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Title: Manor Management Services and Service Employees International Union, Local 49
Date: July 6, 2000
Arbitrator: Burton White
Citation: 2000 NAC 140

IN THE MATTER OF THE ARBITRATION

between

Service Employees International Union,
Local 49, AFL-CIO-CLC

Union

and

Manor Management Services
D.B.A. Ya Po Ah Terrace

Employer

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)               Opinion and

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Before Burton White, Arbitrator  
 

 

Date of Hearing:   June 21, 2000

Place of Hearing:  Eugene, Oregon

Advocate for the Union: Christine Hauck
Field Organizer
3536 S.E. 26th Avenue
Portland, Oregon 97202-2901

Advocate for the Employer:                Patrick C. O’Toole
President
Manor Management Services, Inc.
1625 S. E. Lafayette Street
Portland, Oregon 97202

 

Issue

Background

Relevant Language

Position of the Parties

Position of the Union

Position of the Employer

Discussion

A Preliminary Matter

Analysis

Conclusion

Award


        The parties to this dispute are the Service Employees International Union, Local 49, AFL-CIO-CLC (Union) and the Manor Management Services D.B.A. Ya Po Ah Terrace  (Employer).

        The arbitration was held pursuant to the provisions of the collective bargaining agreement between the parties effective July 1, 1999, through June 30, 2002 (New Agreement) (Jt. Ex. 1).

The hearing was held on June 21, 2000, in Eugene, Oregon.[1]  The parties stipulated that the matter was properly before me as Arbitrator to issue a final and binding decision. Both parties participated in the hearing; each had full opportunity to present evidence, call and cross-examine witnesses and argue its case. Both parties made oral closing arguments at the end of the hearing whereupon the record was closed.

ISSUE

        The parties authorized me to determine the answers to the following questions:

Did the Employer violate Article 19.8 of the collective bargaining agreement when it reduced the Grievant’s base rate of pay post negotiations?[2] If so, what should the remedy be?

BACKGROUND

        Except for one immaterial detail (see footnote 4 ), there is no dispute about the facts of this case. The relevant history began during the term of the 1996-1999 collective bargaining agreement (Jt. Ex. 2) when the Grievant became a Maintenance Painter.[3] The Employer compensated him at eighty percent of the Maintenance Painter hourly rate, citing Section 18.8 of the then current agreement. The Union addressed the matter with the Employer contending that the reduced rate of pay allowed under the language of Section 18.8 applied to new hires only. While the Grievant was new to a classification, he was not a new hire. The Employer was persuaded. The Grievant’s rate of pay was corrected and the parties agreed upon a back pay remedy.

        During the discussion, the Union pointed out that a reduced rate of pay for incumbent employees who entered a classification that was new to them could be addressed when the collective bargaining agreement was opened for re-negotiation. The Employer did just that. In the 1999 bargaining for the 1999-2002 Agreement, the parties agreed to modify the reduced pay provision so that it read, “New hire and classification shift starting rates shall be as follows.…” They also added the sentence, “New hire rates plus classification shifts will start/restart the new hire percentages for that employee.” (Jt. Ex. 1, §19.8.)

        The 1999 negotiations addressed other matters that are relevant to the current dispute. The parties agreed that the Maintenance Painter classification would be eliminated and that its work would be added to that of the Maintenance Mechanic. They also agreed that the Grievant would be moved to the Maintenance Mechanic classification and that the Employer would pay tuition and “lost time” costs for him to attend the Building Operator’s Course training that would qualify him for that work.[4]

        Final settlement occurred on December 8, 1999. While most of the New Agreement was made retroactive to July 1, 1999 (Section 21.1), the wage rates were to become effective January 1, 2000 (Section 19.1). At hearing, the parties stipulated that the Grievant received the Maintenance Painter pay of $14.97 an hour through 1999 and that the Maintenance Painter classification was eliminated in January 2000.

