[Holley] [Chapter bm-d0e4] 11/3/8 15:7:23
APPENDIX A
Collective Bargaining Negotiations Exercise:
QFM Company and IWU
Simulation Contributor: Charlie T. Cook
LEARNING OBJECTIVES
1. To gain an understanding of negotiation preparations, actual negotiations,
and assessment of negotiations’ outcomes.
2. To develop an appreciation for the psychological interactions and the
realism of contract negotiations.
3. To learn the mechanics of give-and-take, compromise, trading issues, and
the art of negotiation.
4. To familiarize the participants with the issues in collective bargaining
and the challenge of writing provisions acceptable to both parties.
5. To realize the importance of and problems associated with teamwork and
intra-organizational bargaining.
6. To gain an appreciation for the application of bargaining theories to
negotiations.
RULES
OF THE
NEGOTIATIONS EXERCISE
1. Participants must not discuss the exercise with anyone except their
assigned team members.
2. Each participant will be assigned a role (organization position) by the
instructor.
3. The negotiations must take place within the framework of the present
company and union at the St. Louis plant. Creativity is encouraged, but a
realistic and pragmatic approach is recommended.
4. Data, materials, and information used for each position or argument on
behalf of a proposal should not be falsified.
5. Each team may have as many meetings outside class as are needed and
desirable.
6. Team members must follow the instructions of their respective team
leaders.
7. All activities of team members should be directed toward negotiating an
agreement that is mutually acceptable and that the parties can live with,
survive on, and prosper under.
666
[Holley] [Chapter bm-d0e4] 11/3/8 15:7:24
APPENDIX A
INSTRUCTIONS
667
TO THE
PARTICIPANT
1. Participants will be assigned to either the management or the union bargaining team. Each team will be responsible for determining the specific
tasks or roles assigned to individual team members.
2. The team leaders—the president of the Industrial Workers United (IWU)
and the labor relations director of Quality Furniture Manufacturing
(QFM) Company—will call separate meetings to discuss and prepare for
the upcoming negotiations and anticipate each other’s proposals. Major
issues for negotiations could include:
a. Union security (e.g., dues checkoff, union shop)
b. Wages, job classes, premiums
c. Management’s rights
d. Promotions and layoffs (use of seniority)
e. Grievance procedure and arbitration
f. Affirmative action plans
g. Pension plans
h. Health insurance
i. Vacations
j. Holidays
k. Sick leave
l. Other issues allowed by instructor
3. In bargaining preparation meetings, each team should study the present
agreement to identify contract language in need of improvement or deletion;
identify key subjects not covered by the expiring contract’s terms which
should be included in any new (renegotiated) labor agreement; determine
relevant information sources and gather materials, data, and information
necessary to support the team’s proposals and positions or address bargaining subjects expected to be raised by the other party during negotiations.
4. Based on study and analysis, each team must determine its bargaining
strategy and goals.
5. Each team must complete the first four columns of Form 1 (on page 678)
and give it to the instructor prior to the first scheduled face-to-face bargaining meeting between union and management teams. (The form should
not be shown to anyone else.)
6. The union and management teams will meet at a time and location specified by the instructor for the purpose of negotiating a new agreement to
replace the expiring contract’s terms.
7. At the first meeting, the union will present and explain its proposals first.
Management will then present its proposals or counterproposals and explain each proposal.
8. Actual negotiations will begin after the proposals are exchanged and will
continue until a new agreement is negotiated and signed or the present
contract expires. The instructor will specify the current contract’s expiration time and date as well as the schedule for formal bargaining meetings
between union and management teams.
[Holley] [Chapter bm-d0e6] 11/3/8 15:7:24
668
APPENDIX A
9. On completion of the negotiations, each team will project the total annual
costs of the new agreement. If assigned by the instructor, the teams will
submit a written agreement.
10. Additional instructions may be given to the participants by the instructor.
SOURCES
OF
MATERIALS
FOR
PREPARATION
Government publications: U.S. Department of Labor, Bureau of Labor Statistics,
Area Wage Surveys, Employment and Earnings, Handbook of Labor Statistics,
Monthly Labor Review, Characteristics of Major Collective Bargaining
Agreements.
U.S. Department of Commerce, U.S. Industrial Outlook (published every
year).
