Unions_vs._Corporations

Unions vs. Corporations The clock is ticking; the stroke of midnight will signify that the contract for the two major Colorado grocery retail clerks has expired. Associates who work for King Soopers and Safeway are waiting with bated breath to learn what their fate will be. They’ve been through contract negotiations many times before, yet however many times the workers have gone through this, it is never easy. Rumors abound (no one truly knows all the facts), and tensions are rising. The Union and the Corporations hold the lives of the employees’ in the palms of their hands and until things are settled, no one will rest easily. No one wants a strike, and even more so do not want a lockout which is what King Soopers is threatening to do if Safeway votes to strike. King Soopers and Safeway have already entered into an agreement allowing one to lock out its workers if the other loses its workers to a strike. Local 7 has said its members will receive $200 a week if they picket full-time until the union's strike fund runs out. The union will not disclose the size of Local 7's strike fund but said the union paid $10 million in such benefits during the 1996 strike. Either way, none will win if a strike/lockout ensues. King Soopers, Colorado’s own full service retail grocery chain is one of the key players in this scenario. The grocery chain opened the doors of its first store in June of 1947 by founder Lloyd King. Today, the company employs over 19,000 people and has 141 stores throughout the state of Colorado. King Soopers’ company president, Russ Dispense is a Denver native who began his career with Kings in 1965 as a courtesy clerk. Although he has worked for different divisions within Kroger, including president of Smiths, another division of Kroger located in Salt Lake City, returning to Colorado to take the helm of King Soopers in 2001 was a homecoming to him. Mr. Dispense is responsible for, “operations, merchandising, everything associated with the division's performance and most if not all of the merchandising decisions that are made at the division level,” according to Gary Rhodes, spokesman for King Soopers, (Brand, 2001, p. 5). UFCW (United Food Commercial Workers) Local 7 represents over 20,000 workers for Safeway and King Soopers and is the largest union within the American Federation of Labor and Congress of Industrial Organizations (AFL-CIO), (UFCW - Local 7, n.d.). Ernie Duran Jr. is the chief negotiator and president of UFCW Local 7 in Colorado. As president of United Food and Commercial Workers Local 7, the lawyer has been at the center of an often contentious negotiation between those workers and their bosses at King Soopers and Safeway. He is often viewed as a thorn in the side of many corporations and happily accepts this description. Some corporate representatives believe Duran's “fiery rhetoric and give- nothing negotiating tactics are aimed more at tearing companies down rather than helping the workers they employ,”(Arrellano, 2004, p. 1). “The sole purpose for our (UFCW Local 7’s) existence is to fight for workers,” Duran stated in a message to members on Local 7's website, “I have dedicated my working life to the United Food and Commercial Workers union” (Vuong, 2008, p. 7). According to Leadership in Organizations, Mr. Duran most likely uses a Power-Influence Approach to his lead the UFCW and its members. With this approach, power is viewed as, “important, not only for influencing subordinates, but also for influencing peers, superiors and people outside the organization such as clients and suppliers,” (Yukl, 2006, p. 14). As a leader, Mr. Duran uses his power to achieve organizational, group and individual goals, however he is often seen by corporations as a charismatic ‘rebel-rouser’ who uses his influence to induce people to strike by making misleading statements and stretching the truth. UFCW and King Soopers both have strong leaders who want what is best, not only for the company but for the employees as well. Wages, health care, and pensions are at issue between the workers and the company. The union is contending that grocery chains are pushing for concessions despite profits; “As people eat out less and buy food to cook at home” (Associated Press [AP], 2009’, ¶ 13). However, on the other hand, King Soopers contends “it faces competitive pressure from non-union or low-cost chains like Wal-Mart, plus rising health care costs and the effect of the economy on the value of pension funds” (AP, ¶ 14). Issues such as health care and pensions have been at the forefront of contract negotiations before, however this is the first time union workers have also faced worsened economic conditions such as what are occurring currently. In 1987, King