Interest-Based Bargaining and the City of Troy, MI

1. Interest-Based Bargaining and the City of Troy, MI ICMA’s 91st Annual Conference Minneapolis Convention Center John Szerlag, City Manager Troy, MI

2. Interest-Based Bargaining and the City of Troy, MI Presentation Outline • Introduction/About Troy • Labor Relations and Troy • IBB: Results in Troy

3. About Troy, MI City Manager Szerlag Reported in 2004 Receipts/Revenues $117,944,690 Expenditures $117,944,690 Fund Balance $ 42,557,359 Supervisor Trowbridge reported in 1827 Receipts/Revenues $72.50 Expenditure $62.81 Balance $ 9.69

4. City of Troy’s Table of Organization

5. Troy’s Advantageous Location -Proximity to Detroit -I-75 Freeway -M-59 Freeway -I-696 Freeway -Major Roads Troy, MI

6. Quick Facts About Troy • Retail Space 7.7 million square feet • Office/Engineering Space 26 million square feet • Industrial Space 19.8 million square feet • Businesses 5,647 • Employment Population 136,000 • Number of Households 31,324 • Average Cost of Housing $282,149 • Median Family Income $90,750 • Residents in 2005 85,000 • Annual City Budget $138 Million

7. Components of Troy’s Success • Professional Management • Stability of Staff and Council • Volunteerism (Including 161 volunteer firefighters) • Fiscal Conservatism • Tax Rate  • Quality Residential Areas • Advantageous Location • High Quality School Districts • Balanced Tax Base • Diverse Community • Downtown Development Authority

8. Some of Troy’s Challenges • Transportation (Lack of Transit) • Retention of Businesses • Maintaining Residential Diversity and Quality • Preservation of Environmental Features • Maintaining Good Management-Employee Relations

9. Labor Relations and Troy 5 Bargaining Units • American Federation of State, County, & Municipal Employees (AFSCME) 81 Mainly Public Works Field Employees • Michigan Association of Police (MAP) 69 Clerical and Non-sworn Police Personnel • Troy Command Officers Association (TCOA) – 34 employees • Troy Fire Staff Officers Association (TFSOA) – 12 employees • Troy Police Officers Association (TPOA) – 101 employees

10. Labor Relations and Troy Total Number of Full-time Employees = 490 Number of Unionized Employees = 297 Percent of Employees Unionized = 60% Contract Negotiation Periods Prior to IBB: • 8-20 meetings (13-90 hours) • 6 months – 2 years

11. Labor Relations and Troy The Move to Interest-Based Bargaining WHEN: Fall of 2000 WHY: Tension and strained union/management relationship following the most recent police contract HOW: Hal Stack, Director Labor Studies Center, WSU • Informational Presentations to Union • Training is part of the IBB process

12. 5 Factors of Negotiations That Should Produce a Range of Reason • Take Community Needs Into Account • Review the Legitimate Interest of Each Side • Resolve Conflicting Interest Fairly • Determine What Is Durable • Produce A Wise Agreement

13. Exploitation By Management Range Of Reason Exploitation By Bargaining Unit Negotiations Range Of Reason Fairness Behavior Management Soft Bargaining Unit Hard Management Hard Bargaining Unit Soft

14. The Most Powerful Human Interests are Basic Human Needs • Job Security • Economic Well-being • Sense of Belonging • Recognition • Self-esteem (Ownership of Tasks)

15. Some Elements of IBB Training Period, Prior to Actual Negotiations • All participants in negotiations attend training together beforehand • In Troy, 2 days Flip Charts and Markers • To document brainstorming Facilitator • Watches time and agenda • Takes notes on flip charts Ground Rules • Rank dropped at the door

16. Sample Ground Rules • Leave the past in the past (no archeological digs) • Don’t make it personal • No BS • Maintain a positive attitude • Treat each other as equals • Be open and honest • What is said in the room stays in the room • Move along as expeditiously as possible • Set agenda for next meeting before adjournment, and time allocated for each item with timekeeper

17. 4 Points of IBB People Separate people from problems Interests Focus on interests, not positions Options Generate a variety of possibilities before deciding what to do Criteria Insist that the outcome be based upon some agreed to objective standard

18. IBB and Feeling of Fairness • Concept and feeling of fairness • Participants believe a process is fair if: • They have opportunity to participate • They have more control over the process • They feel treated with respect

19. Results in Troy: IBB Better Union/Management Relationship All 8 Contracts Resolved: • AFSCME (2 Contracts) - 5 Meetings • MAP (2 Contracts) - 7 Meetings • TCOA (1 Contract) - 4 Meetings • TFSOA (1 Contract) - 4 Meetings • TPOA (2 Contracts) - 7 Meetings

20. Results in Troy: IBB and What People Are Saying • [IBB] was absolutely great…not playing games is great…we were free to say things at the table without being locked into them…all titles were left at the door; everyone was on a level playing field…we went into it with high expectations and those expectations were met. -Lieutenant Keith Lenderman, Staff Fire Lieutenant • The best thing that IBB has done is to reduce the 'Us vs. Them’ mentality. -Carol Anderson, Director, Parks & Recreation

21. Results in Troy: IBB and What People Are Saying • It was a very fair way for us to verbalize our concerns in a…non-confrontational manner and reach an understanding on items of mutual interests. I feel we reached agreement on a contract which is better than what we would have gotten the old way. -Gary Mayer, Police Captain • IBB made us realize that both management and union have essentially the same objectives. –John Szerlag, City Manager

22. Results in Troy: IBB and What People Are Saying • …[IBB] was worthwhile…it is something that every unit should try…I appreciate [the City Manager] going out on a limb and trying it… –Dan Gross, Heavy Equipment Operator • The time spent in negotiations is reduced resulting in timely contracts. -Gary Shripka, Former Assistant City Manager/Services

23. Results in Troy: IBB and What People Are Saying • …people could be honest with one another and explain their true feelings on an issue without fear of reproach. This greatly expanded the level of trust between both groups which in turn eliminated the game playing which dramatically reduced the amount of time spent in negations. –Bill Need, Former Public Works Director • I think IBB worked best at addressing relationship issues (getting parties to talk openly, increasing level of trust, decreasing skepticism). -Peggy Clifton, Human Resources Director

24. Beyond the Bargaining Table • Staff • Council Study Sessions • Boards and Committee Meetings • Ordinance Development • Evaluation Process of City Manager • Development of Organization’s Goals and Objectives

25. Information Sources A primary source for this presentation was Hal Stack’s IBB Training Manual (Director, Labor Studies Center, Wayne State University) On the Web: • National Public Employer Labor Relations Association http://npelra.org/academy/interestbased.asp • Pennsylvania Department of Labor & Industry http://www.li.state.pa.us/lmc/ibb.html • California Public Employers Labor Relationshttp://www.calpelra.org/research/research_29.htm