Negotiations Assignment

Question 1
Toronto, Ontario (1035 employees)
Average Hourly Wage Rate $ 30.00
Total Benefit Rate $ 7.50
Total Compensation Rate $ 37.50 (hourly only)

AHWR = $30*1.20 = $36

WIB = 15%*$36 = $5.40
NWIB = 10%*$36 = $3.60
TCR = $36+$5.40+$3.60 = $45

Therefore, if Wilson Bros agrees to the 20% wage proposal presented by the union, the new TCR
for the first year would be $45.

Question 2

There are 800 employees in the union.

Total hours per employee per year = 40*52 = 2080 hours per employee

Pension plan = $500,000

Safety boots = $50*800 = $40,000
3.60*2080*800 = $5,990,400
Total NWIB = $500,000+$40,000+$5,990,400 = $6,530,400

Therefore, the new non-wage impacted benefit would be $6,530,400 after accepting the union’s
proposal.

Question 3

Since Jim does not believe he can agree to the union’s language on contracting out because it
could severely limit the company’s flexibility, Jim should consider using different options to
bargain with the union. Dealing with the issue of outsourcing, the language that must be focused
on is relating to work environment of employees and their compensation. Jim should focus on
offering alternatives in replacement for this removing the outsourcing term in the contract. The
language he should focus on using should relate to the collective agreement. He should make
sure that other options that are equally effective are being offered as a replacement, in order to
avoid disputes between the union and company. One solution for this issue is that Jim can create
an another contract and use that as a negotiating term with the union. He can suggest increasing
wages in order to bargain out this term from the contract. Another solution Jim should consider
offering is instead of laying off employees, the company can find other options such as wage
freeze or unpaid time off. These suggestions can ensure to the union that employees will not be
laid off on the event of outsourcing jobs.

Question 4

In response to the union’s request regarding the technological change clause, Jim can ensure that
employees will not be laid off due to technological changes. Jim can suggest that the company
will offer training to the employees so that they may master the new technological changes so
that they may implement their training into their work. Examples may include training
workshops offsite or hiring an expert to workplace to train employees on using the new
technology. This strategy can benefit employees on the basis that they may develop and learn
new skills that can be put to use. Jim should also note to the union that since they are providing
training to the employees, they reserve the right to terminate those who are unsuccessful in
implementing the training of new technology with their work, as this can severely affect the
company’s work flow. Upon discussing this contract term with the union, Jim should also bring
up the request of including the management’s right clause in the union negotiation so that
management does not lose all decision making power to the union.

Question 5

Union proposal 7 – bulletin board request

In regards to the union’s request on a bulletin board space on company premises, Jim should
negotiate with the union on the specific location and terms regarding the bulletin board. He will
ensure that the union will provide the material at their cost, and will be only allowed to post
notice in that specific area where the bulletin board is located. Jim will find a location where the
union can conduct their business along with a space to include the bulletin board.

Union proposal 8 – deducting union dues

In regards to the union’s request on deducting union dues, Jim will communicate with the union
on the specific details regarding the amount of union dues and the specific date of collection.

Union proposal 9 – probation period decrease from 90 days to 30 days

In regards to the union’s request on decreasing probation periods from 90 days to 30 days, Jim
will inform the union of the reasons why they choose 90 days as their probation period. He will
outline the benefits of their choice. If an agreement cannot be made, Jim will suggest an offer in
the middle, such as a 60-day period. However, the probation period is quite firm to be 90 days
unless union strongly disagrees after hearing the advantages and benefits of implementing the
90-day probation.

Union proposal 10 – rights to add proposals to the list

In regards to the union’s request on having the right to add proposals to the list, Jim will
negotiate with the union by requesting them to obtain management approval obtain adding
proposals to the negotiation. He will also outline how adding new proposals can affect the whole
negotiation process, as well as strain relationships between union and management.

Question 6

Upon experiencing an impasse during negotiations there are important processes that 
management and the union need to follow prior to a legal strike or lockout scenario. Under the 
Labour Relations Act, if both union and management cannot come to an agreement, they can 
contact the government, in which the government will send a mediator to assist with the 
collective agreement negotiations. By using a mediator to help with the negotiation, it will avoid 
the need for a strike or lockout which can affect many people in the company. After following 
the mediations steps with the mediator, if management and union still cannot reach an 
agreement, both groups have the option to enforce a strike or lockout. 

Question 7

Upon mediation, the mediator has offer the details below as the final offer of settlement to 
both parties:

• Instead of a 20% increase on all job classifications, a 10% increase will 
be applied 
• Management will inform the union 3 months before any technology 
changes in the company
• After training employees to implement new technology with their work 
responsibilities, if they are unable to apply and perform as expected, management has 
the right to terminate those employees and outsource their jobs
• Management will provide a space for the union or conduct union 
business and a space for their bulletin board
• Bulletin board materials and cost will be paid by the union
• Probation period for employees will decrease from 90 days to 60 days 
• Union will have the right to add proposals during negotiations ONLY IF
management agrees and approves

Memorandum of Agreement

Between Wilson Brothers and United Food and Commercial Workers

The Employer and Union representatives has agreed to implement the collective agreement 
subject to the following amendments.

Both union and employer has agreed to increase wages of all employees by 10%.

Both union and employer has agreed to the terms of termination on the basis that employees 
cannot perform their job. 

The employer will notify the union 6 months before any technology change is to be 
implemented. 

The employer will provide a space for the union to conduct their union business as well as a 
space for the bulletin board (that will be the cost of the union) 
Both union and employer has agreed that probation period will be reduced from 90 days to 60 
days

Both union and employer agree that union may only add proposals to the negotiation process, 
if approved by the employer.

The parties agree to use their best effort to ensure that their principles will confirm this 
memorandum of agreement. 

Dated this 29th day of May 2019. 

For Employer For the Union

References
Seneca College. (2019). HRM845: [Module 7 Preparing for Negotiations, The Company
Mandate Document]. Retrieved from https://olportal.ontariolearn.com/login.php?college=SE

Seneca College. (2019). HRM845: [Module 9 Negotiations and the Memorandum of

Agreement]. Retrieved from https://olportal.ontariolearn.com/login.php?college=SE

Suffield, L., & Gannon, G. L. (2016). Labour relations. Toronto: Pearson Canada.