this is a report for HR

in this report i'm from the union side

i have to make a Indivdual Strategy Report and Indivdiual Final report

the following pics will give u all the details

please please help me

i need this done by 20th

im in the hospital , i have a surgery which is why this has become inpossable for me to complete

Table of Contents Bargaining Simulation Page ...3 A. Exercise Description B. Collective Bargaining Simulation Assignment .4 C. Directions of Exercise... 5 7 D. Background of Welby Gardening Equipment Ltd.... E. Financial Information 9 12 14 F. General Information G. Issues Arising Under the Current Collective Agreement H. Articles to be Negotiated. 1. Bargaining Details and Costing... 16 17 - + 9 Page view A Read aloud V Draw Bargaining Simulation A. EXERCISE DESCRIPTION You are a member of the Management or Union Team; the collective agreement is about to expire, and you are required to engage in collective bargaining. You will analyze the collective agreement and confidential information for your side only and identify areas where the union and the employer would like to see changes and additions to the collective agreement. You will prepare demands and proposals for the upcoming negotiation The purpose of the exercise is to: a. Have students identify and prepare different potential proposals b. Help students develop a negotiation strategy c. Help you understand the forces which shape collective bargaining. d. Reflect on an agreement and identify what would be potentially beneficial for your side and what may be problematic. 2. Your instructor will assign you a union team or to a management role to prepare for 3. Your individual objectives include: a. Prepare proposals for your side that will satisfy the interests of your stakeholders b. Develop a strategy that will help you to maximize your gains while keeping the working relationship intact and would avoid a strike or lockout B. COLLECTIVE BARGAINING SIMULATION ASSIGNMENT (30% of final mark) 1. Individual Strategy Report (20%) Each student will be assigned to the role of Management or Union. You will develop proposals for the upcoming bargaining session that will maximize the gains for your stakeholders and satisfy their needs. You will support your proposal with relevant market research, and determine the costs associated with your proposals. You will then identify what concerns the other side may have with each of your proposals. You will be asked to identify a new contract terms that will benefit your side. Again, identifying concerns that the other side may have. You will articulate a strategy to approach the negotiation, to achieve your goals. 2. Individual Final Report (10%) This report will capture an analysis of the final negotiated settlement. You will be given a final settlement by the instructor, you can assume that the negotiation had already taken place. You will discuss the overall desirability of the final settlement and discuss future implications of this settlement for both the union and employer. - + D Page view A Read aloud Draw C. DIRCTIONS FOR THE EXCERCISE In this exercise you have considerable leeway as to sources of information you may use. You may want to refer to outside readings and industry statistics for general background material. If you use outside information, it must not conflict with information supplied in these exercise notes. It is helpful to have completed research of the Alberta marketplace, Alberta Employment Standards and other collective agreements to bolster your arguments. Collective Agreement Bargaining Steps Individual Strategy Assignment (20%) 1) Working independently. You will develop proposals for the upcoming bargaining session that will maximize the gains for your stakeholders and satisfy their needs. You will place your proposals and proposed language into the template chart. 2) You will provide your supporting evidence into the template chart. The supporting evidence is information from the external market, or other collective agreements that justify your proposal as reasonable and necessary. Utilize rational and proof from the Alberta market (other collective agreements, other external sources of Information) that justify your proposal 3) You will calculate any increased costs associated with your proposal. 4) You will then identify what concerns the other side may have with each of your proposals and a potential counter proposal. Also populating the template chart, 5) You will be asked to identify one new contract term that will benefit your side. Again, identifying any increased costs, supporting evidence or concerns that the other side may have 6) Employers may only propose to maintain the current collective agreement language on two monetary articles, otherwise they must propose an increase or decrease in 7) You will articulate a strategy to approach the negotiation, to achieve your goals. conto, ON Auto + ED Page view A Read aloud Draw N Collective Agreement Bargaining Steps Individual Strategy Assignment (20%) 1) Working independently. You will develop proposals for the upcoming bargaining session that will maximize the gains for your stakeholders and satisfy their needs. You will place your proposals and proposed language into the template chart. 2) You will provide your supporting evidence into the template chart. The supporting evidence is information from the external market, or other collective agreements that justify your proposal as reasonable and necessary. Utilize rational and proof from the Alberta market (other collective agreements, other external sources of information) that justify your proposal. 3) You will calculate any increased costs associated with your proposal. 4) You will then identify what concerns the other side may have with each of your proposals and a potential counter proposal. Also populating the template chart. 5) You will be asked to identify one new contract term that will benefit your side. Again, identifying any increased costs, supporting evidence or concerns that the other side may have. 6) Employers may only propose to maintain the current collective agreement language on two monetary articles, otherwise they must propose an increase or decrease in costs 7) You will articulate a strategy to approach the negotiation, to achieve your goals. 8) All information will be placed into the Individual Strategy Template and submitted no later than the due date, late assignments will not be accepted Individual Final Report (10%) 1) You will then create a Final Negotiation Report. 2) You will be given the final agreement which you can assume was negotiat the parties. You will need to calculate the associated costs of the agreeme a debrief of the negotiation answering the following questions: From your original perspective as either the union or employer, review the settler and the following: 1) Insightful review of each negotiated collective agreement section. How close to your proposal was the actual final settlement? What might have been the strategy involved in the settlement? Why might the parties have decided on a particular clause? 