Binder services of Bureau of National Affairs, Inc. (BNA) and Commerce
Clearing House. Especially helpful is the BNA Collective Bargaining Negotiations and Contracts.
Business publications: BusinessWeek and The Wall Street Journal.
Professional labor relations journals: Collective Bargaining Bulletin, Dispute
Resolution Journal, Employee Relations Law Journal, Industrial and Labor
Relations Review, Industrial Relations, Berkeley Journal of Employment and
Labor Law, Journal of Collective Negotiations in the Public Sector, Labor
Law Journal, and Monthly Labor Review.
Proceedings: Labor and Employment Relations Association, Labor Law Developments, National Academy of Arbitrators, and NYU Conference on Labor.
Current labor agreements between companies and unions (as available).
THE FURNITURE MANUFACTURING INDUSTRY
U.S. furniture manufacturers generated about $65 billion in sales of all furniture
types in 2006—the market for household furniture was $31.5 billion.1 The highly
fragmented household furniture industry is segmented into wood furniture (‘‘case
goods’’) at 60 percent of sales, upholstered furniture (primarily sofas and
recliners) at 30 percent of sales, with metal furniture, mattresses, and other products accounting for the remaining ten percent. Case goods include kitchen and
dining room sets, china cabinets, dressers, and home entertainment/media centers. Products are sold either finished or in ready-to-assemble form. Competition
in the industry is among purely domestic manufacturers, domestic manufacturers
that import specific product lines, and foreign producers.2
Global competition has severely impacted the U.S. furniture manufacturing industry for the past decade. In a near-complete reversal, over half of all wood furniture sold in U.S. markets today is imported.3 Once global competitors began rapidly
entering U.S. markets, American manufacturers responded by consolidating or closing U.S. operations, acquiring or building overseas plants, and contracting with foreign companies to produce piece goods 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. Furniture 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 of the value of the shipped products.4
Labor-intensive production operations have been outsourced to China, Vietnam, Indonesia, Taiwan, Eastern Europe, and Mexico to take advantage of lower
[Holley] [Chapter bm-d0e17] 11/3/8 15:7:24
APPENDIX A
669
labor costs. American furniture workers earn an average hourly wage of about
$12 while Chinese workers receive less than $1.5 Employment in the industry
peaked in 2000 and has declined steadily since.6 Conversely, some jobs in the industry are beginning to go begging. Skilled upholsterers, who can earn $35,000
to $45,000 per year doing piece rate work for domestic manufacturers, are in
high demand. Average annual revenue per worker is about $130,000, dropping
to only $100,000 per worker in the household furniture segment.7
The upholstered furniture product segment has, for now, been largely unaffected by the competitive forces in the furniture industry. Almost half of all upholstered items are custom ordered. The extended delivery lead times involved in
foreign manufacturing cannot satisfy customers who want their furniture sooner
rather than later. Competitors in this segment that can efficiently produce and
quickly deliver high quality custom furniture at attractive (and profitable) price
points will have a sustainable competitive advantage that will be difficult for
overseas producers to overcome.8
To control costs and stay profitable, U.S. furniture manufacturers have
adopted the lean manufacturing methods of Toyota Motor Corporation’s production system. This system focuses on continuous improvement in production
processes, elimination of waste, inventory reduction, and speed of delivery.9 Another challenge for the household furniture industry is the urgent necessity for a
radical restructuring of traditional supply and distribution channels to further
lower costs as overseas producers continue to improve their product quality
and distribution efficiencies. Developing strong brands to sell in branded retail
stores will help shield some competitors from direct competitive threats; others
will fall victim to the rising industry trend of ever fewer supply-chain
intermediaries between overseas manufacturers and domestic big-box and
specialty retailers. An accompanying trend is the spreading use of the Internet
by furniture consumers, furniture distributors, and manufacturers, and the use
of e-procurement between manufacturers and suppliers.10
The household furniture industry is headed for difficult times as the U.S. residential housing market’s boom appears to have run its course. Consumers, when
faced with higher mortgage payments as interest rates rise, will likely delay
household furniture purchases, and those who do purchase will have become
much more price sensitive. Until better economic times return, home furniture
retailers are expected to tighten inventories and to narrow product selections
to focus on higher-margin quality goods. These actions and the threat of office
furniture manufacturers diversifying beyond home office products will create increased competition in the industry’s value/activity chain of vendors, suppliers,
and manufacturers. A deteriorating economy and continued increases in better
quality imports will put additional pressure on all industry competitors to reduce
prices to maintain sales and market shares while simultaneously keeping up capacity utilization of manufacturing assets to reduce largely fixed overhead
costs through volume production. If the economy improves, then consumers
will once again begin to furnish their homes.
