Collect Bargain Contract
Order Description
Union Contract Negotiations
Rules:
-Each student will be assigned a bargaining team role (union).
-Negotiation strategies must be developed within the framework of the scenario provided.
-All activities should be directed toward an end result of an agreement that is mutually acceptable and that the respective parties (employees / management) can live with, survive on, and prosper under.
Instructions:
-Students will be assigned as a member of the union bargaining team. Each student individually will be responsible for developing and posting a collective bargaining negotiation plan (Word Document) based on the assigned scenario that outlines the selection of bargaining team members, defined priorities, negotiating the ground rules, presenting proposals, and negotiation strategies for their assigned team (union).
-The plan should also identify the major steps of a collective bargaining negotiation (from selecting bargaining team members all the way to ratifying the contract). You should attempt to anticipate the other side’s proposal topics. Some examples of major issues for negotiations include the following: 1) wages, 2) layoffs & use of seniority, 3) grievance process, 4) health insurance, 5) work conditions, etc. Each student should study the provided sections of the current collective bargaining agreement to identify contract language in need of improvement/deletion or identify key subjects not covered in the current agreement. Any proposed changes to the agreement should be supported with justification.
-Each student must complete a minimum of the first four columns of Form OL-1 and include with your posted plan. Form OL-1 should not be shared with others.
Lesson Text Book: Human Resource Management, the 12th Edition, By John M. Ivancevich & Robert Konopaske This week’s readings Chapters 15 and 17
Union Contract Negotiations Exercise – Union Scenario
(Do not share with others)
Union Team Scenario – You are to assume you are a member of a group of employees (Union) who
work for Company Sooner Carbon Corporation. Sooner Carbon is located in the state of Oklahoma and
has been in operation for approximately 20 years. The home office of Sooner Carbon is located in
Albany, NY.
Sooner Carbon generated about $40 billion in sales in 2010. The commercial market for their product
was $20 billion. This includes all types of products ranging from activated to impregnated carbon
products. Products are sold either in various stages in order to satisfy customer needs. Competition in
the industry is among purely domestic manufacturers who import specific product lines, and foreign
producers. Recently a new manufacturing plant was built in Mexico and several years ago in China.
Global competition has severely impacted the U.S. Carbon manufacturing industry for the past decade.
In a near complete reversal, over half of all U.S. Carbon products sold in the U.S. markets today are
imported. Once global competitors began rapidly entering the U.S. markets, the American
manufacturers responded by consolidating or closing U.S. operations, acquiring or building overseas
plants, and contracting with foreign companies to produce for the U.S. market. The number of domestic
manufacturers has fallen rapidly as weaker firms have exited the industry or have been acquired by the
remaining competitors. Sooner Carbon imports into the U.S. market over the last decade have
increased at annual rates as much as ten times the increase in American exports to foreign markets even
though shipping costs can total as much as one-fourth the value of the shipped products.
Labor intensive production operations are being outsourced to China, Vietnam, and Mexico to take
advantage of the lower labor costs. American Carbon workers can earn an average hourly wage of
about $15 while Chinese workers receive less than $1. Employment in the industry peaked in 2008 and
has begun to steadily decline since.
On March 1, 2013, the employment contract between the company and Lodge 014 of the International
Brotherhood of Carbon Plant Workers expired. In April 2013, negotiations began between the Union
and the Company in anticipation of the contract coming to an end. The Union presented demands to
the Company which included an across-the-board pay increase of 26%, a four day – 10-hour workweek,
and a 25 year full benefit retirement. Assume that the plant is poorly ventilated and not airconditioned, although the Occupational Safety and Health Administration has inspected and approved
the plant for safety purposes. The average hourly pay was $16.50. In addition, the workers have
hospitalization insurance and a retirement program wherein the employees are eligible for retirement at
age 62. The company to date has not made any counter proposals.
The company has two other smaller plants in operation, one in China and the other in Mexico. At 12:01
A.M. on March 1, 2013, the company locked all the employees out of the plant and has not permitted
re-entry. A skeleton crew of workers made up of management members has been brought in to operate
the plant on a very limited basis and it is rumored that the plant will be shut down completely at the end
of the year.
