Deere, UAW differ on communication about ‘last, best’ contract offer

Are Deere & Co. and the UAW union at an impasse in labor negotiations? It depends on who you ask.

Deere said on Wednesday its latest contract offer — rejected by union members Tuesday — is the company's "last, best, and final offer."

Jen Hartmann, a spokesperson for Deere, said Wednesday the company was proud of the six-year contract offer, which would have boosted pay and benefits for about 10,000 UAW workers in five states.

The UAW rejected the deal, 55 percent to 45 percent, despite gaining majority support from some Quad-City locals. The contract was rejected by locals in Waterloo and Dubuque.

UAW officials said Deere did not inform them the contract was its final and best offer before alerting the media.

When asked about the notification of the final offer to the UAW, Hartmann said both sides made concessions and compromises during contract negotiations.

“In reaching the second tentative agreement with the union’s bargaining committee, we advised that the overall value of the compensation and benefits package were as far as we were willing to go,” she said.

An impasse?

Labor experts say an impasse is difficult to define because it depends on the parties involved.

“It's just as a point where both sides have given their best last and final best offer,” said Matt Pappas, an employment lawyer in Rock Island, Ill. “You know it when you see it.”

The National Labor Relations Board requires an employer and unions to negotiate “until they agree on a labor contract or reach a standoff or 'impasse.' ”

An impasse is defined as a total breakdown of the bargaining process that occurs after good faith negotiations and exhausted perspectives, according to the NLRB.

“The duty to bargain isn't terminated, though,” Pappas said. “It's only suspended.”

There is no formal process for determining or declaring an impasse, according to Paul Iversen with the University of Iowa’s Labor Center.

Both parties have to be unwilling to make any additional offers, but if one party creates a new proposal, the other party is obligated to hear it.

“If all they're doing at the table is trying to convince the UAW to submit this same proposal to another vote, you may be at an impasse while still being at the table,” Iversen said. “The issue is, is either side willing to change their position at the bargaining table?”

Hartmann confirmed that Deere and the UAW are still communicating.

“We are still in conversations with the UAW and remain receptive to any proposals the UAW might make will result in a ratified contract — but we have reached our maximum in terms of overall new costs,” Hartmann said.

‘Final offer’

Iversen and Pappas said the terminology used by Deere, “last, best, and final offer,” is a “term of art” in negotiations.

This term typically indicates that a company has reached an impasse, according to Iversen.

However, not all employers know the origin of the terminology and the full extent of what it means to use it, he said.

“Sometimes, employers will use the terminology 'this is our last, best, and final' offer as a precursor to arguing toward impasse if the union doesn't accept that offer,” Iversen said. “But those words aren’t magic. They don't create an impasse if one doesn't exist.”

Outcomes

If an impasse is reached, Deere can implement the new agreement and fill union member’s jobs with outside workers, according to Pappas.

“If negotiations reach an impasse, an employer can impose terms and conditions so long as it offered them to the union before impasse was reached,” according to the NLRB.

If Deere decides to implement the latest agreement, it would apply only to workers who are strikebreakers, according to Iversen.

If Deere unilaterally implements the latest tentative agreement, and the UAW doesn’t agree with the impasse, the union can file an unfair labor practice charge with the NLRB if they think violations have been made, according to Iversen.

“That's how the National Labor Relations Board ultimately decides whether they're at an impasse,” Iversen said. “If they decide, no, you're not at an impasse, you can't implement those terms. You have to go back to the table.”

Iversen said that if the UAW found out the proposed contract was Deere’s final offer through the media, it could potentially qualify as bad faith bargaining, depending on the circumstances.

Deere’s Hartmann said although Deere’s first priority is to get an agreement ratified, the company needs to start preparing for the future, and everything was on the table.

“I do believe we have to start thinking longer term if that doesn’t happen, looking at each unit and what their needs are,” she said.