THE QFM COMPANY
AND THE
UNION
QFM Company began in 1820 in Laconia, New Hampshire, as a family-owned
and operated furniture manufacturer. It was headed by Herman Sweeny, one of
the early settlers in Laconia. The company grew to 30 employees by 1920, but at
that time, Ben Franklin Sweeny, Herman’s son, decided to move the firm to
[Holley] [Chapter bm-d0e17] 11/3/8 15:7:24
670
APPENDIX A
St. Louis, Missouri—a location more central to the firm’s market. Barely surviving the 1930s depression, QFM was one of the first companies to convert its
manufacturing processes to the production of war materials. The company prospered during the war, and afterward, Sweeny decided to expand, sell stock publicly, and focus on producing metal and plastic-laminated furniture. With the
production experience it had gained during the war and with its location some
distance from the predominantly wood-furniture manufacturers, QFM Company
launched a new era for itself in 1946.
By 1970 the St. Louis plant of QFM Company had 1,300 employees and was
producing 450 dinette sets, 200 sets of lawn tables and chairs, and 300 bar stools
and miscellaneous furniture daily. During the 1971–1973 furniture boom with its
expectations of continuous growth, QFM’s new president, Gerald Brooks, decided that a new, modern plant and more diversity in the product line were necessary to meet the expected demand. Taking into consideration location, material
supply, transportation, markets, labor costs, and other factors, Brooks decided to
build the new plant in Dallas, Texas. This plant was to specialize in the new
product lines, and the St. Louis plant was to concentrate only on dinette sets.
In 1972, 200 employees were transferred from St. Louis, and another 200
were hired from the Dallas–Fort Worth area. The Dallas plant started with no
union and 400 employees. In 1993 the founder’s granddaughter, Bethany Sweeny,
became plant manager, and the plant size grew to the current 894-employee
non-union workforce.
The company pays its Dallas employees at least $1 less per hour than it pays
the St. Louis employees in comparable jobs which the company has always attributed to the lower cost of living in the Dallas-Ft. Worth area. The St. Louis plant
continues to produce 450 dinette sets per day, mostly for chain retailers (e.g.,
Wal-Mart, Babcock Home Furnishing, Home Depot), and employs about
1,000 employees in the bargaining unit represented by the IWU. During the
past year the St. Louis plant has begun producing high-end custom wood entertainment centers designed to cater to consumer demand fueled by high definition,
flat panel televisions and home theater sound systems. Initial customer reaction
to the new product line has been positive. Employment levels at the St. Louis
plant have remained relatively stable over the past 30 years.
The company has invested in modernizing plant equipment and production
methods at both the St. Louis and Dallas plants since the mid-1980s. The Dallas
plant has started producing a new high-end product line—dinette sets under the
Eagle brand name aimed at capturing higher income consumer demand. Consumer response has been positive, and the Dallas plant’s future looks very promising. With increasing import competition, the company is investigating the
possibility of locating a production facility in China or Mexico, but no final decision has been reached yet on whether to initiate such an expansion. Throughout
its history, QFM Company has prided itself on being a progressive employer.
The Industrial Workers United (IWU) first sought to represent QFM employees
at the St. Louis, MO plant in 1975. The building of the Dallas plant, increasing employment at the Dallas plant rather than at the St. Louis plant, and
employee complaints about lower than average area wage rates were all issues
in the 1975 representation election campaign at the St. Louis plant. After a heated campaign by both management and the Union, NLRB investigations of unfair
labor practices, and challenged ballots, the union lost the election by a vote of
497 to 481. Two years later, the union returned and won an NLRB-supervised
representation election by a vote of 611 to 375. The election campaign was bitter, and the negotiations that followed were even more contentious. After a
[Holley] [Chapter bm-d0e18] 11/3/8 15:7:25
APPENDIX A
671
six-week strike, the company and union reached agreement on their first labor
contract. There have been nine subsequent contracts negotiated between the parties without the occurrence of a work stoppage. The current labor agreement covering the St. Louis plant is close to its expiration date, prompting the union to
notify management requesting the company renegotiate the terms of the existing
contract. Although company officials have expressed a desire to return to the era
when management and labor trusted each other, worked cooperatively, and
shared mutual goals and benefits, the union’s leaders are taking a wait-and-see
attitude, believing that actions speak louder than words.