On March 3, 2013, the Union began picketing the Plant. The union workers have applied for
unemployment benefits, which were granted by the Court after a hearing to which the Company
protested and made the following two arguments.
1. The workers have not been fired, they are on strike.
2. If the workers are deemed to be terminated, they caused their own demise by making
impossible demands during contract negotiations. The Court has ruled the workers are entitled
to their unemployment benefits.
The parties have agreed to resume negotiations this week. The company has indicated that if an
agreement is not reached within the first hours of discussion, the company will close its doors in
Oklahoma and all the workers will be out of work.
Your task as a group is to choose a negotiating team of three persons, prepare for and develop a course
of action based on your research of collective bargaining issues and negotiation strategies, and
negotiate the Union contract for the next four years. Your team members who are not negotiators must
approve the contract by a majority vote. You are to get as much as possible for your workers in the new
collective bargaining agreement (contract).
Articles of the Collective Bargaining Agreement:
-Article 1: Purpose of Agreement
This Agreement, entered into by the Sooner Carbon Corporation, (SCC)-Employer, and The International
Brotherhood of Carbon Plant Workers, Lodge 014, (IBCPW)-Union as the Collective Bargaining Agent,
pursuant to State Statute, is made to:
a. Establish wages, hours, benefits, grievance procedures, and other conditions of employment
of represented employees of the Sooner Carbon Corporation;
b. Provide for quality product and service throughout Employer’s boundaries on an
uninterrupted basis for the benefit of the customers;
c. Assist in the amicable adjustments of labor disputes.
-Article 2: Recognition
Section 2.1: The Sooner Carbon Corporation, hereinafter referred to as Employer, recognizes the
International Brotherhood of Carbon Plant Workers, Lodge 014, hereinafter referred to as Union, as the
exclusive bargaining agent during the term of this Agreement. All employees shall be covered by this
contract.
Section 2.2: Employees who have not successfully completed the six (6) month of probationary period,
following their date of hire, shall be considered probationary employees. The six (6) month
probationary period may be extended by agreement of the Employer and the Union.
-Article 3: Authority and Term
The Employer and the Union have, by these presents, reduced to writing the Agreement entered into by
the Employer and the Union through the collective bargaining process as that term is defined by State
Statute. This Agreement shall be effective as of the 1st day of _________, 20___ and shall remain in full
force and effect through the 30th day of __________, 20___ pursuant to the terms of State Statute, and
governed by the terms of the International Carbon Workers Arbitration Act.
-Article 4: Management Rights and Responsibilities
Section 4.1: The Employer shall hire employees without regard to membership in the Union, and any
employee who is not a member of the Union shall receive and shall be entitled to all benefits, rights,
privileges, and agreements contained herein.
Section 4.2: The Employer expressly reserves the right to plan, direct, and control all operations, and to
hire, discipline, suspend, or discharge any employee, subject to the provisions of this contract.
Section 4.3: The Employer shall have the exclusive right to determine the source or sources from which
new applicants for work shall be secured; and shall be the sole judge of qualifications of employees for
retention with the Employer subject to existing ordinances, state law, and the Grievance Procedures
hereinafter specifically set forth.
Section 4.4: Except as specifically modified by this Agreement, all the rights, powers and authority the
Employer had prior to the signing of this Agreement are retained by the Employer and remain
exclusively and without limitation within the rights of the Employer.
Section 4.5: The employer and the Union specifically recognize the necessity of continuous improvement
in efficient and effective customer service through the Employer’s operations, and each party to this
contract agrees to cooperate with the other in accomplishing this result. In this regard there is hereby
created an employer-Union Committee, to meet on an as needed basis, but not more than once
monthly, to discuss areas of mutual concern.