2) Overall statement of desirability of the entire settlement. Do you feel your side got a good deal? Why? Were there any surprises, are there any problems with the deal? 3) Overall future implications of the entire settlement. What does this settlement mean for the parties going forward? How might this settlement affect the relationship of the parties in the future? How might this settlement affect the operations of Welby in the future? This report should be written individually. Please space and a half the report, Spelling, grammar and mechanics are important, deductions will be made for errors to a maximum of 10% Appropriate length is between 3-6 pages. 3) Overall future implications of the entire settlement. What does this settlement mean for the parties going forward? How might this settlement affect the relationship of the parties in the future? How might this settlement affect the operations of Welby in the future? This report should be written individually. Please space and a half the report, Speling, grammar and mechanics are important, deductions will be made for errors to a maximum of 10% Appropriate length is between 3-6 pages. Should you utilize any external resources please ensure that they are correctly cited using APA format with a reference page. D. BACKGROUND OF WELBY'S GARDENDING EQUIPMENT Ltd. Company History Welby's is a private family run business that makes metal gardening equipment. They produce all products on site at their shop in Edmonton, Alberta. Welby specializes in high quality products with a focus on ergonomics. They have several different models of shovels, spades, hoes, pitch forks, post hole diggers, rakes, and tampers that they sell to retail stores. The company was founded by Edward Welby who came to Canada from Scotland, 45 years ago. Edward was an avid garden and was disappointed by the poor-quality tools that he found in his local hardware store. He found the tools did not stand up to the rigors of the Canadian weather and soil conditions. Overtime Edward worked with his friend and fellow Scot, Dougal McCoy, who was an engineer to develop sturdy, reliable and ergonomically friendly tools. The tools were high quality and utilized sophisticated welding and fastening systems so that shovel heads did not fall off the handle, nor pitchfork tines break The company grew very quickly in the years from 2010 to 2015 as interest in gardening expanded and demand for good quality tools increased. Sometimes the demand outstripped supply and Welby had to ask workers to work long hours to meet supplier orders. As well Welby had to invest in new equipment and warehouse space to meet the growing demand, so could not invest in a benefit plan for his employees. Employees began to become disgruntled and word of a union organizing campaign spread. Welby was not worried as the company always had a family atmosphere and surely the employees would know that the investments he was making in new equipment and warehouse space was to make employee's lives better In 2016 the Canadian Fabricators Union, already active in Edmonton, ran an organizing campaign at Welby and with the help of some very disgruntled employees, the Union signed up three-quarters of the shop and warehouse employees. The company attempted to stop the organizing drive, but by January 2017 the Fabricators Union were certified as the exclusive bargaining agent for the hourly wage employees. The company was shocked that the employees would join a union, but they managed after 7 months of negotiating to obtain a collective agreement. The company has continued to grow since that time and recently has experience high demand with the increase in home gardening since the pandemic of 2020. Although sales are up profits have not always corresponded and recently problems with sourcing raw materials and delivery problems have plagued the company. Union and Company Relations The first collective agreement negotiations were long and grueling and caused some hard feelings on both sides. With the help of a mediator the parties came up with a first agreement that was only for a year from 2017 to 2018. The company and union have had a second round of bargaining where things were slightly less acrimonious. The company agreed to a bare bones benefit plan in the first agreement but did not concede to the union's demands for significant improvements to the plan in the second round. Edward Welby is getting older and is looking at retirement in the next few years, his daughter Sarah will be taking the helm from her father and has some very strong views about the union. She has repeatedly mentioned that the union is trying to run the business and has their nose in everything. As well she is concerned that with the increased costs in raw materials and that employees have "pie in the sky" expectations of wage and benefit increases in this next round of bargaining. She would like to see some work that Welby currently does in house sent to sub-contractors who may be able to do it more cost effectively. This way Welby tools could be produced cheaper and would be able to compete with the cheaper knock off tools in the big box stores. Sarah is also committed to continuing to purchase new equipment to ensure that the quality of the Welby tools stays as their point of differentiation in the market. Sarah feels that the union has become too demanding in the past with her father and that she would like to change the relationship to remind the union who the boss is! She likes to keep a tight rein on management of the company and is determined that management rights will be enforced. 20Tools%20Negotiation pdf + 2 D Page view A Read aloud | Draw The Fabricators Union wants to ensure that they increase compensation and benefits as well as have a greater say in management decisions. They need to take a more aggressive stance in this round of negotiations. There is a concern that another union has been making overtures to the Welby employees to leave the Fabricators union and join their union. Employees have started to get restless and there are rumors that the other union can guarantee them better wages, benefit plans and more say in decisions. The Fabricators are determined to get substantial increases for their members. coTools%20Negotiation.pdf + D Page view A Read aloud V Draw E. FINANCIAL INFORMATION Welby Gardening Equipment Ltd. Balance Sheet: 31 December last year Assets Cash Marketable securities Accounts Receivable Inventory Prepayments $425,000 632,000 3,578,000 7,136,000 215.000 Total Current Assets Net Building and Equipment $11,986,000 7.522.000 Total Assets $19.508.000 Liabilities Accounts Payable Notes Payable $6,098,000 2.246.000 Total Current Liabilities Mortgage (secured by plant) $8,344,000 $2.780.000 Total Liabilities $11,124,000 Common Stock Retained Earnings $3,346,000 5.038.000 Total Liability and Shareholder Equity $19.508.000 Tools%20Negotiation.pdf + 2 D Page view A Read aloud Draw V Welby Gardening Equipment Ltd Income Statement for Last Calendar Year Sales $36,225,000 Less Cost of Goods Sold Opening Inventory Materials Hourly Labour Manufacturing Overhead Good Available for Sale Less Closing Inventory Total Costs of Goods Sold $3,250,000 17,850,000 6,895,000 4.250.000 32,245,000 3.269.000 28.976.000 Gross Profit $7,249,000 Less Operating Expense Administrative and Office Sales and Distribution Total Operating Expense 2,688,000 2.157.000 4.845.000 Operating Income Other Deductions (Interest) Net Income Before Tax Income Tax, Net Net Income 2,404000 893,000 1,511,000 726.000 $785,000 includes the cost of benefits Tools%20Negotiation.pdf + ID Page view A Read aloud Draw Welby Gardening Equipment Ltd. Net Sales and Income YEAR NET SALES NET INCOME Three years ago Two years