RED RIBBON CHICKEN
“Ivan Pittman and Deanne Gagnon are sitting in the boardroom of Red Ribbon Chicken Inc. discussing the strategic plan for the next three years. Ivan, CEO of the firm, and Deanne, VP of Human Resources, have certainly had their work cut out for them over the past few years.
About six years ago, the firm, then called Provincial Chicken Products Inc., was part of the provincial government. In its governmental role, it was the main chicken processor for the province and operated in a regulated industry with considerable protection. Then the government sold the operation to a private company. The sale resulted in the totally unionized hourly work force of about three hundred people no longer being covered by the provincial government’s collective agreement. Hence, a new collective agreement was signed. Three years later, the firm went into receivership at a time when Deanne and Ivan were negotiating a new collective agreement. Needless to say, funds were tight. Since the company’s creditors required that a collective agreement be signed and that the labour costs for the next five years be specified before they would agree to finance-structuring plans, the union and management realized that they needed to reach a settlement. The union encouraged the workers to accept the deal, even though wage increases were low, in order to save the company and their jobs. The resulting collective agreement provided wage increases of 0 percent, 1 percent, 2 percent, 2.5 percent and 3.5 percent over the five years. Similarly, the thirty or so non-union staff (mostly office staff, supervisors and managers) agreed to the same wage terms. The signed restructuring plan resulted in the formation of a new firm called Red Ribbon Chicken Inc.
Three years after the collective agreement was signed, and the restructuring plan was approved, the operation has seen many