Section 4.6: All rules, regulations, fiscal procedures, working conditions, employer rules and practices
and manner of conduction the operation and administration of the Corporation in effect on the
execution date of this Agreement shall be deemed as part of this Agreement unless and except as
modified or changed by the specific terms of this Agreement. This Agreement shall also supersede any
personnel policies of the Sooner Carbon Corporation Home Office which conflict with its terms. Except
as stated above, only the terms and conditions of employment of those individuals covered by this
agreement shall not be altered except by the agreement of the parties.
-Article 5: Bargaining Agent Security
Section 5.1: This Agreement shall be binding upon the successors and assignees of the parties hereto
during the term of this contract, and no provisions, terms or obligations herein contained shall be
affected, modified, altered or changed in any respect whatsoever by the consolidation, merger, or
annexation, transfer or assignment of either party hereto, or affected ,modified, altered, or changed in
any respect whatsoever by any change of any kind in the ownership, or management, of either party
hereto or by change geographically, or place of business of either party hereto.
Section 5.2: The employer agrees to deduct, bi-weekly, dues and assessments in the amount certified to
be correct by the Secretary of the Union, from the pay of those employees who individually request by
means of payroll deduction card authorization that such deductions be made.
The Employer further agrees to deduct, bi-weekly, a service fee from the wages of those employees who
are in the bargaining unit but who are non-members of the Union, upon the condition that non-Union
employees execute and keep effective a valid payroll deduction authorization. The amount of this
service fee shall be uniform among all non-Union employees. The total amount of deductions shall be
remitted by the Employer to the Treasure of the Union.
The Employer shall not be liable either at law or equity for any damages incurred by the Union, which
occurs from the Employer’s non-performance or delay of the duties and obligations of this Article 5,
Section 5.2 covenant, where such non-performance or delay is due to fire, electrical or machine failure,
strike, lockout, governmental order or regulation, or any other failure similar or dissimilar beyond the
Employer’s reasonable control.
Section 5.3: Upon giving five (5) days written notice, representative(s) of the Union may be granted a
reasonable period of time off with pay, by the Company CEO, to conduct bona fide Union business as
determined by the CEO. Business to be conducted must be defined and specified at the time the written
request is made. Specifically, Union Executive Board members may be granted up to forty-four (44)
days off per fiscal year under this section for purposes of performing their official duties, as set forth in
the Union constitution and by-laws. No more than an additional one hundred (100) days per fiscal year,
as a cumulative total, will be granted for non Executive Board members. No group in excess of five (5)
individuals shall be granted identical time off under this provision. However, nothing shall preclude,
upon five (5) days notice as above, the use of vacation or other recognized time off with pay by an
individual or group of individuals for bona fide Union Lodge 014 business.
Section 5.4: Employer agrees not to enter into any other agreement, written or verbal, with any
employee association which in any way conflicts with the provisions of this Agreement. Employer
further agrees not to discriminate against any employee for activity on behalf of, or membership in
Union Lodge 014.
Section 5.5: No employee shall be required to participate in any Employer sponsored or recognized
charity, nor shall any employee be discriminated against for failure to so participate. No employee shall
be subjected to a review of his/her personnel records to determine the employee’s participation or nonparticipation in any Employer sponsored charity.
-Article 6: (under review)
-Article 7: (under review)
-Article 8: Grievance and Arbitration Procedures
Grievances arising out of the operation and interpretation of this Agreement shall be handled and
settled in the follow manner:
Step 1: The aggrieved employee and/or union representative shall discuss the grievance with the
employee‘s supervisor within five (5) days of the occurrence.
Step 2: Should the answer provided by the supervisor (within three (3) days) not produce a satisfactory
solution to the grievance, the grievance shall be reduced to writing and shall state the provision of the
agreement which has been violated. The department head shall arrange for a meeting of the aggrieved
employee, the union representative, the supervisor, the employee relations supervisor, and himself or
herself for the purpose of discussing the grievance. The department head shall provide a written
answer to the grievance within 48-hours after the close of the meeting.
