Chapter 34

I had done some thinking and made some calls. To make sure that the Union Representatives heard the message correctly, I asked Craig to fly in to show them how serious we considered the meeting. This only dealt with one port, but all ports have unions, so we expected that at this meeting, we'd be setting a precedent.

It was the beginning of 1983 when the minimum wage was $3.35 an hour or just under $7,000 annually. The median income was just under $21,000 a year. We were paying our drivers fifteen cents a mile, which was the equivalent of nine dollars an hour or $18,720 a year. This compensation was better than most of the drivers received before coming to us. What this salary did not consider was that many of their old bosses expected them to work many more than the forty hours a week that their job called for them to work, and that their bosses had not been paying them for the extra hours. With us, they only work forty hours per week and they were making more with us on an annual basis. In addition, because they were our employees, there was the life and health insurance we offer to them and their families, we provide better benefits, and they receive paid vacation time as well. We were in a good place, because we were a rather new company, and the comparison between the old ways of doing business and the new ways were fresh on our driver's minds.

Craig and I met with Senator Carlson for the first time on the morning of the meeting. He seemed like a nice guy, but was smart enough not to take sides. He had coffee brought in and we made small talk for a while. It turned out that the union guys who showed up for the meeting, were nothing like the stereotype I had pictured, and actually had two eyebrows. I had to laugh when I learned that their names were Tom and Jerry. They smiled, long since used to the humor their names provided.

They started the discussion first, since they called the meeting. Tom was the spokesman, and he said, "We represent the longshoreman's union for the port of Los Angeles. Our bylaws and contract states that we only allow union drivers on our site. Our biggest issue is that many of the union drivers have left their old jobs, and have gone to work for your company. It's very important that we get the freight moved, but can't have your drivers come on our site. Although we're trying to come up with a solution, so far we haven't been successful. We have even spoken about hiring a team of union drivers to drive the freight a mile to a drop off point where your drivers can pick it up."

I spoke next, "Tom, Jerry, both Craig and I appreciate what the unions have done for this country's work force, but as a company we have offered better pay, better benefits, better hours, and better equipment to our drivers without a union being in place or negotiating for the employees. If we had been smarter, we'd have brought in the union and negotiated a long-term contract that was better than before, but not nearly as good as, what we offer our employees now. We're safer, faster, and cheaper than the competition.

"However, history is just that, and we can't undo what's done. We'd like to propose a solution as follows: We'd like to have a six-month window to establish a union in our company for all non-management employees. To that end, we have already started the process, and have established a committee of drivers, mechanics, dispatchers, and warehouse workers, to put this in place. To support this effort, we'll encourage a favorable vote from all the employees and even consider a raise in salary to cover the union dues as part of the negotiations. As you already know, we're a large company with a wide geographical focus. Since most of our employees work alone as drivers, they don't have the opportunity to talk to the others daily. We work around the clock, so we have work times spread around the clock. This is why we're asking for six months to put this in place."

Tom said, "I'm happy to hear that, and I can understand your time request. These things don't come together over night. We still have the issues of our bylaws. I think the Teamsters Union might be upset if you form your own union"

"I've spoken with Craig. We're very committed to this, so to that issue, we propose that we pay a penalty of a dollar for every non-union driver that makes a pick-up in your port. After the six months were asking for, you can increase the fee. This shows a good faith effort on our part to encourage the union and get it established. If we don't succeed in six months then it could really hurt us financially. Our employees can go with the Teamsters if they want but they will make that decision. They may want more control and with the size of our company they don't need outside support."

"There is more than one union and we can't control which one your employees choose to join as long as they are union, they will meet our requirements. We may want to talk with them to make sure that it is a real union. About hauling from our port, what would the fine be after six months?"

"Fifty cents? I don't know. What do you think would be fair?"

"We send out a thousand trucks a day, so at the moment, the penalty is a thousand dollars a day. If we bump it to a hundred a driver, then we'd go to a hundred thousand a day. Our union can use the thousand and would love the hundred thousand, but our official statement will be more along the lines that we'd prefer to have a union in place yesterday."

"I'm not sure what we need to put in writing, but I think that if you can accept our proposal then we're happy to work on making it happen on our side," I said, as I held out my hand.

Craig had his hand out, and Tom and Jerry were quick to take our offer. What just happened baffled the senator. We agreed to have a new document drawn up by the end of the month, and over to them for their signatures.

After Tom and Jerry left, the senator said, "I thought I was going to watch a blood bath before this started. To accommodate that, I had all day blocked off. It took thirty minutes, and most of that was getting the coffee orders right."

"Senator, why don't you let Craig and I take you over to the club for some breakfast?"

He said that he'd heard of the new club, but hadn't had a chance to get by there. We walked over to the club and I introduced him to Gary, the manager. I did a quick tour for him and then accessed the private area. I explained that this is a private area, and is only for founding members and invited guests. If you need to talk, off the record, then this is a place where you can say what you mean or what you think, and not have it leave the doors.

I said, "We're not trying to invite a union into our company. We're trying to establish a new union within our company. Our employees are happy with their work and benefits, because of the way we operate. It has made their lives better. I was serious when I said that, if the drivers received half of the difference between the old and the new work environments, they would be thrilled. We can get something set up now to protect us from some disruptive union vote in the future."

He said, "I think that you have a good shot at making this happen the easy way. It may hurt you in the future if they get too demanding, but for the short-term, you made this real easy for everyone. The Longshoreman's Union Reps are happy to get the money, and can still save face with the guys they represent."

We ordered an early lunch and the senator liked the food. When I explained the purpose for the club, he understood it very well. I told him that although he may come in ten times he may only speak to a lobbyist once or twice, and even then, it may end up not being about business. Most of the time we stopped by, it was to develop relationships, not to lobby, but if we determined that there was something important that we needed to discuss, then we'd only take a moment to present our side of the argument. He signed up before he left, and thanked us for giving him four hours of his day back.

It took a couple of weeks to get a group of employees that represented the different regions, jobs, ages and of course, men and women that worked for us. I was happy to see Susan from down on the farm, representing both women and the sales force. We had thirty people assembled for the meeting. Craig and I had spent the last two weeks putting together an approach that we wanted to see as the structure of our business.

One of our first needs is to prevent any strike at any time. Second, we didn't want multiple unions. I saw how the airlines got stuck with the pilots in a different union than the flight attendants and the mechanics. It made it hard on the company because each union was trying to outdo the other. We didn't want years of service to decide anything. It's important that we pay the best people the most and that we can promote them the fastest.

When we brought the meeting to order, what surprised me was that none of the employees wanted a union. Five had come from union shops, and they didn't want anything to do with the union. After listening to all of them, I then spoke.

"Many of the ports and factories that we pick up from, and deliver to, require that we be a part of a union. I have some ideas about how we can structure the union so that we all benefit, but we also have some level of protection. This is my idea, but as a union, you will have to have a vote to see if you accept it, and of course we want your comments and ideas of what would be best for the employees."

Susan raised her arm and said, "I love my job and am thankful every day that I walk in the office. I think that the compensation is more than fair. I'd be happy to sign something that says we get what we already have."

"Thanks, Susan. I want to give you what you're worth, but also protect the company and the customers. If you think about it, if our business went on strike, we could literally shut down the trade in the United States. That's a scary thought to the government and citizens of the country. When people become scared, they try to pass laws to prevent it from happening, or they try to get rid of it. I'd like to have a clause in the contract that prohibits a strike. This is the most extreme action that the employees have in their arsenal when negotiating with management. I'd propose that if we sign a six-year contract that we'll renew after five years."