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A Fresh Squeeze On Labor Negotiations
Tropicana Reshapes Its Labor-Management Relations through Involvement and a New Negotiation Model

"Like comparing apples to oranges." An old cliché, but for Tropicana, that cliché became a reality.

But instead of apples it was "management." And instead of oranges it was "union." If Tropicana couldn't find a common ground between these two there would be no oranges, and nobody liked those apples.

At the beginning of this decade Tropicana was plagued with labor-management relations issues that left the company in almost constant negotiations and arbitration. Labor and management at Tropicana consistently entered into negotiations that resulted in mistrust, poor relations and required immense arbitration.

About the Oranges
The Brandenton, Fla.-based Tropicana Products, Inc. is a division of PepsiCo, Inc and is the world's leading producer of branded fruit juices. Tropicana produces the popular brands Tropicana Pure Premium Original, Grovestead and Homestyle juices, Pure Tropics, Tropicana Season's Best and several Dole juice blends. The Brandenton plant, with over 1900 hourly employees, is one of Tropicana's largest producers of beverage products. The Teamsters Local 173 represents the majority of the 1900 hourly employees at the Brandenton plant.

Bitter Oranges
In the early 90s there were several labor-management negotiations that were characterized as hostile and adverse and they achieved less than satisfactory results. In 1992 a round of labor negotiations between Brandenton management and Local 173 left the company with depleted resources - the company was investing extensive man hours and money to these negotiations. Another round of contract talks in 1995 produced a work agreement that received a 93 percent rejection vote in its first round. This later round of contract bargaining was finally completed two months past the due date.

"In 1995 we had a ratification but no agreement on what the contract actually meant. We went two yeas without actually signing the contract," states Harry Litzell, director of HR at Tropicana. "We also had three pending arbitration as a result of that contract."
Management summarized these negotiations as a bad situation made worse by the fact that the company spent huge numbers on arbitration over the term of the contract trying to make the agreement stick.

Overall, the contract talks at Tropicana produced broad mistrust and there was no process in place to ensure that future negotiations would be improved.

It soon became clear to the company that there had to be a better way to address labor-management contract talks. Too much time, money and resources were being absorbed establishing work agreements. So, in 1996 the company reexamined its negotiation practices, redesigned its human resource function and appointed Litzell as the position of Operations HR Director to address labor relations.

A Ripening of Relations
At this point both labor and management were looking for a new process that would avert the recent history of hostile negotiations.

"We had a significant opportunity to do things better," Litzell adds.
The first step in establishing better relations began with HR meeting with union leaders to hear their input on improving management-labor negotiations. At this time both groups took steps to better understand the other. HR began working to recreate their understanding of the union leaders' role. And the union focused on day-to-day problem solving so as not to let grievances snowball into negotiation obstacles.

Then in late '96 a Labor-Management Committee (LMC) was established with a primary focus to change labor relations at Tropicana. The LMC consisted of the Union Executive Board and members of Operations and HR.

In the fall of '97 the LMC concluded that they needed outside guidance to facilitate their labor relation improvement efforts. The LMC jointly selected a labor management consultant, Odyssey Consulting Group, Syracuse, N.Y., to spearhead the improvement process. Then the bargaining committee attended a workshop on interest-based negotiations. After the workshop, neither party was committed to abandoning the traditional labor negotiation model, but everyone agreed that several principles of interest-based negotiation needed to be included in Tropicana's bargaining model.

A Citrus Hybrid
And so the LMC developed a hybrid model that combined aspects of the traditional model with interest-based tools. This new model was to be applied for the '98-99 negotiation.
"There were clear business reasons for trying an interest-based approach," Litzell states. "Battling each other - in the long run - does neither party any good. A work stoppage puts the entire business at risk. Our products have a 63-day shelf life. Shutting down would be out of the question. We'd be off the shelf."

In this hybrid model economics were held until the end of the bargaining process (a traditional approach), but subcommittees trained in interest-based negotiations were brought in to provide a fresh perspective. Many subcommittee members had not participated in past negotiations and they were from various company disciplines - pension, payroll, engineering, etc.

"We wanted to inject some new blood - people who had no idea what traditional bargaining looked like. We also wanted to bring in subject matter experts," states Theresa Flynn of the Odyssey Consulting Group. "We used this subcommittee model where the subcommittee data fed into a more traditional model," Flynn adds.

The subcommittees' focus was to develop a list of all possible solutions for each issue in the negation. The overall outcome from the subcommittees was to find solutions that would please both management and labor. These committee members were not considered to be from labor or management - they were instructed to work impartially and to present all ideas considered in their meeting to the main bargaining committee.

Then in may of '98 the subcommittees presented all of their ideas to the bargaining committee in an unbiased process by identifying the problem, possible solutions and whose interest each solution met. In June of that year the bargaining committee met at a series of off-site retreats with the goal of reaching an agreement.

Fresh Squeezed Results
So how did the new model work out? In August of '98 a collective bargaining agreement was reached, five months early. This contract was ratified by a majority of the Teamsters 173 membership. It was also the first time a five-year agreement was achieved in the bargaining history of these two groups.

"In addition we involved numerous union leaders, stewards, mangers, supervisors and subject matter experts in the process. We worked toward a common understanding of agreements to avoid future grievances and arbitration," states Bill Woolston, vice president of labor relations. "We truly bargained in good faith."

It was not a perfect process, but the new model worked better than any past attempt. With a lot of determination and participation, Tropicana and Teamsters 173 were able to blur the lines between what is an apple and what is an orange.