Appendix B: Collective Bargaining Simulation: Wally's Janitorial Services Private Team Information: Management Position You and your teammates are the bargaining team for Wally's Janitorial Services (WJS). You have been tasked with negotiating a favourable settlement with the Canadian Union of Service Employees (CUSE), Local 45. You are to select one or more of your members to serve as chief negotiator(s) representing your side in contract negotiations with the bargaining team representing the Union. Members of your team not designated as chief negotiator(s) may function in any capacity that the team decides upon. As indicated in the background information, the previous collective agreement with the Union has expired. As a show of goodwill, WJS management has agreed to continue operations on a day-to-day basis, with the provision that it is free to lock-out the employees at any time so long as the contract is not finalized. Information available to you indicates that the ownership and senior executives would prefer to conclude an agreement, but is willing, if necessary, to engage in a lock-out. You, along with the other members of your team, prefer to conclude a contract rather than call a work stoppage, but you are ready to do the latter if necessary. You are aware of the rising cost of living in Saskatoon but feel the new competition from out of Province firms is a very serious threat. Once WJS can show that they will maintain market position, the issue of a cost of living adjustment may be revisited. Senior leadership has also told you that it does not wish to reduce labour costs by reducing the number of Janitors. To beat the new competition, everyone will be required to work harder and faster. To this end WJS wants to implement a new performance appraisal system that would identify poor performers. In general, the WJS bargaining team wants to avoid a situation where the Collective Agreement impedes WJS's ability to compete and survive in the new business environment. You believe that since the marketplace has drastically changed, the Janitors must accept their share of the burden. WJS leadership wants to be clear that the Janitors are still valued employees who are the lifeblood of the firm. The issues that remain to be settled fall into four categories: 1. Salary 2. Evaluation 3. Benefits 4.Reduction in staff These categories are ranked in order of importance to the ownership and senior leadership at WJS. The management bargaining team's position on specific issues within these categories is also ranked and detailed below. 1. Salary Management is primarily concerned with reducing costs so that it can compete with the lower contract bids from other firms. Management wants the following: 1.1 Management is happy with the current pay dispersion, so pay increases will only be expressed as percentage increases and not as across the board lump sums (the Union also feels this way). Management is convinced that a 5% wage reduction at all levels of Janitors is a fair request in this crucial moment of intense competition. 1.2 If wage increases are unavoidable then no retroactivity.

2. Evaluation The management team at WJS would like to improve the productivity of the Janitors. In order to do so they would like to hire a consultant with expertise in developing a Performance Appraisal Process (PAP). This tool can be used to identify poor performers who may need re-training or discipline/discharge action. Since this is crucial to WJS plan to compete with the new competition it is important to maintain full control of the PAP. Management is less concerned about using the PAP to determine salary, promotion, and lay-offs. However without the ability to identify poor performers and take action, WJS be less competitive. Management wants the following: 2.1 A formal PAP that is designed and executed by management and the consultant of your choice. 2.2 No prohibitions on using the PAP to identify employees that require retraining, discipline, or dismissal. 2.3 Actions taken as a result of the PAP are excluded from the normal Grievance procedure. 3.Benefits At this point in time WJS feels it is inappropriate for the Union to request any additional benefits. Management is willing to offer the following: 3.1 No benefits. 3.2 Management is willing to set up a Pension Fund for the employees where the employees make contributions. WJS will help by transferring automatic deductions from employees' pay. cheques. At a later time Management intends to begin making Employer contributions to the fund; however nothing can be promised at this point. 3.3 As a further sign of commitment to the employees, management is willing to kick off the pension fund with a $100 contribution per employee. 4. Reduction in Staff Management has made several 'unofficial' threats that if a reasonable collective agreement is not reached, the union can expect major lay-offs. Although the Union is expecting Management to demand lay-offs, you would rather keep current Janitor levels, provided they can become much more productive. However management could reduce salary costs if: 4.1 Janitors in the 10th Salary Scale are replaced with new Janitors in the first (0) Salary Scale.