ago Last year 26,487,000 30,811,000 36,225,000 2,114,000 1,790,000 785,000 To obtain comparative external financial/statistical information and data you should consult the appropriate website for Statistics Canada and/or the Alberta Government. Some of the following information may be useful: a. b. C. d Settlements for Collective Bargaining Agreements, Alberta Average Earnings in Alberta (Manufacturing) Average Earnings or Hourly Rates in Alberta, Metal Fabricating Industry Edmonton Consumer Price Indexes by month and year to date Any other related and current Alberta wage and benefit information. e. F. GENERAL INFORMATION 1. Welby employees work the following Hours in a day Hours in a week Hours in a year 8 hrs 40 hrs Days of work per year 250 days 2000 hrs 2. The following is a breakdown of the unionized employees in each job classification and corresponding hourly rate. Job Classification Hourly Rate 1 AN Number of Employees in the Classification 26 41 31 12 8 6 6 5 3 2 $21.85 23.25 24.25 25.6 26.85 27.85 28.3 29.1 32.7 35,95 5 6 7 8 9 10 3. Vacation Pay: Employees have the following service with the Company Years of Service Number of Employees Less than one One but less than three Three but less than five Five but less than eight Eight but less than ton 35 26 31 22 7 Welby Gardening Equipment Ltd. Net Sales and Income YEAR NET SALES NET INCOME Three years ago Two years ago Last year 26,487,000 30,811,000 36,225,000 2,114,000 1,790,000 785,000 To obtain comparative external financial/statistical information and data you should consult the appropriate website for Statistics Canada and/or the Alberta Government. Some of the following information may be useful: a b. C d. Settlements for Collective Bargaining Agreements, Alberta Average Earnings in Alberta (Manufacturing) Average Earnings or Hourly Rates in Alberta, Metal Fabricating Industry Edmonton Consumer Price Indexes by month and year to date Any other related and current Alberta wage and benefit information. 35.95 2 3. Vacation Pay: Employees have the following service with the Company: Years of Service Number of Employees Less than one One but less than three Three but less than five Five but less than eight Eight but less than ten Ten but less than fifteen Fifteen but less than twenty Twenty or over 35 26 31 22 7 12 5 2 140 No chango in vacation ontitlement is requested for employees with less than one-year service. Assume these employees have an average of 6 months service. 4. Protection Benefits: The following figures are required for benefit costing and represent monthly premium costs for single and married employees. Assume that 45 employees are single and 95 are family. Single Family a. Alberta Blue Cross premium $37.45 $82.36 b. Group Life Insurance premium $0.42 per $1000 coverage c. Short Term Disability premium $18.36/mo./ee. d. Pension Plan Contributions The most common arrangement here is to contribute a percentage of an employee's basic wage such as 5%. These can be made by the company alone or some cost-sharing arrangement with the employees. Duration of Agreement: You are required to negotiate a one (1) year collective agreement. G. ISSUES ARISING UNDER THE CURRENT COLLECTIVE AGREEMENT This information will help you understand some of what the Management and the Union are looking for with each article you are negotiating. Articles Management would like to change: Article 4 Grievance Procedure Introduce language before the reference to Step 1 that requires a "complaint stage" requiring employee(s) to discuss an issue with the supervisor in an attempt to resolve the matter prior to Step 1. Article 6 Discipline Remove the word "verbal" from the first line in article 6.02 Article 7 Employee Record Replace the time limit for expunging a discipline record from 10 months to 36 months. Article 10 Compensation Change safety shoe allowance period from 12 to 24 months Reduce safety shoe allowance to $100 per year. Article 16 Job Posting Remove the wording "most senior" and replace it with "most qualified", in line 2 on transfers Article 17 Sick Leave Remove any accumulation of unused illness leave days. Article 17 Sick Leave Remove any accumulation of unused illness leave days. Articles the Union wants to change: Article 3 Management Rights Eliminate the language "who has acquired seniority" from the current agreement in 3.02 Article 9 Statutory Holidays More than nine statutory holidays with pay Article 10 Compensation DE 14 1. Increase annual shoe allowance to $185 per year. 2. Basic wage rates to be increased substantially. 3. Increase call in pay from 3 hours Article 11 Shift Premium A substantial increase in shift premium. Article 12 Vacation Much improved vacation benefits. Article 13 Seniority Reduce the probationary period (after which seniority is accumulated) from one hundred and eighty (180) calendar days to (60) calendar days. Article 15 Leaves of Absence Introduce up to 10 paid days for any approved Leave of Absence not currently paid by the employer Leave of absence days X number of employees X average hourly wage rate X 8 hour per day Article 16 Job Postings Eliminate of Article 10.02 Articlo 17 Sick Loavo Increase the number of paid sick days substantially, Article 18: Employee Benefits Employees are very dissatisfied with the health and wellness benefits. As well they are very concerned that they do not have a pension plan. In many other unionized companies having employees doing similar Jobs, these benefits are much better and the company contribution to the cost is much higher. + @ ID Page view A Read aloud Draw H. REQUIRED ARTICLES FOR NEGOTIATION You will be negotiating the following required articles in the collective agreement. This list is not exhaustive and each party to the negotiation may add in additional items for negotiation Art. 3 Art. 4 Art. 6 Art. 7 Art. 9 Art. 10 Art. 11 Art. 12 Art. 13 Art. 15 Art. 16 Art. 17 Art 18 Management Rights Grievance Procedure Discipline Employee Record Statutory Holidays Compensation Shift Premium Vacations with Pay Seniority Leaves of Absence Job Posting Sick Leave Employee Benefits + O Page view l A Read aloud V Draw I BARGAINING DETAILS AND COSTING **Important Information for Calculating Costs** Average hourly wage rate: (number of employees in each classification X classification pay rate) divided by 2000 hours worked per employee $3447.50 (union employees cost per hour/2000 hours per employee per year = $24.63 average hourly wage rate) Total Cost of Payroll: 2,000 hours worked per employee X (number of employees in each classification X classification pay rate) = $6,895,000 2000 hours X $3447.50 (union employees cost per hour) = $6,895,000 Article 9 Additional Statutory Holidays: Additional Statutory Holidays X number of employees X average hourly wage rate X 8 hours per day Article 10 Compensation 10.01 Wage Rates: Increase the total cost of payroll by the percent of increase $6,895,000 X % increase = New Total Cost of Payroll. Or Increase certain classifications only rather than the whole organization 2,000 hours worked per employee X (number of employees in each classification X adjusted classification pay rate) = New Total Cost of Payroll 10.02 Cost of Shoe Allowance: Increase in shoe allowance X 140 employees Article 10 Compensation 10.01 Wage Rates: Increase the total cost of payroll by the percent of increase $6,895,000 X % increase = New Total Cost of Payroll. Or Increase certain classifications only rather than the whole organization. 