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Labor Relations and Negotiations

Labor Relations and Negotiations

Student Project/Assessment


Bayside Foods is a large grocery retail outlet in the community.  The city has a population of 50,000.  Bayside Foods has approx. 210 employees that fill 144 positions.  There is a vast array of employment opportunities in the area, including retail, health care, education, banking, insurance, manufacturing, restaurants, fast foods and government.  The hospital and manufacturing companies in the area have union representation.  There are two separate unions representing these industries.  Health Care Representatives (HCR) is the union representing the hospital and Workers Choice (WC) is the union representing the manufacturing companies.  The unemployment rate in the area currently is low, around 5%.  With a lower unemployment rate, there is competition around the area for good employees.


Bayside Food is the largest employer in the retail food and grocery market for the area. The store is open 24 hours a day, 7 days a week.  A summary of the positions, number of FTE’s (Full Time Equivalents) and salaries are as follows:


Executive Director           1.0    $135,000

Finance Director              1.0        90,000

Operations Director         1.0        80,000

Department Managers    10.0      483,000

Business Staff                  6.0      201,000

Janitorial Staff                12.0     300,000

Storeroom                       15.0     414,000

Customer Service           14.0     408,000

Clerks                             84.0   2,447,000


Department managers:  Responsible for a specific area, such as produce, bakery, meats, dairy, frozen foods, etc.  There are a total of 10 departments, which each having a manager. Responsible for managing staff, ordering inventory for their department, managing their budget, working with vendors, working with customers, working on promotional activities for their departments


Business Staff:  Includes all business functions such as payroll, accounts payable, accounting


Janitorial:  Responsible for cleaning and sanitation of the store


Storeroom:  Responsible for receiving goods off the trucks, stocking in the storeroom


Customer Service:  Responsible for checkouts


Clerks:  Work in a specific department, such as meat, produce, bakery, etc.  Each department has clerks, who work under the department managers.  Clerks are staffed 24 hours a day/ 7 days a week.  There are 3 staffed every day during first shift, 2 staffed every day on 2nd shift and 1 staffed every day on 3rd shift for each department.  They are responsible for stocking the products in their department, and assisting customers. They rotate products in their area so product does not spoil or is not outdated.


Total budget for Bayside foods for the upcoming year is $13,000,000.  Of this, $4,558,000 is salaries (detail above) and $1,140,000 is employee benefits.  The detail of these benefits paid by the company is:  Health insurance-$393,000, Retirement Fund -183,000 (contributes 4% of salaries on employee behalf), FICA-$348,000 (required benefit-7.65% of salaries), Workmen’s Compensation premiums-$100,000 (required benefit), Unemployment compensation premiums (required) $20,000, Disability Insurance $96,000.  Employees receive 1 week vacation after 1 year, 2 weeks of vacation for years 2-7, and 3 weeks of vacation after 3 weeks.  Vacation benefits are for full time employees.  Part time employees do not receive vacation.  All management positions are full time.  The remaining job categories have both full time and part time positions.  The store employees a number of students.  Each department manager is responsible for hiring and staffing of their area.  No sick time is currently available, so if someone is sick or needs time off, they can take a vacation day or no pay.  Part time staff fills in for full time staff when they are on vacation.  The store closes on Christmas Day and Thanksgiving.  Full time staff receives holiday pay for these days, part time staff do not.  Full time staff also receives holiday pay for Memorial Day, Labor Day, July Fourth, and New Year’s Day.  Part time staff work these days, and are paid for working but do not receive anything extra for holiday pay.  Current premiums for health insurance that staff pays are $200 per month for full time staff for family plan and $100 per month for full time staff for a single plan.  Part time staff is not eligible for health insurance.


The current shifts are:  Days 8:00 am to 4:30 pm, 2nd shift is 4:00 pm to 12:30 am, and 3rd shift is 12:00 am to 8:30 am.  Included in the shift is a 30 minute unpaid meal break and a 15 minute paid break for the full 8 hour shift.  Part time staff generally works 4 to 5 hours shifts on the weekdays and 8 hour shifts on the weekends and holidays.


A recent vote went through and the WC Union was voted in and will be effective to represent employees at the start of the year.  Potential bargaining units are janitorial, storeroom and clerks.  Many of these positions are staffed with part time employees.  The customer service staff is not in yet, and management is trying to keep them out.  The union is still trying to get them in.  The union dues for the staff in the union will be $30 a month and all staff being represented by the union are required to join and start paying dues upon being hired.


In addition to the budget indicated above, management has indicated there is $350,000 available for increases in salaries and benefits.


Management and Union will be negotiating a contract that will be effective January 1.  It is now July 1. This is the first contract.  The only knowns for the contract at this point are the union dues indicated above and the three groups that are for sure part of the union.




Project Assignment:


Prepare a union contract.  A management planning schedule should also be included.  The student will determine the content of the contract and what the negotiated items are.  The amount available for the entire organization for salary and benefits is indicated above.  A summary should be included in the project that indicates how the available funds will be distributed between salaries and benefits and between union and nonunion employees.  Be creative.  As the job market is competitive, the benefits that are available may not be the best benefits.  This is an opportunity for the creation of new and additional benefits.



Recommended layout for the project:


  • Summary describing the negotiation process (estimated 2-4 pages)
  • Management Planning for Contract Negotiations Document (estimated 1 to 2 pages)
  • Summary of the distribution of the available funds for salaries and benefits ($350,000). Indicate in this document the nonunion group of staff and the union group of staff.  (estimated 1 page)
  • Union Contract (number of pages will vary depending on what all is negotiated. Pages 387-405 in the text has an example).It is estimated this contract will be shorter than the contract sample in the text, but still should include detail.  (Estimate 9-13 ages)



The final document should be a formal document that appears professionally prepared.



The final project/assessment is due at the close of the course in week 8.  The assignment will not be accepted after this time.  Please post to the drop box in week 8 in the assignment section designated for this assignment.







Last Updated on February 10, 2019

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