        The first paycheck issued to the Grievant under the new rate compensated him under the terms of Section 19.8. That is, he was paid eighty percent of the Maintenance Mechanic rate, whereupon the Union filed the grievance addressed in this arbitration.

RELEVANT LANGUAGE

Language of the 1996-1999 Collective Bargaining Agreement

ARTICLE XVIII – WAGES, CLASSIFICATION AND SENIORITY

Section 18.1   Effective 7/1/96, the following minimum scale wages shall be established, to wit:

 

7/1/96 RATE

Classification:

 

Maintenance Painter

$14.72

Maintenance Mechanic

13.37

Custodian

8.91

General Helper

6.43

***

    Section 18.8            New Hire rates are as follows:

Starting rate

80% of top rate

After 12 months

90% of top rate

After 24 months

100% of top rate

     To be cumulated on regular Employer pay cycles or hours equivalent thereof.

Language of the Current Collective Bargaining Agreement[5]

ARTICLE 19 – WAGES, CLASSIFICATION AND SENIORITY

Section 19.1       Effective 1/1/00, the following minimum scale wages shall be established, to wit:

 

Classification:

Rate

1/1/00

Rate

7/1/00

Rate

7/1/01

Maintenance Mechanic

14.72

[not applicable]

[not applicable]

Custodian

9.75

[not applicable]

[not applicable]

General Helper

8.00

[not applicable]

[not applicable]

    ***

    Section 19.8       New Hire and classification shift starting rates are as follows:

Starting rate

80% of top rate

After 12 months

90% of top rate

After 24 months

100% of top rate

      New hire rates plus classification shifts will start/restart the new hire percentages for that employee.

To be cumulated on regular Employer pay cycles or hours equivalent thereof.

ARTICLE 21 – TERM OF AGREEMENT

Section 21.1: the agreement shall be in full force and effect for the period from July 1, 1999 to June 30, 2002…;

POSITIONS OF THE PARTIES

Position of the Union

        The Union notes that the Employer proposed that the language allowing a lower starting rate of pay be modified in the New Agreement but never indicated that this change would affect the Grievant. It argues that if the Employer intended to apply the revision to the Grievant, it had the obligation to assert that intent during the bargaining. It did not.

        During the 1999 negotiations, the Union agreed to the Employer’s proposal to delete the classification occupied by the Grievant. The parties also agreed to have the Grievant move into the Maintenance Mechanic classification. They agreed that the Grievant had to take and pass the Building Operators’ Course and that the Employer would pay the tuition and cover the Grievant’s lost time. Those were the only conditions. There was no indication at all that the Grievant would be paid eighty percent of the Maintenance Mechanic rate.

The Union also notes that it made clear during bargaining that it would not participate in concession bargaining. It argues that any agreement that would allow the Employer to reduce the Grievant’s hourly rate after bargaining would have been a concession.

The Union asks that the Grievant be made whole and that he receive the appropriate back pay adjustment for the period from January 2000 until the Grievant’s final day of work on April 12, 2000.

Position of the Employer

The Employer argues that the history leading to the changes in language helps to make the dispute clear. When the Employer attempted under the 1996-1999 agreement to apply a reduced rate of pay to the Grievant at the time he began a new classification, the Union pointed out that the existing language governing a ‘”beginner’s” wage applied to new hires only. The Union recommended that the Employer address the matter at re-negotiation time.

The Employer took the Union’s advice. It addressed the matter when the agreement was re-opened. It obtained language in the New Agreement to the effect that the reduced hourly rate would also apply to an incumbent employee who moved into a classification that was new to that person. During that same bargaining, the parties also agreed to eliminate the Grievant’s classification, to incorporate the Painter’s duties into the Maintenance Mechanic classification and to move the Grievant into that classification.

On January 1, 2000—the agreed upon effective date of the renegotiated pay rates—the Employer implemented the modifications. By starting a classification that was new to him, the Grievant came under the terms of Section 19.8 of the collective bargaining agreement, a provision that had been placed into the New Agreement to cover just such a circumstance.

