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Mgmt 583

Mgmt 583. Chapter 9: Wage and Benefit Bargaining Fall 2008. Components of the CBA. Wage Issues Wage & effort. Benefits Premium Pay Nonwage Issues Union security (level of compulsory membership) Individual security/ seniority Management rights Discipline/discharge.

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Mgmt 583

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  1. Mgmt 583 Chapter 9: Wage and Benefit Bargaining Fall 2008

  2. Components of the CBA • Wage Issues • Wage & effort. • Benefits • Premium Pay • Nonwage Issues • Union security (level of compulsory membership) • Individual security/ seniority • Management rights • Discipline/discharge

  3. Components of the CBA • Nonwage Issues (continued) • No strike/no lockout • Contract term/duration • Contract administration

  4. Bases for Union Wage Demands • Equity • Internal Equity- Unions expect to meet or exceed levels for nonunion jobs in the firm. • Unions expect uniformity in how much workers make doing the same jobs at other plant locations in the company. • Ability to Pay – if the company makes a profit, they can afford to pay more. • Standard of Living – unions expect the purchasing power of worker’s wages to be maintained. • COLAs

  5. Union’s Preparations for Wages Issues • After certification (or recognition) the parties begin preparations for contract negotiations. • Union Preparations • Research management’s ability to pay. • Research BU’s ability to strike. • Can they muster a strike vote? • Does the national have a sufficient strike fund?

  6. Union’s Preparations for Wages Issues • How well is management prepared for a strike? • Data and information is collected to support bargaining demands. • Employer’s profitability. • Employer’s sales growth. • Industry-wide trends. • National union’s agenda. • Member’s agenda’s/desires.

  7. Management Expectations • Quid pro quo • Never give something without getting something in exchange. • Cost minimization • Desire to remain competitive

  8. Management’s Preparations for Wages Issues • Management’s Preparations • Top level management establishes bargaining limits. • Predict probable union demands. • Anticipated demand will under go thorough cost analysis. Three most important words in collective bargaining: • Cost! • Cost! • Cost!

  9. Management’s Preparations for Wages Issues • Data and information is collected to support bargaining demands. • Industry wage rates. • Local labor market wage rates. • Cost of living information. • Cost of benefits. • Cost of overtime. • Industry/market trends. • Other relevant economic information.

  10. Wage Issues • Wage and Effort Clause • Base wage • Pay Scales and Pay Systems • Two-tier systems • Cost of Living Adjustments (COLAs) • Not not forget effort!

  11. Wage Issues • Premium Pay • Overtime • Rate • Eligibility • Shift Differentials • Holiday pay • Hazardous duty pay

  12. Wage Issues • Contingent Benefits • Retirement • Funded v. nonfunded • Defined benefit v. defined contribution • Vesting • Eligibility to draw benefit • SUBs • Severance pay

  13. Supplemental Unemployment Benefits (SUB) • Employer supplements state unemployment benefits to ensure a guaranteed level of income. • Example: A union negotiates an 80% SUB in the CBA. • An employee made weekly salary of $500 (80% = $400) • The maximum Weekly Benefit Amount (WBA) allowed in Mississippi in 2008 is $230.00. Salary $500 SUB $170 State Unemployment $230 $400

  14. Wage Issues • Contingent Benefits (continued) • Time off • Vacations • Holidays • Military leave • Jury duty • Sick leave • Childcare/eldercare

  15. Wage Issues • Contingent Benefits (continued) • Health insurance • Eligibility • Dependent coverage • Deductibles • Co-payments • Dental insurance • Life insurance

  16. Wage Issues • Pay Structure – the wage rates for different jobs. • Pay Form – how the compensation is to be received. • Cash • Automatic deposit • Insurance payments • Deferred income

  17. Wage Issues • Pay System – establishes methods by which it is determined what each individual employee will earn in his/her job. • Premium pay • Productivity bonuses • Profit sharing • Gainsharing • SUBs

  18. Wage Issues • Pay System – cont’d • Pay for Time Not Worked • Paid holidays • Vacations • Military leave • Jury duty • Paid sick leave • Longevity Pay

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