The Luxton Bus Company debate
The scenario
The Luxton Bus Company (LBC) is a traditional bus operator providing the old fashioned red busses to London.
Their old style red busses are staffed by a two man crew. The driver, whose sole responsibility is to drive the bus and the conductor, who has the job of collecting fares and assisting passengers.
LBC have an operational staff of 200 employees, 100 drivers and 100 conductors.
They are each paid an annual salary of £18,000
In an attempt to modernise the business LBC want to buy in a new fleet of busses at considerable cost. These new busses are designed in such a way that the driver can also take on the job of collecting fairs thus eliminating the need for a conductor.
As they will no longer be needed, LBC want to lay-off all 100 of their bus conductors, and have offered a redundancy package of 6 months full pay in compensation. (a total of £9,000 per person).
LBC will also give drivers a raise of 20% for the extra responsibility they will be taking on, giving then an annual salary of £21,600
Conflict
LBCs workers union are refusing to accept the proposal. They will only agree to a new fleet of busses if there are no redundancies.
The LBC management insist that they need the new busses as the current aging fleet are no longer reliable enough for the job. They also claim that although there will be initial lay-offs, in the long run the company will become more profitable and take on more routes and hence more staff.
Debate
- Split into two groups. One group will play the role of LBCs management the other group will play the role of LBCs workers union.
- In your groups come up with your arguments for or against the proposal to present at the board meeting.
- At the board meeting you will put your points across to try and sway the board in your favour. You will also have the opportunity to ask the other group tricky questions to try and discredit their argument.
- At the end of the debate the board will make a decision whether to accept LBCs proposal and buy the new fleet of busses or to agree with the workers union and decide against the proposal.
LBCs management
- You desperately want the board to decide in your favour and buy the new fleet of busses as you believe the future of the company depends on it.
- If you buy the new fleet you will no longer need the bus conductors
- You could offer the union a better deal for laying off the conductors but the company will have very little spare money if it buys a new fleet of busses
- If you get the fleet of new more reliable busses you believe you will be able to offer more routes and hence expand your business. That will mean taking on more staff. Is there any deal you could offer the workers union that would involve re-training some of the conductors in a new role?
LBCs workers union
- You want the board to reject the proposal of a new fleet of busses
- You are happy to have the new busses themselves but know that it will mean half of you union members will lose their jobs
- From your experience working on busses you know that many passengers appreciate the better level of service offered by your company being one of only a few that have conductors.
- You are also worried that if the drivers were to collect fares themselves it would slow the bus down and increase peoples journey time.