The company’s insurance carrier recently announced a 15 percent increase in
the annual health insurance policy premium cost covering bargaining unit members to take effect on April 15, 2008. The current (about to expire) contract calls
for health insurance policy premium costs to be split, with the employer paying
90 percent and the employee the remaining ten percent of the total premium cost.
Currently, 75 percent of bargaining unit members are covered under a family
health care plan at an annual premium cost per employee of $2,970. Twentyfive percent of bargaining unit members have single employee coverage at a
total annual premium cost of $1,412 per employee. Union members believe the
company could easily afford to absorb the announced 15 percent health insurance premium cost increase without having to pass any of the increase along
to bargaining unit members.
The upcoming negotiations will determine the company’s commitment to improving labor relations at the plant. The union believes it is entering negotiations
in a strong bargaining position with 95 percent of the bargaining unit now
enrolled as union members.
References
1. Fast Facts 2007, http://www.exportvirginia.org/FastFacts/
FastFacts_2007/FF_Issues_Furniture_Lumber_07.pdf
2. Bryson, Lanzillotti, Myerberg, Miller, and Tian, ‘‘The
Furniture Industry (Case Goods), The Future of the
Industry, United States versus China,’’ Industry Economics:
March 7, 2003.
3. Vlosky, Richard, ‘‘Dynamics and Trends in US Furniture
Markets,’’ Louisiana State University Agricultural Center,
School of Renewable Natural Resources, June 7, 2005.
4. Al Schuler and Steve Lawser, ‘‘The U.S. Furniture Industry:
Yesterday and Today Will There Be a Tomorrow?’’ Wood
Digest, June 2007.
5. Schmid, John and Romell, Rick, ‘‘Furniture, China, and the
End of an Era,’’ The Morning Journal, February 1, 2004.
6. Industry Overview: Furniture Manufacturing, http://
www.hoovers.com/furniture-manufacturing/–ID__49–/freeind-fr-profile-basic.xhtml, last accessed January 01, 2007.
7. Current Trends in Furniture Production and Sales, AKTRIN
Furniture Information Center, January 2006.
8. www.duke.edu/web/mms190/furniture/dimensions.html.
9. The Impact of Globalization on NC’s Furniture Industries,
(Buehlmann, Urs; Schuler, Al; Nwagbara, Ucheoma) 2002.
10. Jon Chavez, ‘‘Overseas Competition Challenges Furniture
Industry,’’ Toledo Blade, Thursday, March 22, 2007.
[Holley] [Chapter bm-d0e23] 11/3/8 15:7:25
672
APPENDIX A
THE LABOR AGREEMENT BETWEEN QUALITY FURNITURE
MANUFACTURING COMPANY (QFM) AND INDUSTRIAL
WORKERS UNITED (IWU), AFL-CIO
This agreement is entered into on ________ by the Quality Furniture Manufacturing Company (QFM), located in St. Louis, Missouri, and Industrial Workers
United (IWU). This agreement covers employees at the St. Louis plant only.
Article I—Recognition
The company recognizes the IWU as the sole and exclusive collective bargaining agent in all matters pertaining to rates of pay, wages, hours of employment,
and other conditions of employment for all production and maintenance
employees, excluding professional employees, storeroom employees, office clerical employees, guards, and supervisors, as defined in the Labor Management
Relations Act.
Article II—Union Security
The company agrees not to interfere with the right of employees to join the Union
and will not discriminate against employees who are Union members. Employees
in the bargaining unit are completely free to participate in the affairs of the
Union, provided that such activities do not interfere with their work duties and
responsibilities.
While no employee will be required to join the Union as a condition of
employment, union dues will be deducted from any bargaining unit employee’s
pay check, provided proper written notification is given to the Company. At
the end of each pay period, the Company will forward the collected dues,
minus a three percent administrative fee, to the Union.