2,000 hours worked per employee X (number of employees in each classification X adjusted classification pay rate) = New Total Cost of Payroll 10.02 Cost of Shoe Allowance: Increase in shoe allowance X 140 employees 10.03 Cost of Call-in Pay: Call in pay is currently at 3 hours of pay per call. Traditionally the Company has about 85 "call ins" per year. The average wage rate is $24.63. Thus, an increase in pay of 1 hour would be the (1-hour increase X average wage rate) X the number of call ins. 1-hour increase X $24.63 (average hourly wage rate) X 85 (number of call ins) = 1X $24.63 X 85 = $2093.13 Article 11 Shift Premium: 50 employees work the afternoon shift. If you increased the shift premium by $1.00 it would result in an increased cost of 50 employees X increase X 2000 hours per year. 50 employees X $1.00 shift premium increase X 2000 hours per year = $100,000 Article 12 Vacations with Pay: Additional number of weeks of holidays X number of employees X average hourly wage rate X 40 hours per week If you wanted to provide additional weeks to just a certain number of employees simply adjust the number of employees. Article 15 Leaves of Absence Leave of Absence Days X number of employees X average hourly wage rate X 8 hour per day. Article 17 Sick Leave Increased number of paid sick days X number of employees X average hourly wage rate X 8 hour per day. Article 18 Benefits - note you cannot change the premium amounts only the percentage shared between the employer and employees or coverage amount. 18.02 Group Life Insurance: The cost of the premiums is $.42 per month for each $1,000 of coverage. To increase coverage, you can calculate the costs as: premium cost X (increase/1000) X total number of employees X 12 months Thus, an increase of $15,000 worth of coverage would be (0.42 premium cost X 15 increase in coverage) X 140 X 12 = 5.85 X 140 x 12 = $10,584 However, the employer currently only pays half the premium costs so the Article 18 Benefits - note you cannot change the premium amounts only the percentage shared between the employer and employees or coverage amount. 18.02 Group Life Insurance: The cost of the premiums is $.42 per month for each $1,000 of coverage. To increase coverage, you can calculate the costs as: premium cost X (increase/1000) X total number of employees X 12 months Thus, an increase of $15,000 worth of coverage would be (0.42 premium cost X 15 increase in coverage) X 140 X 12 = 5.85 X 140 X 12 = $10,584 However, the employer currently only pays half the premium costs so the total is divided by 0.5 (half) = $10,584/2 or $10,584 *0.5 = $5292.00 18.03 Alberta Blue Cross: The cost per month for single coverage is $37.45. The cost per month for family coverage is $82.36. There are 45 employees with single coverage and 95 employees with family coverage. The current agreement splits the payment of the premiums 50/50, in other words the company pays half the cost of the premiums and the employees pay for the other half. 18 Article 18 Benefits - note you cannot change the premium amounts only the percentage shared between the employer and employees or coverage amount. 18.02 Group Life Insurance: The cost of the premiums is $.42 per month for each $1,000 of coverage. To increase coverage, you can calculate the costs as: premium cost X (increase/1000) X total number of employees X 12 months Thus, an increase of $15,000 worth of coverage would be (0.42 premium cost X 15 increase in coverage) X 140 X 12 = 5.85 X 140 X 12 = $10,584 However, the employer currently only pays half the premium costs so the total is divided by 0.5 (half) = $10,584/2 or $10,584 *0.5 = $5292.00 18.03 Alberta Blue Cross: The cost per month for single coverage is $37.45. The cost per month for family coverage is $82.36. There are 45 employees with single coverage and 95 employees with family coverage. The current agreement splits the payment of the premiums 50/50, in other words the company pays half the cost of the premiums and the employees pay for the other half. 18 If the union and the company agree to a cost sharing of say 80/20, then the additional cost to the company is as follows: (Proposed cost share - existing cost share) X premium cost X number of employees X 12 months. Family premiums = (80% proposed premium coverage - 50% existing premium coverage) X 82.36 premium X 95 number of employees X 12 months 3 X 82.36X 95X 12 =$28,168. 12 Single premiums = same as above with single premium amount 18.04 Short Term Disability: The simulation says that the short-term disability plan premiums are $18.36 per month per employee with the company picking up half the amount. If as a result of the negotiations, the parties agreed to a premium paid 100% be the employer the new cost would be: $9.18 (the other half of the premium that is currently paid by employees) X 12 months X 104 employees = $11.456.64. 18.05 Ponsion: There is no pension plan now, so any pension plan represents a new cost to the company. If the parties agreed to a pension plan where the company contributes 5% of wages into the plan, the cost would be 5% of the total wage salary budget. The cost would be less if the employees paid a portion of the 5%. If the costs were split 50/50 then the new cost to the company would be 2.5% of the total wage salary budget Confidential Union Bargaining Team Instructions To: Union Bargaining Team From: Local Executive Subject: Contract Renewal Negotiations This memo provides instructions to members of the bargaining team representing Canadian Fabricators Union, Local # 247 for the upcoming contract negotiations with Welby Gardening Equipment Ltd. The bargaining team is instructed to deal with the issues referred to here and any issues raised by management. The team is directed to negotiate an agreement with the employer that, to the extent possible, falls within the limits prescribed in this memo. If any issues arise in negotiations that are not covered in this memo the team is authorized to settle those issues on the best terms possible. Article 3 Management Rights This article provides that only employees who have acquired seniority may made a claim of being discharged without cause. The Union will demand that the phrase "who has acquired seniority" be removed Article 4 Grievance Procedure The current agreement provides that the time limits in the grievance process are mandatory. The bargaining team should attempt to have this amended to provide that the time limits are directory (suggested) Article 9 Statutory Holidays This article provides for the minimum number of holidays required by provincial, the union will demand additional holiday days. Calculate the potential costs. Article 10 Compensation The bargaining team is instructed to pursue a one year agreement, the local hopes to achieve a significant wage increase. The local feels that they have not been compensated properly. A strike vote has not yet been held; however, it is anticipated that the bargaining unit will vote in favour of a strike. Calculate the costs of a potential increase. The current agreement also provides for $130 purchase for safety shoes. The union should seek to increase this amount to $185. Calculate the costs. The current agreement provides for 3 hours of call in pay for each time than a union members is recalled to work from home to attend to an emergency in the workplace. Calculate the costs. Article 