DISCUSSION

A Preliminary Matter

In its presentation, the Union established without contradiction that it had made clear to the Employer during bargaining for the 1999-2002 Agreement that it would not participate in concession bargaining. I report to the parties that I gave this fact no weight in my decision. This Union assertion can only be considered to be a unilateral declaration of a bargaining goal. Absent any action to transform this desire into a bilateral decision—such as making it part of agreed-upon ground rules—the assertion has no more significance than any other bargaining hope.

Moreover, notwithstanding its declaration, the Union did, in fact, engage in concession bargaining. [6]  It agreed both to deletion of the highest paid classification in the bargaining unit and to the incorporation of its duties into one receiving less pay. 

Analysis

In their presentations at arbitration, both parties cited four mutual decisions made during the 1999 bargaining as significant to resolution of this dispute: modification of the provision governing entry pay rate(s), deletion of the Maintenance Painter classification, incorporation of the Painter’s duties into the Maintenance Mechanic classification and movement of the Grievant from the Maintenance Painter to the Maintenance Mechanic classification. While all four decisions provide relevant background, only one—the change in language regarding entry pay rates—governs the dispute.

The Issue presented to me by the parties asks, “Did the Employer violate Article 19.8 of the collective bargaining agreement when it reduced the Grievant’s base rate of pay post negotiations?” The Grievant’s rate of pay was reduced by two factors. He was moved into a classification commanding lower pay and he was paid eighty-percent of that lower rate. Since the question put to me relates specifically to Section 19.8, my responsibility is to determine whether the discounted rate was proper.

        The first factor is not disputed. It resulted from the negotiated decisions to eliminate the Maintenance Painter category and to move the work (and ultimately the Grievant) into the Maintenance Mechanic classification. The Grievant’s hourly rate of pay (as Maintenance Painter) had been $14.97. The highest rate of pay under the New Agreement became $14.72.[7]  In short, the most that the Grievant as Maintenance Mechanic could have received under the New Agreement would have been $14.72 an hour, that is, twenty-five cents an hour less than what he had been earning as a Maintenance Painter.

The second reduction was imposed by the Employer pursuant to its interpretation of the modified provision governing reduced rates of pay for certain employees. The Grievant was paid eighty percent (80%) of $14.72. It is this reduction that the Union protests.

Section 18.8 in the old agreement had read, “New Hire rates are as follows:.…” The provision  was revised and renumbered. It has become Section 19.8 in the New Agreement and now reads, “New Hire and classification shift starting rates are as follows: ….” In addition, a sentence was added: “New hire rates plus classification shifts will start/restart the new hire percentages for that employee.”

Both parties agree that this modification of language came from a management proposal. Both parties agree that the new language applied to the movement of an incumbent employee into a classification that is new to that person. They agree that the revision would allow the Employer—for a time—to pay that employee a reduced rate of pay for work in the “new” classification. In short, the revision was intended to apply to the very situation that had occurred under the old agreement when the Grievant—an incumbent employee— shifted classifications and became a Maintenance Painter.

        The Union position is that to enable the modified language to apply to the Grievant, the Employer was obligated to assert such an intention at the bargaining table. I cannot agree.

The Union appears to have in mind the view that it is the “intent manifested by the parties during negotiations, rather than any undisclosed intent, [that] is considered by arbitrators to be most important.” However, that concept applies when the language “does not clearly express the meaning intended … [by the proposing] party and if the other party is thus reasonably misled as to the first party’s intentions….”[8]   In this dispute the intended meaning was clear. The Union was not misled. Under these circumstances, the responsibility lay not with the Employer to state its intention, but with the Union to assess the impact of the proposal before accepting it as part of the New Agreement.

The Employer negotiator testified without contradiction that during bargaining for the New Agreement, the parties neither discussed nor agreed to an exemption for the Grievant from Section 19.8; that is, the Grievant was not exempted from the language governing “beginner’s” pay.