Article III—Management Rights
All management functions of the enterprise that are not specifically limited by the
express language of this agreement are retained by the Company. The functions
and rights listed here are examples of the exclusive responsibilities retained by the
Company and are not intended as an all-inclusive list: to manage the manufacturing operations and methods of production; to direct the workforce; to decide
what work shall be performed in the plant by subcontractors or by employees;
to schedule working hours (including overtime work); to hire, promote, demote,
and transfer; to suspend, discipline, and discharge for cause; to relieve employees
due to lack of work or for other legitimate reasons; to create and enforce reasonable shop rules and regulations; to establish production standards and rates for
new or changed jobs; to introduce new and improved methods, materials, equipment, and facilities; to change or eliminate existing methods, materials, equipment, and facilities.
Article IV—No Strike and No Lockout
The company agrees that during the life of this agreement there shall be no lockout of bargaining unit employees. The Union agrees that during the life of this
agreement there shall be no strike, work stoppage, slowdown, work refusal,
delay of work, refusal to report for work, or boycott.
[Holley] [Chapter bm-d0e25] 11/3/8 15:7:25
APPENDIX A
Article V—Hours of Work
The normal workweek shall consist of eight (8) hours per day, forty (40) hours per
week, for a five (5) day week, from Monday to Friday. The starting time shall be
made by the Company, and it can be changed by the Company to suit varying conditions of the business. Such changes in working schedules shall be made known to
the Union representative in the plant as far in advance as possible. Employees shall
be notified by a written bulletin or other communications medium.
Article VI—Grievances and Arbitration Procedures
Grievances arising out of the operation and interpretation of this agreement shall
be handled and settled in the following manner:
Step 1: The aggrieved employee and/or shop steward shall discuss the grievance
with his or her supervisor.
Step 2: Should the answer provided by the supervisor 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 shop steward, 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 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
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 a grievance is appealed to arbitration, the Company and the Union shall
attempt to select an arbitrator. If this attempt fails, the Company 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 with and based upon the terms
of this agreement or any written amendment thereto. The arbitrator shall have
no jurisdiction or authority to add to, subtract from, or modify any of the
terms of this agreement.
The Company and local 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 VII—Seniority
‘‘Seniority’’ as used in this agreement shall be the period of continuous service in
the job or plant from the date of the employee’s appointment.
673
[Holley] [Chapter bm-d0e27] 11/3/8 15:7:25
674
APPENDIX A
‘‘Probationary employment’’ consists of a period of one hundred twenty
(120) days of employment.
Layoffs shall be made in the following order:
a. Probationary employees
b. Other employees in order of job seniority
Recall shall be made in the following order:
a. Employees in order of job seniority, given equal job ability
b. Probationary employees
Promotions shall be made on the basis of qualifications, merit, and seniority.
Promotions out of the bargaining unit remain management’s prerogative.
An employee who quits or is discharged for cause shall lose all seniority
rights.
If the Company decides to terminate any operation or job and the employees
remain on layoff for a period of twelve (12) months, the employees shall be considered to have been terminated for cause at the expiration of said twelve
(12)-month period.
Article VIII—Wages and Classifications
Job classifications and a wage schedule setting forth the rates of pay of the various job classifications are included in Schedule A and are hereby made part of
this agreement.
If and when the Company creates a new job classification or modifies, alters,
amends, or combines existing jobs, or revises the skills and responsibilities of a
job, job descriptions will be drawn and a wage rate assigned. The Union shall
have a maximum of five (5) working days to examine the job description to determine whether it accurately describes the principal functions and whether the
pay range is consistent with established job classification pay ranges.
If the Union takes exception, it can review both factors with the Company. If
the issue cannot be resolved, the Union can take the issue through the grievance
procedure.
Job classifications are for pay purposes only and do not pertain to whoever
might perform the work in that classification—unless modified by the terms of
the agreement.
Article IX—Insurance
An employee who has completed ninety (90) days of employment is eligible for
enrollment in the company group insurance programs on the monthly premium
date for each particular insurance coverage that next follows the completion of
ninety (90) days of employment.
1. Group Life Insurance
$20,000
2. Accident and Health Insurance
Accidental Death and Dismemberment
$20,000
Lost income due to a covered condition equals one-half of the employee’s
weekly pay up to a maximum of $150. It is understood and agreed that the cost
of the hospitalization, medical and health insurance, major medical insurance,
accident and health and life insurance will be paid 90 percent (90%) by the Company and 10 percent (10%) by the employee, when subscribed to by the employee.