12 Vacations with Pay The union must seek additional vacation days. Calculate the costs Article 13 Seniority The current agreement provides that an employee remain a probationary period of 180 days. The union should demand that this temporary period be reduced to 60 days. The current agreement requires that in the event of a layoff, when an employee is to be recalled they must be capable of performing the position available. The union should seek to have this provision of capability removed. The current agreement provides that bargaining unit employees will lose seniority if they are absent from work for 3 consecutive days or overstays a leave, without a valid reason. The union should seek to have these provisions removed. There are no current provisions for determining the order of seniority in the event that two employees have the same seniority date. Tie-breaker language needs to be determined. There are no current provisions for super seniority for union representatives. The Union should seek provisions that protect union representatives in the event of a layoff. Article 14 Leaves of Absences The Union must demand an additional 10 days of paid leave of absence. Calculate costs. Article 16 Job Posting 1. Openings should be posted for a defined period of time. Typically, opportunities are posted for one week 2. Employees should be placed on available openings by seniority 3. Employees should have an opportunity to apply for any secondary openings. 4. Remove the time frame that required employees to be with the company for 12 months prior to applying on any vacancy. Article 17 Sick Leave This Article provides for a small amount of paid sick leave days, the union will demand a substantial increase. Calculate costs. Article 18 Employee Benefits The union wants substantial increases in life insurance coverage amounts, as well as they want the company to cover more of the premium costs rather than the 50/50 current split. The union wants the company to cover more of the Blue Cross premium costs rather than a 50/50 split. The union wants the employer to cover more of the short term disability premium costs rather than a 50/50 split. The union wants a pension plan, normally around 5% paid entirely by the employer. Cost out all of the above proposals. Additional Requests The union would like to institute an article to limit the employer's ability to contract out work normally done by union members. They would like to have all union work done by union members, and overtime assigned to union members rather than contracting out the work Additional Demands Termination or Severance Pay The current agreement does not provide for any payments to employees who have been permanently laid off or terminated without cause. The union wants a provision added to the agreement to provide for a severance payment to terminated employees. The union would like to achieve a provision that provides for payment of one week's salary for each year of service. The bargaining team is also instructed to pursue an amendment providing that if an employee is laid off they may give up their recall rights and claim severance pay. Hours of Work The current agreement does not contain language with respect to minimum number of hours to be worked in the event that an employee's shift is cancelled. The union must demand that a minimum number of hours be paid in this situation. Table of Contents Bargaining Simulation Page ...3 A. Exercise Description B. Collective Bargaining Simulation Assignment .4 C. Directions of Exercise... 5 7 D. Background of Welby Gardening Equipment Ltd.... E. Financial Information 9 12 14 F. General Information G. Issues Arising Under the Current Collective Agreement H. Articles to be Negotiated. 1. Bargaining Details and Costing... 16 17 - + 9 Page view A Read aloud V Draw Bargaining Simulation A. EXERCISE DESCRIPTION You are a member of the Management or Union Team; the collective agreement is about to expire, and you are required to engage in collective bargaining. You will analyze the collective agreement and confidential information for your side only and identify areas where the union and the employer would like to see changes and additions to the collective agreement. You will prepare demands and proposals for the upcoming negotiation The purpose of the exercise is to: a. Have students identify and prepare different potential proposals b. Help students develop a negotiation strategy c. Help you understand the forces which shape collective bargaining. d. Reflect on an agreement and identify what would be potentially beneficial for your side and what may be problematic. 2. Your instructor will assign you a union team or to a management role to prepare for 3. Your individual objectives include: a. Prepare proposals for your side that will satisfy the interests of your stakeholders b. Develop a strategy that will help you to maximize your gains while keeping the working relationship intact and would avoid a strike or lockout B. COLLECTIVE BARGAINING SIMULATION ASSIGNMENT (30% of final mark) 1. Individual Strategy Report (20%) Each student will be assigned to the role of Management or Union. You will develop proposals for the upcoming bargaining session that will maximize the gains for your stakeholders and satisfy their needs. You will support your proposal with relevant market research, and determine the costs associated with your proposals. You will then identify what concerns the other side may have with each of your proposals. You will be asked to identify a new contract terms that will benefit your side. Again, identifying concerns that the other side may have. You will articulate a strategy to approach the negotiation, to achieve your goals. 2. Individual Final Report (10%) This report will capture an analysis of the final negotiated settlement. You will be given a final settlement by the instructor, you can assume that the negotiation had already taken place. You will discuss the overall desirability of the final settlement and discuss future implications of this settlement for both the union and employer. - + D Page view A Read aloud Draw C. DIRCTIONS FOR THE EXCERCISE In this exercise you have considerable leeway as to sources of information you may use. You may want to refer to outside readings and industry statistics for general background material. If you use outside information, it must not conflict with information supplied in these exercise notes. It is helpful to have completed research of the Alberta marketplace, Alberta Employment Standards and other collective agreements to bolster your arguments. Collective Agreement Bargaining Steps Individual Strategy Assignment (20%) 1) Working independently. You will develop proposals for the upcoming bargaining session that will maximize the gains for your stakeholders and satisfy their needs. You will place your proposals and proposed language into the template chart. 2) You will provide your supporting evidence into the template chart. The supporting evidence is information from the external market, or other collective agreements that justify your proposal as reasonable and necessary. Utilize rational and proof from the Alberta market (other collective agreements, other external sources of Information) that justify your proposal 3) You will calculate any increased costs associated with your proposal. 