The record indicates that modification of language, merging of classifications and rates of pay were separate proposals. Of course, as is often the case, one bargaining decision can impact another, but when that happens, it is the responsibility of each party to look after its own interests.

While the wage increases did not take place until January 1, 2000 (New Agreement, Section 19.1), other changes became effective as of July 1, 1999 (New Agreement, Section 21.1) Thus, the revised Section 19.8 was in effect when—in Janaury 2000—the Grievant shifted from the Maintenance Painter to the Maintenance Mechanic classification; that is, from his old classification to one that was new to him.

Conclusion

For the above reasons, I conclude that the Employer did not violate the collective bargaining agreement when it applied the terms of Section 19.8 to the Grievant’s rate of pay.

AWARD

In accordance with the evidence presented and the reasoning, considerations, and conclusions presented in the foregoing discussion, I find that the Employer did not violate Article 19.8 of the collective bargaining agreement when it reduced the Grievant’s base rate of pay post negotiations. The grievance is denied.

Respectfully submitted on this the 6th day of July 2000, by

 

Burton White
Arbitrator

 



[1] I tape-recorded the hearing as a supplement to my handwritten notes.

[2] The first question in the statement of the Issue might have more clearly reflected the cases argued by the parties had it read, “Did the Employer violate what had been negotiated in 1999 when it applied Article 19.8 to reduce the Grievant’s base rate of pay post negotiations?” Since I arrive at the same conclusion under either phrasing, I have elected to discuss the case argued by the parties rather than simply to rule that Article 19.8 allowed the management action.

[3] The Maintenance Painter was the highest paid of the four classifications within the bargaining unit. In descending order of pay, the other classifications were Maintenance Mechanic, Custodian and General Helper.

[4] The staff negotiator for the Union testified that she understood that further discussions would occur if the Grievant did not complete and pass the required training. The Employer’s negotiator testified that he understood that if the course was not taken and passed, employment would cease since the employee would not be qualified to do the work. The difference is not material to the dispute before me. In any case, the Grievant enrolled for the course but before he could undertake the training, the Employer found it necessary to lay off one of the two Maintenance Mechanics. The Grievant was the junior employee and elected to terminate his employment rather than to bump into another classification.

[5] Underlining and bold face are reproduced as found in the Exhibit.

[6] Robert’s Dictionary of Industrial Relations provides the following definition:

Concession bargaining   Collective bargaining in which unions agree to modify or forego improvements in pay, benefits, or working conditions in return for job security or other employment protection. Concession bargaining may also involve employee “give backs” in which employees agree to cuts in wages and/or other benefits. *** This is in marked contrast to traditional bargaining in which companies agree to increase wages and benefits to preserve management rights.

Harold S. Roberts, Robert’s Dictionary of Industrial Relations, 3rd ed., Washington, D.C., The Bureau of National Affairs, 1986.

[7] In bargaining for the New Agreement, Management proposed that the hourly rate of pay for Maintenance Mechanic move from $14.01 to $14.97 (Jt. Ex. 4). The Union bargaining team countered with the suggestion that $.25 of that amount be applied to increase the Custodian’s hourly rate to $9.75. The parties adopted the Union proposal. (In addition to the staff negotiator, a Business Representative from the Local, the Union team consisted of the Grievant and the Maintenance Mechanic, the two individuals who would be adversely affected by the redistribution.)

The $14.97 proposed by the Employer would have made the new rate for Mechanic identical to the old rate for Painter. The record does not indicate whether the Employer proposed this to “ease” agreement on its proposal to eliminate the Painter classification. If a correspondence was intended, the connection was lost when the parties settled on the rate proposed by the Union.

[8] Marlin M. Volz and Edward P. Goggin, Co-Editors, Elkouri and Elkouri: How Arbitration Works, 5th ed., Washington, D.C., The Bureau of National Affairs (1997) p. 504.


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