[Holley] [Chapter bm-d0e31] 11/3/8 15:7:25
APPENDIX A
675
It is understood and agreed that in the event that the Company wishes to change
carriers, there is no obligation to negotiate with the Union prior to instituting the
change.
Employees on medical leave for a period in excess of ninety (90) consecutive
days may continue to be covered under the group insurance program after the
first ninety (90) days, providing the employee pays the total insurance premium.
Article X—Pension Plan
A defined benefit pension plan for bargaining unit employees of the company is
hereby made a part of this agreement. The normal monthly retirement benefit for
all years of service is $30 per month per year of service.
Article XI—Holidays
All employees, after completing six (6) months of service with the Company,
shall be paid eight (8) hours pay for the following holidays:
New Year’s Day
Independence Day
Labor Day
Thanksgiving Day
Day after Thanksgiving Day
Christmas Eve Day
Christmas Day
To be eligible for holiday pay, the employee must have worked the days immediately preceding and following the holiday. Legitimate excuses for absences
will be considered.
Article XII—Vacation
Employees shall qualify for vacation with pay in accordance with the following
(determined June 1 of each year):
Continuous Service
Vacation with Pay
More than 1 but less than 5 years
5 years but less than 10 years
10 years but less than 20 years
20 or more years
1
2
3
4
week
weeks
weeks
weeks
Vacation pay shall be computed on the basis of each employee’s average
weekly earnings from June to June. Payment will be made on the work day
prior to the vacation period.
Article XIII—Sick Leave
A full-time employee is eligible for sick leave after completing six (6) months service 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
[Holley] [Chapter bm-d0e34] 11/3/8 15:7:25
676
APPENDIX A
can be used only for personal illness not covered by workers’ compensation. The
Company retains the right to require a doctor’s certificate as proof that an absence was due to a legitimate injury or illness.
Article XIV—Nondiscrimination
The Company and the Union mutually agree not to discriminate in making decisions and determinations concerning hiring, promotion, employment termination, transfer, compensation, and terms or conditions of employment. Both
parties agree that all such decisions and determinations will be made without regard to race, color, religion, sex, age, disability not related to job performance,
national origin or ancestry, or because an individual is disabled or a Vietnamera veteran.
Article XV—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 XVI—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.
[Holley] [Chapter bm-d0e34] 11/3/8 15:7:25
APPENDIX A
677
Schedule A: Current Wages and Classifications
Wage Grade
1
2
3
4
5
6
7
8
9
10
Job Title
Janitor
Packer
Materials handler
Woodworking machine operator B
Maintenance worker B
Furniture finisher
General laborer
Team assemblers
Industrial truck & tractor operator
Woodworking machine operator A
Welder
Electrician B
Tool grinder
Wood worker, general
Maintenance worker A
Machinists
Inspector
Painter
Electrician A
Lead person
Tool and die maker
Wage Rate
$8.65
9.15
10.50
10.75
10.75
10.80
11.24
11.60
12.81
12.65
13.34
13.35
13.45
13.93
15.40
15.45
15.90
17.20
17.50
18.65
19.68
[Holley] [Chapter bm-d0e3499] 11/3/8 15:7:25
678
APPENDIX A
Form 1: Pre-bargaining Preparation Form
Each bargaining team must complete both parts A and B of Form 1. Part A is for
each team’s own strategic planning and should not be revealed to any other bargaining team. Part B contains your team’s initial written bargaining proposals to
be presented to the other bargaining team with whom you will be negotiating
during the first bargaining meeting. Each bargaining team will turn in a completed copy of Form 1 (parts A & B) to the instructor prior to the initiation of faceto-face bargaining between union and management teams.
In column 1, briefly label the bargaining subject (e.g., wages, holidays, health
insurance, pension, etc.). In column 2, identify the priority rank of that bargaining subject to your bargaining team. In column 3, describe in detail the specific
outcome your bargaining team expects to achieve on each identified bargaining
subject.
Part A
Bargaining Subject Area
Bargaining Priority
(rank in order each subject from 1
to n, with 1 being the highest
priority subject)
Realistic Expected
Bargaining Outcome
[Holley] [Chapter bm-d0e349999] 11/3/8 15:7:25
APPENDIX A
Form 1, 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 first joint negotiation meeting, include the complete, specific, and clear wording of each initial
bargaining subject proposal. Proposals should be stated using the exact contract
language your party would prefer to appear in the labor agreement (contract).