4) You will then identify what concerns the other side may have with each of your proposals and a potential counter proposal. Also populating the template chart, 5) You will be asked to identify one new contract term that will benefit your side. Again, identifying any increased costs, supporting evidence or concerns that the other side may have 6) Employers may only propose to maintain the current collective agreement language on two monetary articles, otherwise they must propose an increase or decrease in 7) You will articulate a strategy to approach the negotiation, to achieve your goals. conto, ON Auto + ED Page view A Read aloud Draw N Collective Agreement Bargaining Steps Individual Strategy Assignment (20%) 1) Working independently. You will develop proposals for the upcoming bargaining session that will maximize the gains for your stakeholders and satisfy their needs. You will place your proposals and proposed language into the template chart. 2) You will provide your supporting evidence into the template chart. The supporting evidence is information from the external market, or other collective agreements that justify your proposal as reasonable and necessary. Utilize rational and proof from the Alberta market (other collective agreements, other external sources of information) that justify your proposal. 3) You will calculate any increased costs associated with your proposal. 4) You will then identify what concerns the other side may have with each of your proposals and a potential counter proposal. Also populating the template chart. 5) You will be asked to identify one new contract term that will benefit your side. Again, identifying any increased costs, supporting evidence or concerns that the other side may have. 6) Employers may only propose to maintain the current collective agreement language on two monetary articles, otherwise they must propose an increase or decrease in costs 7) You will articulate a strategy to approach the negotiation, to achieve your goals. 8) All information will be placed into the Individual Strategy Template and submitted no later than the due date, late assignments will not be accepted Individual Final Report (10%) 1) You will then create a Final Negotiation Report. 2) You will be given the final agreement which you can assume was negotiat the parties. You will need to calculate the associated costs of the agreeme a debrief of the negotiation answering the following questions: From your original perspective as either the union or employer, review the settler and the following: 1) Insightful review of each negotiated collective agreement section. How close to your proposal was the actual final settlement? What might have been the strategy involved in the settlement? Why might the parties have decided on a particular clause? 2) Overall statement of desirability of the entire settlement. Do you feel your side got a good deal? Why? Were there any surprises, are there any problems with the deal? 3) Overall future implications of the entire settlement. What does this settlement mean for the parties going forward? How might this settlement affect the relationship of the parties in the future? How might this settlement affect the operations of Welby in the future? This report should be written individually. Please space and a half the report, Spelling, grammar and mechanics are important, deductions will be made for errors to a maximum of 10% Appropriate length is between 3-6 pages. 3) Overall future implications of the entire settlement. What does this settlement mean for the parties going forward? How might this settlement affect the relationship of the parties in the future? How might this settlement affect the operations of Welby in the future? This report should be written individually. Please space and a half the report, Speling, grammar and mechanics are important, deductions will be made for errors to a maximum of 10% Appropriate length is between 3-6 pages. Should you utilize any external resources please ensure that they are correctly cited using APA format with a reference page. D. BACKGROUND OF WELBY'S GARDENDING EQUIPMENT Ltd. Company History Welby's is a private family run business that makes metal gardening equipment. They produce all products on site at their shop in Edmonton, Alberta. Welby specializes in high quality products with a focus on ergonomics. They have several different models of shovels, spades, hoes, pitch forks, post hole diggers, rakes, and tampers that they sell to retail stores. The company was founded by Edward Welby who came to Canada from Scotland, 45 years ago. Edward was an avid garden and was disappointed by the poor-quality tools that he found in his local hardware store. He found the tools did not stand up to the rigors of the Canadian weather and soil conditions. Overtime Edward worked with his friend and fellow Scot, Dougal McCoy, who was an engineer to develop sturdy, reliable and ergonomically friendly tools. The tools were high quality and utilized sophisticated welding and fastening systems so that shovel heads did not fall off the handle, nor pitchfork tines break The company grew very quickly in the years from 2010 to 2015 as interest in gardening expanded and demand for good quality tools increased. Sometimes the demand outstripped supply and Welby had to ask workers to work long hours to meet supplier orders. As well Welby had to invest in new equipment and warehouse space to meet the growing demand, so could not invest in a benefit plan for his employees. Employees began to become disgruntled and word of a union organizing campaign spread. Welby was not worried as the company always had a family atmosphere and surely the employees would know that the investments he was making in new equipment and warehouse space was to make employee's lives better In 2016 the Canadian Fabricators Union, already active in Edmonton, ran an organizing campaign at Welby and with the help of some very disgruntled employees, the Union signed up three-quarters of the shop and warehouse employees. The company attempted to stop the organizing drive, but by January 2017 the Fabricators Union were certified as the exclusive bargaining agent for the hourly wage employees. The company was shocked that the employees would join a union, but they managed after 7 months of negotiating to obtain a collective agreement. The company has continued to grow since that time and recently has experience high demand with the increase in home gardening since the pandemic of 2020. Although sales are up profits have not always corresponded and recently problems with sourcing raw materials and delivery problems have plagued the company. Union and Company Relations The first collective agreement negotiations were long and grueling and caused some hard feelings on both sides. With the help of a mediator the parties came up with a first agreement that was only for a year from 2017 to 2018. The company and union have had a second round of bargaining where things were slightly less acrimonious. The company agreed to a bare bones benefit plan in the first agreement but did not concede to the union's demands for significant improvements to the plan in the second round. Edward Welby is getting older and is looking at retirement in the next few years, his daughter Sarah will be taking the helm from her father and has some very strong views about the union. She has repeatedly mentioned that the union is trying to run the business and has their nose in everything. As well she is concerned that with the increased costs in raw materials and that employees have "pie in the sky" expectations of wage and benefit increases in this next round of bargaining. She would like to see some work that Welby currently does in house sent to sub-contractors who may be able to do it more cost effectively. This way Welby tools could be produced cheaper and would be able to compete with the cheaper knock off tools in the big box stores. Sarah is also committed to continuing to purchase new equipment to ensure that the quality of the Welby tools stays as their point of differentiation in the market. Sarah feels that the union has become too demanding in the past with her father and that she would like to change the relationship to remind the union who the boss is! She likes to keep a tight rein on management of the company and is determined that management rights will be enforced. 