Step 3: If a satisfactory conclusion is not reached, the grievance can be referred to the plant manager by
the Union. The plant manager shall schedule a meeting with in two (2) business days to discuss the
grievance with the Union. The local Union can bring in a representative of the International Union at
this step, and the plant manager can bring in anyone who he or she feels may aid in the resolution of the
grievance.
Step 4: If there is no resolution at Step 3, the grievance is appealed to arbitration. The Employer and the
Union shall attempt to select an arbitrator. If this attempt fails, the Employer and/or Union shall ask the
Federal Mediation and Conciliation Service to submit a list of seven (7) arbitrators. Each party shall
eliminate three (3) names from the list by alternately striking one name at a time and the person whose
name remains shall serve as the arbitrator.
The arbitrator shall render a decision in writing that shall be final and binding upon the parties. The
arbitrator to whom any grievance is submitted shall have the authority to interpret and apply the
provisions of this Agreement, and the arbitrator’s decision must be in accordance thereto. The
arbitrator shall have no jurisdiction or authority to add to, subtract from, or modify any of the terms of
this Agreement.
The Employer and the Union shall each pay its own expenses incurred in connection with the arbitration
and one-half of the expenses and fees of the arbitrator and the facilities used in the arbitration hearing.
-Article 9: Skill Incentive Pay
Employees who are assigned as department/section trainers shall receive additional incentive pay in the
amount of three (3) hours pay per eight (8) hour shift during any period in which the trainer has a
trainee assigned to him or her.
-Article 10: Seniority
Section 10.1: “Seniority” as the continuous length of service of an employee with the Employer within
each job classification. Seniority shall commence from the last date which the employee is employed by
the employer; however, until the initial employment probation is completed, the employee shall not
attain seniority status. At the conclusion of said probation, the initial probationary service shall count as
a part of the employee’s seniority.
Section 10.2: Seniority shall be determined as between two or more employees by… (under review)
Section 10.3: Except where impractical due to skill levels of employees, or where special working
conditions exist which would preclude certain employees from working specific shifts or days, and
considering staffing levels, seniority shall be the dominant factor to be considered by the department
head and/or CEO in determining the priority of each employee to:
a. Time when annual vacation is granted
b. His or her first choice as to scheduling time off on Thanksgiving, Christmas Eve, Christmas, New
Year’s Eve, and New Year’s, it being understood that New Year’s Eve is not a designated holiday
under this Agreement.
c. Regular scheduled days off
d. Order of layoff and recall
Section 10.4: Seniority has no bearing on promotion decisions.
Section 10.5: Seniority shall be lost upon the occurrence of any of the following events: (under review)
a.
b.
c.
d.
e.
Section 10.6: In the event an employee is reduced in classification, the seniority previously accrued in
the former classification shall not be lost; however, the employee so reduced shall not be able to
exercise his or her seniority with respect to Article 10, Sections 10.3 (a) through 10.3 (d) for ninety (90)
days.
Section 10.7: Vacancies and assignments will be made in accordance with the procedures set forth in the
employee handbook / operations manual.
-Article 11: Personnel Reduction
Section 11.1: In the event it becomes necessary to lay-off employees for any reason, employees shall be
laid-off in the inverse order of their seniority by job classification.
Section 11.2: When an employee is laid-off due to reduction in the workforce, he or she shall be
permitted to exercise their seniority rights to bump or replace an employee with less seniority. Such
employee may, if he or she so desires, bump any employee in lower classification under the following
conditions:
a. He or she has more seniority
b. He or she can do the available work
c. Such bump request is initiated within two (2) working days of the date the employee receives
written notice of lay-off.
Section 11.3: Employees shall be recalled from lay-off according to their seniority within the job
classification.
Section 11.4: Notice of recall shall be sent to the employee at his or her last known address by certified
mail. If the employee fails to notify the Employer within five (5) calendar days after receipt of such
recall notice that the employee intends to return and if the employee after giving such notice of intent
to return fails to be available to return to work within ten (10) calendar days after receipt of such recall
notice, such employee shall be deemed to have quit.
Section 11.5: No new employees shall be hired into a classification until all employees who are on lay-off
status from that classification have been offered recall.
