Collective Bargaining in Challenging Times

1. Collective Bargaining in Challenging Times VERCRUYSSE MURRAY & CALZONE, P.C. By: Gary S. Fealk

2. The Economics • The economics of the State are driving a need to restructure contracts: • Many employers in the private industry have had success restructuring labor costs • Union leaders and employees need to understand the necessity of change to preserve jobs

3. Goals of the Session • Explain the bargaining process • Highlight differences between the public and private sector • Discuss strategies for achieving bargaining concessions

4. Duty to Bargain in Good Faith • Must meet at reasonable times and places • No take it or leave it proposals • Good faith effort to discuss ideas and proposals • An employer need not agree to any union proposal • Cannot make changes until duty to bargain is fulfilled • Duty to provide information relevant to bargaining

5. Initiating Bargaining • Make sure you give proper notices of contract termination: • Don’t wait for the union to open negotiations • Follow the contract procedure • Private sector notice to FMCS and Bureau of Emp. Relations • Public sector notice to Bureau of Emp. Relations

6. Preparation for Bargaining • Develop and prioritize goals • Reasonable number of goals • Achievable goals • Identify must haves, nice to haves, least important goals • Develop specific proposals • Identify the critical issues (e.g., strike plan) • Private sector → Will replacements be hired? Temporary or permanent? • Public sector → Will/can you seek an injunction?

7. Private vs. Public Sector Bargaining Process • Private and public sector → meet and confer with union and attempt to obtain an agreement • Private sector → if an impasse is reached, a private sector employer may implement its last best offer • Unremedied unfair labor practices can prevent impasse • Consequences of implementation → will likely need to defend ULP charge; strike may also occur

8. Public Sector • Generally, impasse cannot be reached without completing mediation and fact finding • Non-binding mediation • Neutral attempts to help the parties reach an agreement • Either party can request mediation • Other party must file an answer • Most effective when there are a handful of unresolved issues • May take many mediation sessions to exhaust the process

9. Public Sector (cont.) • Non-binding fact-finding • If mediation fails, request fact-finding • Neutral fact-finder conducts a hearing to take testimony and evidence regarding the reasons for the parties’ positions • Fact-finder issues a written, public recommendation regarding a contract settlement on the disputed issues • If the fact-finder’s opinion is rejected, there is a good argument for an impasse so that the final offer can be lawfully implemented

10. Setting the Stage for Concessions • Recognize union politics • Union leaders may understand the situation, but members may not • Don’t be surprised at grandstanding by union leaders to impress bargaining committee • Be willing to share financial information with the union

11. Setting the Stage for Concessions (cont.) • Educate employees before negotiations • Credibility is key: make sure all information provided is accurate • Explain cost-cutting measures that have been tried • Explain the costs that have increased • Explain appropriations cuts • Don’t propose any changes (that has to be done in bargaining)

12. Ideas for Reducing Costs • New employees provided with defined contributions (e.g., 401k) as opposed to defined benefit plan • Possible medical insurance savings • Office visit/emergency room co-pays • Deductibles • Prescription drug co-pays • Caps on dental/vision • Move to PPO, Point of Service, or HMO • Provide a choice of plans

13. Ideas for Reducing Costs (cont.) • Wage freezes • Two-tier wage systems (will not result in immediate savings) • Buy-outs/Buy-downs • Large initial capital outlay, removes higher paid workers • Usually will take a few years to see results

14. The End Any Questions?