20Tools%20Negotiation pdf + 2 D Page view A Read aloud | Draw The Fabricators Union wants to ensure that they increase compensation and benefits as well as have a greater say in management decisions. They need to take a more aggressive stance in this round of negotiations. There is a concern that another union has been making overtures to the Welby employees to leave the Fabricators union and join their union. Employees have started to get restless and there are rumors that the other union can guarantee them better wages, benefit plans and more say in decisions. The Fabricators are determined to get substantial increases for their members. coTools%20Negotiation.pdf + D Page view A Read aloud V Draw E. FINANCIAL INFORMATION Welby Gardening Equipment Ltd. Balance Sheet: 31 December last year Assets Cash Marketable securities Accounts Receivable Inventory Prepayments $425,000 632,000 3,578,000 7,136,000 215.000 Total Current Assets Net Building and Equipment $11,986,000 7.522.000 Total Assets $19.508.000 Liabilities Accounts Payable Notes Payable $6,098,000 2.246.000 Total Current Liabilities Mortgage (secured by plant) $8,344,000 $2.780.000 Total Liabilities $11,124,000 Common Stock Retained Earnings $3,346,000 5.038.000 Total Liability and Shareholder Equity $19.508.000 Tools%20Negotiation.pdf + 2 D Page view A Read aloud Draw V Welby Gardening Equipment Ltd Income Statement for Last Calendar Year Sales $36,225,000 Less Cost of Goods Sold Opening Inventory Materials Hourly Labour Manufacturing Overhead Good Available for Sale Less Closing Inventory Total Costs of Goods Sold $3,250,000 17,850,000 6,895,000 4.250.000 32,245,000 3.269.000 28.976.000 Gross Profit $7,249,000 Less Operating Expense Administrative and Office Sales and Distribution Total Operating Expense 2,688,000 2.157.000 4.845.000 Operating Income Other Deductions (Interest) Net Income Before Tax Income Tax, Net Net Income 2,404000 893,000 1,511,000 726.000 $785,000 includes the cost of benefits Tools%20Negotiation.pdf + ID Page view A Read aloud Draw Welby Gardening Equipment Ltd. Net Sales and Income YEAR NET SALES NET INCOME Three years ago Two years ago Last year 26,487,000 30,811,000 36,225,000 2,114,000 1,790,000 785,000 To obtain comparative external financial/statistical information and data you should consult the appropriate website for Statistics Canada and/or the Alberta Government. Some of the following information may be useful: a. b. C. d Settlements for Collective Bargaining Agreements, Alberta Average Earnings in Alberta (Manufacturing) Average Earnings or Hourly Rates in Alberta, Metal Fabricating Industry Edmonton Consumer Price Indexes by month and year to date Any other related and current Alberta wage and benefit information. e. F. GENERAL INFORMATION 1. Welby employees work the following Hours in a day Hours in a week Hours in a year 8 hrs 40 hrs Days of work per year 250 days 2000 hrs 2. The following is a breakdown of the unionized employees in each job classification and corresponding hourly rate. Job Classification Hourly Rate 1 AN Number of Employees in the Classification 26 41 31 12 8 6 6 5 3 2 $21.85 23.25 24.25 25.6 26.85 27.85 28.3 29.1 32.7 35,95 5 6 7 8 9 10 3. Vacation Pay: Employees have the following service with the Company Years of Service Number of Employees Less than one One but less than three Three but less than five Five but less than eight Eight but less than ton 35 26 31 22 7 Welby Gardening Equipment Ltd. Net Sales and Income YEAR NET SALES NET INCOME Three years ago Two years ago Last year 26,487,000 30,811,000 36,225,000 2,114,000 1,790,000 785,000 To obtain comparative external financial/statistical information and data you should consult the appropriate website for Statistics Canada and/or the Alberta Government. Some of the following information may be useful: a b. C d. Settlements for Collective Bargaining Agreements, Alberta Average Earnings in Alberta (Manufacturing) Average Earnings or Hourly Rates in Alberta, Metal Fabricating Industry Edmonton Consumer Price Indexes by month and year to date Any other related and current Alberta wage and benefit information. 35.95 2 3. Vacation Pay: Employees have the following service with the Company: Years of Service Number of Employees Less than one One but less than three Three but less than five Five but less than eight Eight but less than ten Ten but less than fifteen Fifteen but less than twenty Twenty or over 35 26 31 22 7 12 5 2 140 No chango in vacation ontitlement is requested for employees with less than one-year service. Assume these employees have an average of 6 months service. 4. Protection Benefits: The following figures are required for benefit costing and represent monthly premium costs for single and married employees. Assume that 45 employees are single and 95 are family. Single Family a. Alberta Blue Cross premium $37.45 $82.36 b. Group Life Insurance premium $0.42 per $1000 coverage c. Short Term Disability premium $18.36/mo./ee. d. Pension Plan Contributions The most common arrangement here is to contribute a percentage of an employee's basic wage such as 5%. These can be made by the company alone or some cost-sharing arrangement with the employees. Duration of Agreement: You are required to negotiate a one (1) year collective agreement. G. ISSUES ARISING UNDER THE CURRENT COLLECTIVE AGREEMENT This information will help you understand some of what the Management and the Union are looking for with each article you are negotiating. Articles Management would like to change: Article 4 Grievance Procedure Introduce language before the reference to Step 1 that requires a "complaint stage" requiring employee(s) to discuss an issue with the supervisor in an attempt to resolve the matter prior to Step 1. Article 6 Discipline Remove the word "verbal" from the first line in article 6.02 Article 7 Employee Record Replace the time limit for expunging a discipline record from 10 months to 36 months. Article 10 Compensation Change safety shoe allowance period from 12 to 24 months Reduce safety shoe allowance to $100 per year. Article 16 Job Posting Remove the wording "most senior" and replace it with "most qualified", in line 2 on transfers Article 17 Sick Leave Remove any accumulation of unused illness leave days. Article 17 Sick Leave Remove any accumulation of unused illness leave days. Articles the Union wants to change: Article 3 Management Rights Eliminate the language "who has acquired seniority" from the current agreement in 3.02 Article 9 Statutory Holidays More than nine statutory holidays with pay Article 10 Compensation DE 14 1. Increase annual shoe allowance to $185 per year. 2. Basic wage rates to be increased substantially. 