Soopers workers went on strike for 29 days before a settlement was reached. In that settlement, the workers received a pay cut of $1.00 an hour and also lost their evening premiums, however the other premium pays were scaled back but were not eliminated (which was an original proposition from the company). In 1996, another strike ensued. This time King Soopers workers were out on strike for 42 days while Safeway workers were locked out during this period. Through negotiations the UFCW preserved Maintenance of Benefits and wages and pension contributions were increased, however an agreement was not made until a Federal Mediator was brought in to draw up the contract. The proposal made by King Soopers was developed to fit the current economic conditions. The severe decline in the stock market has reduced fund assets by many millions of dollars and King Soopers has developed the proposal in order to stabilize the Pension Fund, which has been very difficult. According to King Soopers, the only way to stabilize the fund is to 1) increase company contributions – which is what they are doing – and 2) adjust the future retirement benefits – which is what they are proposing. The proposal “protects the fundamentals of the employees’ retirements and also makes changes to stabilize the fund,” (King Soopers, 2009, p. 2). The proposals also would have risen the minimum retirement age for Local 7 members from 50 to 55 and end a $200-a-month supplemental payment for retirees between the ages of 60 and 62. However, the union said the offer also would cut future pension benefits by up to 60 percent. When necessary, federal mediators are used to resolve a broad range of conflicts within a variety of settings. In the case of contract negotiations between Local 7 and King Soopers, a mediator may be essential to resolving the conflict. Mediators all follow the Model Standards of Conduct for Mediators, which are “designed to serve as fundamental ethical guidelines for persons mediating in all practice contexts. They serve three primary goals: to guide the conduct of mediators; to inform the mediating parties; and to promote public confidence in mediation as a process for resolving disputes. Mediation is a process in which an impartial third party facilitates communication and negotiation and promotes voluntary decision making by the parties to the dispute. Mediation serves various purposes, including providing the opportunity for parties to define and clarify issues, understand different perspectives, identify interests, explore and assess possible solutions, and reach mutually satisfactory agreements, when desired” (Federal Interagency ADR Working Group Steering Committeefinal, 2006, p. 3). According to the guide for federal employee mediators, “A mediator shall conduct a mediation based on the principle of party self-determination. Self-determination is the act of coming to a voluntary, uncoerced decision in which each party makes free and informed choices as to process and outcome,” (Federal Interagency ADR Working Group Steering Committeefinal, 2006, p. 4). He or she cannot conduct mediation if the mediation cannot be done in an impartial manner. Impartiality means freedom from favoritism, bias or prejudice. If at any time a mediator is unable to conduct mediation in an impartial manner, the mediator shall withdraw. The good news is the contract has been extended for another 20 days; however the deadline will once again approach. The livelihoods of all workers lay in the balance, so it is crucial that an agreement be made with or without the help of a federal mediator. Regardless, no one will benefit if a strike/lockout occurs; neither the workers nor the companies. References Arrellano, K. (2004, November 17). Fighter for the union Ernest Duran Jr.’s tenacity a force in grocery talks. The Denver Post, p. 1. Associated Press (2009’). King Soopers workers reject latest contract offer. Retrieved May 12, 2009, from http://www.kktv.com/news/headlines/44632117.html Brand, R. (2001, February 28). Denver native Russ Dispense to head King Soopers. Rocky Mountain News, p. 5b.. FEDERAL INTERAGENCY ADR WORKING GROUPSTEERING COMMITTEEFINAL (2006). A guide for federal employee mediators. Retrieved May 15, 2009, from http://www.usdoj.gov/adr/pdf/final_manual.pdf King Soopers. (2009). Your contract proposal [Brochure]. Denver, Colorado: Author. UFCW - Local 7 (n.d.). The history of labor. Retrieved May 12, 2009, from http://ufcw7.canvastoolbox.com/'page=laborhistory Vuong, A. (2008, May 29). Union muscle Veteran labor leaders representing 100,000 workers join forces to fight right-to-work ballot measure. The Denver Post, p. 7b. Yukl, G. (2006). . In Introduction: the nature of leadership (pp. 1-21). : Pearson Prentice Hall.