-Article 12: Personal Leave
Section 12.1: Sick Leave – a full-time employee is eligible for sick leave after completing six (6) months of
probation with the company. An eligible employee will accumulate sick leave at the rate of one-half day
per month of service from date of hire. Sick leave will not be carried over from one year (January 1 to
December 31) to the next, and it can be used only for personal illness not covered by workers’
compensation. The Employer retains the right to require a doctor’s certificate as proof that an absence
was due to a legitimate injury or illness.
Section 12.2: Vacation shall be accrued as follows: (under review)
Section 12.3: Emergency Leave
a.
Death in the Family – in the event of a death in the immediate family of an employee, the
employee shall be granted up to three (3) calendar days off, with pay, at the time of the
emergency. Immediate family shall be defined as: spouse, children, step-children, mother,
father, step-mother, step-father, brother, step-brother, sister, step-sister, grandparents, and
grandchildren of the employee and the employees’ spouse.
b. Sickness in Family – In the event of sickness or injury to a member of an employee’s immediate
family, as defined by above, which is serious enough to warrant the presence of the employee,
as certified by the attending physician, the employee shall be granted up to three (3) calendar
days off with pay. In the event the sickness or injury which qualifies under the FMLA, the
employee may be allowed to use personal sick leave for the duration of leave as certified by a
physician.
-Article 13: Holidays
Employees of the Employer who work a regular forty (40) hour week shall receive the following holidays
as paid time off: (under review)
-Article 14: Educational Incentive Pay
Employees covered by the agreement shall receive tuition reimbursement for college level courses
according to the following conditions:
a. Courses must be taken for credit hours at an accredited college or university.
b. The Employer will reimburse 100% of the employee’s tuition and mandatory fees for courses
which are satisfactory completed up to a maximum of $1,250.00 per semester. Satisfactory
completed is a letter grade of C minus or above or a letter of satisfactory completion for non
graded classes.
c. The Union and Employer will jointly determine the degrees which will qualify for
reimbursement.
Educational incentive pay shall be paid as follows:
a. Associates Degree $75.00 per month
b. Bachelor Degree $150.00 per month
c. Advanced Degree $175.00 per month
-Article 15: Insurance
All terms, benefits, procedures, policies, methods and manner of operating and administering the
current health and dental plans shall continue in full force and effect except for those changes as agreed
upon by the Union and Employer.
-Article 16: Complete Agreement
This agreement is complete. It may be amended by mutual agreement in writing. Such amendment
may be effective during the term of this agreement and may extend the term of this agreement. This
agreement does not operate to include, nor does it obligate the Company to continue in effect, any
working condition, benefit or past practice which is not covered or contained in the agreement.
-Article 17: Duration of the Agreement
This agreement shall become effective as of ____________________ and shall continue in effect until
_________________. Thereafter, it shall renew itself for yearly periods unless written notice of
termination is given by one party to the other not less than sixty (60) nor more than ninety (90) days
prior to the expiration of this agreement.
-Article 18: Labor Management Committee
A joint Labor-Management Committee will be formed during FY 2013-2014 to address the following
issues as agreed upon by the Union and Employer.
Form OL-1 Pre-bargaining Preparation:
Part A:
Bargaining Subject Area
(label the bargaining subject e.g., wages, holidays…)
Bargaining Priority (rank in highest order)
(ID the priority rank of the bargaining subject)
Realistic Expected Outcome
(describe in detail the specific outcome expected on subject)
Part B: Initial Bargaining Proposals
Instructions: For each initial bargaining proposal or counterproposal that your team intends to introduce
as part of the bargaining agenda at the joint negotiation meeting, include the complete, specific, and
clear wording of each initial subject proposal. Proposals should be stated using the exact contract
language your party would prefer to appear in the contract.
Exhibits
Exhibit 1: Company Balance Sheet 2011
Exhibit 2: Company Income Statement
2010
Exhibit 3: Production and Maintenance Employees by Seniority in OKC Plant
2011
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