3. Increase call in pay from 3 hours Article 11 Shift Premium A substantial increase in shift premium. Article 12 Vacation Much improved vacation benefits. Article 13 Seniority Reduce the probationary period (after which seniority is accumulated) from one hundred and eighty (180) calendar days to (60) calendar days. Article 15 Leaves of Absence Introduce up to 10 paid days for any approved Leave of Absence not currently paid by the employer Leave of absence days X number of employees X average hourly wage rate X 8 hour per day Article 16 Job Postings Eliminate of Article 10.02 Articlo 17 Sick Loavo Increase the number of paid sick days substantially, Article 18: Employee Benefits Employees are very dissatisfied with the health and wellness benefits. As well they are very concerned that they do not have a pension plan. In many other unionized companies having employees doing similar Jobs, these benefits are much better and the company contribution to the cost is much higher. + @ ID Page view A Read aloud Draw H. REQUIRED ARTICLES FOR NEGOTIATION You will be negotiating the following required articles in the collective agreement. This list is not exhaustive and each party to the negotiation may add in additional items for negotiation Art. 3 Art. 4 Art. 6 Art. 7 Art. 9 Art. 10 Art. 11 Art. 12 Art. 13 Art. 15 Art. 16 Art. 17 Art 18 Management Rights Grievance Procedure Discipline Employee Record Statutory Holidays Compensation Shift Premium Vacations with Pay Seniority Leaves of Absence Job Posting Sick Leave Employee Benefits + O Page view l A Read aloud V Draw I BARGAINING DETAILS AND COSTING **Important Information for Calculating Costs** Average hourly wage rate: (number of employees in each classification X classification pay rate) divided by 2000 hours worked per employee $3447.50 (union employees cost per hour/2000 hours per employee per year = $24.63 average hourly wage rate) Total Cost of Payroll: 2,000 hours worked per employee X (number of employees in each classification X classification pay rate) = $6,895,000 2000 hours X $3447.50 (union employees cost per hour) = $6,895,000 Article 9 Additional Statutory Holidays: Additional Statutory Holidays X number of employees X average hourly wage rate X 8 hours per day Article 10 Compensation 10.01 Wage Rates: Increase the total cost of payroll by the percent of increase $6,895,000 X % increase = New Total Cost of Payroll. Or Increase certain classifications only rather than the whole organization 2,000 hours worked per employee X (number of employees in each classification X adjusted classification pay rate) = New Total Cost of Payroll 10.02 Cost of Shoe Allowance: Increase in shoe allowance X 140 employees Article 10 Compensation 10.01 Wage Rates: Increase the total cost of payroll by the percent of increase $6,895,000 X % increase = New Total Cost of Payroll. Or Increase certain classifications only rather than the whole organization. 2,000 hours worked per employee X (number of employees in each classification X adjusted classification pay rate) = New Total Cost of Payroll 10.02 Cost of Shoe Allowance: Increase in shoe allowance X 140 employees 10.03 Cost of Call-in Pay: Call in pay is currently at 3 hours of pay per call. Traditionally the Company has about 85 "call ins" per year. The average wage rate is $24.63. Thus, an increase in pay of 1 hour would be the (1-hour increase X average wage rate) X the number of call ins. 1-hour increase X $24.63 (average hourly wage rate) X 85 (number of call ins) = 1X $24.63 X 85 = $2093.13 Article 11 Shift Premium: 50 employees work the afternoon shift. If you increased the shift premium by $1.00 it would result in an increased cost of 50 employees X increase X 2000 hours per year. 50 employees X $1.00 shift premium increase X 2000 hours per year = $100,000 Article 12 Vacations with Pay: Additional number of weeks of holidays X number of employees X average hourly wage rate X 40 hours per week If you wanted to provide additional weeks to just a certain number of employees simply adjust the number of employees. Article 15 Leaves of Absence Leave of Absence Days X number of employees X average hourly wage rate X 8 hour per day. Article 17 Sick Leave Increased number of paid sick days X number of employees X average hourly wage rate X 8 hour per day. Article 18 Benefits - note you cannot change the premium amounts only the percentage shared between the employer and employees or coverage amount. 18.02 Group Life Insurance: The cost of the premiums is $.42 per month for each $1,000 of coverage. To increase coverage, you can calculate the costs as: premium cost X (increase/1000) X total number of employees X 12 months Thus, an increase of $15,000 worth of coverage would be (0.42 premium cost X 15 increase in coverage) X 140 X 12 = 5.85 X 140 x 12 = $10,584 However, the employer currently only pays half the premium costs so the Article 18 Benefits - note you cannot change the premium amounts only the percentage shared between the employer and employees or coverage amount. 18.02 Group Life Insurance: The cost of the premiums is $.42 per month for each $1,000 of coverage. To increase coverage, you can calculate the costs as: premium cost X (increase/1000) X total number of employees X 12 months Thus, an increase of $15,000 worth of coverage would be (0.42 premium cost X 15 increase in coverage) X 140 X 12 = 5.85 X 140 X 12 = $10,584 However, the employer currently only pays half the premium costs so the total is divided by 0.5 (half) = $10,584/2 or $10,584 *0.5 = $5292.00 18.03 Alberta Blue Cross: The cost per month for single coverage is $37.45. The cost per month for family coverage is $82.36. There are 45 employees with single coverage and 95 employees with family coverage. The current agreement splits the payment of the premiums 50/50, in other words the company pays half the cost of the premiums and the employees pay for the other half. 18 Article 18 Benefits - note you cannot change the premium amounts only the percentage shared between the employer and employees or coverage amount. 18.02 Group Life Insurance: The cost of the premiums is $.42 per month for each $1,000 of coverage. To increase coverage, you can calculate the costs as: premium cost X (increase/1000) X total number of employees X 12 months Thus, an increase of $15,000 worth of coverage would be (0.42 premium cost X 15 increase in coverage) X 140 X 12 = 5.85 X 140 X 12 = $10,584 However, the employer currently only pays half the premium costs so the total is divided by 0.5 (half) = $10,584/2 or $10,584 *0.5 = $5292.00 18.03 Alberta Blue Cross: The cost per month for single coverage is $37.45. The cost per month for family coverage is $82.36. There are 45 employees with single coverage and 95 employees with family coverage. The current agreement splits the payment of the premiums 50/50, in other words the company pays half the cost of the premiums and the employees pay for the other half. 18 If the union and the company agree to a cost sharing of say 80/20, then the additional cost to the company is as follows: (Proposed cost share - existing cost share) X premium cost X number of employees X 12 months. Family premiums = (80% proposed premium coverage - 50% existing premium coverage) X 82.36 pre