Reference no: EM132296769

You are the Human Resource Manager for FoodMart, a regional grocery retailer. The Foodmart employees are members for the Retail Clerks Union, and FoodMart and the union are engaged in negotiations to renew their collective agreement. The retailer grocery business is extremely competitive, and a number of low-cost, low-overhead chains compete directly with FoodMart. The employees of the low-cost grocery chains are not unionized, and their wages are barely above the minimum wage. FoodMart employees' wages average around $9.25 per hour, and FoodMart also offers generous benefit packages, including medical insurance and pensions. As a result, FoodMart's labor costs are much higher than the low-cost chains, and FoodMart has seen its profit margins decline. FoodMart had considered proposing wage and benefit reductions to the union; the union has publicly vowed not to agree with any wage concessions. To avoid a strike, the CEO suggests that you offer the union a guarantee not to reduce wage and benefits I'd the union agrees to begin a campaign of consumer and publicity picketing and hand-billing in front of the low-cost grocery stores-to inform the public how the low-cost chains treat their employees.

1. What arguments can you make in favor of such a proposal?

2. What arguments can you make again it?

3. Should you make such an offer to the union?

4. Prepare memo to the CEO outlining the positive and negative aspects of the proposal, and recommending a course of action, with appropriate supporting reasons.