679
[Holley] [Chapter bm-d0e349999] 11/3/8 15:7:25
680
APPENDIX A
Exhibit 1
QFM Company Balance Sheet, 2007
Assets
Current Assets:
Cash
Notes and accounts receivable
Inventories
Prepaid expenses
Total current assets
$
2,420,659
55,972,823
70,720,456
927,138
$130,041,076
Fixed Assets:
Land
Buildings
Machinery and equipment
Total fixed assets
Total assets
$ 11,273,570
28,183,925
22,140,388
61,597,883
$191,638,959
Liabilities and Stockholders’ Investment
Current Liabilities
Notes and accounts payable
Accrued payroll
Taxes (local, state, federal)
Total current liabilities
Stockholders’ Investment
Common stock (common @ $20 per share)
Earned surplus
Total stockholders’ investment and earned surplus
Total liabilities and stockholders’ investment
$ 18,611,307
7,440,556
59,749,921
$ 85,801,784
$ 45,095,086
60,742,089
$105,837,175
$191,638,959
Exhibit 2
QFM Company Income Statement
Net Sales
Costs of Goods Sold
Production (labor, materials, overtime)
Administrative
Sales
Other
Total Cost of Goods Sold
Income before taxes
Taxes (local, state, federal)
Net Income
2006
2007
$216,468,226
$238,115,271
$174,515,138
14,792,253
7,215,085
1,831,306
$198,353,782
18,114,444
5,262,503
$ 12,851,941
$182,314,515
15,806,447
9,469,799
2,077,494
$209,668,255
28,447,016
7,015,580
$ 21,431,436
Exhibit 3
QFM Company Net Sales and Income
2006
2007
2008 (estimated)
Net Sales
Net Income
$216,468,226
238,115,271
254,826,000
12,851,941
21,431,436
26,147,000
[Holley] [Chapter bm-d0e349999] 11/3/8 15:7:26
APPENDIX A
681
Exhibit 4
Number of QFM Production and Maintenance Employees by Seniority in St. Louis and Dallas Plants
Years
St. Louis
Dallas
Less than 1
1–2
3–4
5–6
7–10
11–15
16–20
21–-25
26–30
more than 30
Total
10
45
50
120
165
128
190
105
120
67
1,000
100
150
90
135
165
84
60
58
45
7
894
Exhibit 5
Number of QFM Employees in Each Job Title, by Wage Grade
Wage Grade
1
2
3
4
5
6
7
8
9
10
TOTAL
Job Title
St. Louis
Dallas
Janitor
Packer
Materials handler
Woodworking machine operator B
Furniture finisher
Maintenance worker B
General laborer
Team assemblers
Industrial truck & tractor operator
Woodworking machine operator A
Welder
Electrician B
Tool grinder
Woodworker, general
Maintenance worker A
Machinists
Inspector
Painter
Electrician A
Lead person
Tool and die maker
12
66
60
85
72
15
56
305
20
45
16
14
5
85
10
15
29
35
15
28
12
1,000
9
54
53
68
68
13
49
295
18
40
13
10
5
78
8
12
25
32
12
24
8
894
[Holley] [Chapter bm-d0e349999] 11/3/8 15:7:26
682
APPENDIX A
Exhibit 6
Average Hourly Earnings, Excluding Overtime, for Selected Industries (Not Seasonally Adjusted)
NAICS
N/A
N/A
321
327
331
332
333
334
335
336
337
339
N/A
311
312
313
314
315
316
322
323
324
325
326
Industry
2004
2005
2006
2007
Manufacturing
Durable Goods
Wood Products
Nonmetallic Mineral Products
Primary Metals
Fabricated Metal Products
Machinery
Computer and Electronic Products
Electrical Equipment and Appliances
Transportation Equipment
Furniture and Related Products
Miscellaneous Manufacturing
Nondurable Goods
Food Manufacturing
Beverage and Tobacco Products
Textile Mills
Textile Product Mills
Apparel
Leather and Allied Products
Paper and Paper Products
Printing and Related Support Activities
Petroleum and Coal Products
Chemicals
Plastics and Rubber Products
15.29
15.92
12.36
15.17
17.26
14.51
15.78
16.52
14.20
20.17
12.58
13.30
14.27
12.25
18.16
11.50
10.97
9.47
11.32
16.83
15.05
22.35
18.13
13.88
15.68
16.41
12.52
15.45
17.65
14.97
16.07
17.61
14.56
20.80
12.92
13.50
14.47
12.30
17.52
11.80
11.04
9.96
11.19
16.88
15.10
22.37
18.65
14.09
15.95
16.78
12.78
15.56
18.05
15.33
16.31
18.71
14.80
21.19
13.28
13.84
14.54
12.39
17.04
11.99
11.32
10.29
10.94
16.89
15.12
22.18
18.69
14.27
16.52
17.43
13.07
15.83
18.49
15.72
16.93
19.32
15.29
21.94
13.75
14.27
14.97
12.82
16.69
12.65
11.40
10.66
11.79
17.33
15.71
23.42
18.65
14.66
Preliminary
SOURCE: Bureau of Labor Statistics, U.S. Department of Labor, on the Internet at http://data.bls.gov/PDQ/outside.jsp?survey=ce (visited October 11, 2007).
