superior care for our members and patients.

I just used interest-based problem solving (IBPS) while I was at a union convention in Philadelphia. We got five people to rent a car together and go sightseeing on our one day off. So we had to decide what to do in Philadelphia for 24 hours. We brainstormed, then identified the ideas we all supported. We went to Valley Forge, Amish country and the boardwalk in Atlantic City. It worked great.

My husband and I used interest-based problem solving to make a decision about a major purchase recently. I used IBPS to get to “yes.” IBPS is the easiest way to organize your mind. My mind automatically goes to it and that whole process. If a conversation gets confusing, you can go back to the structure provided by it.

Being at a round table with interest-based problem solving is the best way to move health care forward. What we do at the bargaining table with IBPS is great, but we need to do a better job bringing that back to the workplace. We can make it better by having more frontline managers at the bargaining table.

Frontline managers, especially the newer ones, need a sense of the history and commitment of our National Agreement. And frontline managers need more support. There are still problems with backfill, with allowing employees to be involved in LMP activities.

The way we do business at Kaiser Permanente is the Labor Management Partnership, so we need to have those interest-based discussions. I’ve been involved in 2000, 2005, 2010 and 2012 bargaining. I am in awe of the great work labor and management representatives do—and how we can come up with common goals in a nonadversarial manner. I hope we all see it as a value.

A former KP administrator, Michael Belmont now works for Restructuring Associates Inc., the consulting firm that helped during the creation and initial implementation of the Labor Management Partnership and that now helps facilitate national bargaining. He sees interest-based bargaining as a way to solve the problems of the future, before they arise, instead of getting stuck dealing with the baggage of past grievances.

My time at Kaiser Permanente dates back to the late 1980s. I was assistant hospital administrator in Panorama City, dealing with several unions. We were facing so much discord. It was all-encompassing, and it took the focus off improvement issues. The move toward interest-based bargaining and [the] Labor Management Partnership allowed us to put the focus on improving the member experience instead of continually trying to resolve labor problems.

Partnership, especially interest-based bargaining, gives employees and their unions a chance to have an impact on things they might not otherwise. They have a say beyond wages, hours and working conditions. In 2012, there was a bargaining subgroup on growth, focusing both on growing Kaiser Permanente and the unions. In a traditional setting, that doesn’t happen. For employees and their unions, the other side of the interest-based process is responsibility and accountability to take on and help solve the problems of the organization.

When we do trainings on interest-based problem solving, people will say, “This is how I deal with relationships.” If you are going to be a good partner—and have a successful relationship with a partner, kids, friends—you have to have your partner’s interests in mind as well as your own. Making this connection helps people connect the strategy to their work lives.

After 2000 bargaining, the Southern California region was looking for a change in labor relations, away from traditional, toward partnership. We were trying to move labor relations away from being a wall between the unions and management and toward facilitating a productive relationship between unions and management. I saw a gradual transition toward more of a partnering role. I left KP in 2006. I could come back [with Restructuring Associates] as a neutral [party] in 2010 and 2012 because of the [nature of the previous] relationships with union and management officials.

Interest-based bargaining is focused on solving problems up front rather than on grievances. People have to unlearn a lot of habits and build a lot of trust. There was 50 years of baggage [when the partnership started]. A traditional approach leaves lots of scars. Traditional is the comfort zone for most organizations. Traditional approaches are backwards looking: They are about solving problems from the past that pile up and wait for bargaining. Interest-based bargaining is about solving problems and issues that may come up in the future. Using the interest-based approach in bargaining and in day-to-day work is a much more forward-looking way to solve problems—and so much more effective.