[Holley] [Chapter bm-d0e349999] 11/3/8 15:7:26
APPENDIX A
683
Exhibit 7
Mean Hourly Earnings of Selected Manufacturing Plant Employees in Texas and Missouri, November, 2004
Job Titles
Team assemblers
Wood worker, general
Electrician
Inspector
Woodworking machine operator
Inspectors
Industrial truck and tractor operator
Furniture finisher
Packer
Material handler
Welder
Janitor
Laborer
Texas
Missouri
$9.94
$7.93
$17.86
$14.71
$9.57
$14.71
$11.48
$10.10
$8.27
$9.58
$12.67
$8.25
$8.53
$11.90
$14.60
$24.16
$16.23
$11.02
$16.23
$13.00
$11.53
$9.14
$10.95
$13.39
$9.14
$11.97
SOURCE: U.S. Department of Labor, Bureau of Labor Statistics, November 2004 State Occupational Employment and Wage Estimates at http://www.bls.gov/oes/
current/oes_tx.htm and http://www.bls.gov/oes/current/oes_mo.htm.
Exhibit 8
Consumer Price Index (CPI) for Urban Wage Earners and Clerical Workers Base Period: 1982–84 = 100 (Not Seasonally Adjusted)
Index
Dallas-Fort Worth, Texas
Saint Louis, Missouri–Illinois Area
Percent Change in Index from Previous Year
Dallas-Fort Worth, Texas
Saint Louis, Missouri–Illinois Area
2007
2004
2005
2006
179.0
178.7
185.6
184.9
191.6
188.5
2004
2005
2006
2007
1.8
4.0
3.7
3.5
3.2
1.9
.60
1.3
192.9
190.9
Preliminary
SOURCE: Bureau of Labor Statistics, U.S. Department of Labor, on the Internet at http://www.bls.gov/cpi/home.htm (visited October 11, 2007).
[Holley] [Chapter bm-d0e349999] 11/3/8 15:7:26
684
APPENDIX A
Exhibit 9
Average Hourly and Weekly Earnings for All Private Workers and for Production Workers (Not Seasonally Adjusted)
Hourly Earnings
NAICS
Industry
N/A
N/A
3371
Total Private
Manufacturing
Household and Institutional Furniture
2004
2005
2006
2007
15.69
16.15
12.81
16.13
16.56
13.15
16.76
16.80
13.65
17.63
17.39
14.07
Average Weekly Earnings
NAICS
Industry
2004
2005
2006
2007
N/A
N/A
3371
Total Private
Manufacturing
Household and Institutional Furniture
529.09
658.59
510.78
544.33
673.37
517.27
567.87
690.83
524.27
602.95
725.16
557.17
Average Weekly Hours
NAICS
Industry
2004
2005
2006
2007
N/A
N/A
3371
Total Private
Manufacturing
Household and Institutional Furniture
33.7
40.8
39.9
33.8
40.7
39.4
33.9
41.1
38.4
34.2
41.7
39.6
Preliminary
SOURCE: Bureau of Labor Statistics, U.S. Department of Labor, on the Internet at http://data.bls.gov/PDQ/outside.jsp?survey=ce (visited October 11, 2007).