-) Suppose that market demand for a good is Q = 480 – 2p. The

Rain Lake has a population of 20,000. The municipality has a public works department with five full-time employees; additional seasonal employees are hired when required. Three of the employees, including John Mills, are equipment operators who do road-grading work in the summer and snow removal in the winter months. The Township has employed John Mills for eight years. The other two equipment operators have 10 and 3 years of experience. Mills has no disciplinary record; however, he is the only equipment operator with two accidents noted in his file. Neither of these accidents involved traffic charges. The council for the municipality meets every January to determine the wages of employees for the year. Mills and the other two equipment operators met with the council in January, requesting a guarantee of 130 hours per month in the January–March period. The employees did not request a wage increase. Council agreed to increase the guaranteed hours to 115 per month. The three employees were very disappointed with council’s decision, and they approached a union about the possibility of organizing. A meeting with a union representative was held at the home of John Mills a few days later, and all five full-time employees were present. The union representative outlined the advantages of unionization and presented membership cards for signature. Mills and two others in favour of joining the union signed membership cards; one staff member was opposed; and the other employee remained undecided. When the employees’ supervisor heard about the meeting, he convened a meeting of employees at his home. He suggested that the employees allow him to approach council members before they proceeded with unionization. The supervisor spoke to several members of council and advised them that the employees were likely going to join the union. Arrangements were made for the supervisor to attend the next council meeting in February to address the issue of working conditions for employees. At the February meeting, the supervisor proposed that the Township agree to the guaranteed hours requested by the employees and provide a one-dollar-per-hour wage increase and an improvement in benefits. After the supervisor left the meeting, the council agreed to change the hours guaranteed; however, no further changes were made. At the same council meeting, a resolution was passed to eliminate one of the equipment operator positions. Council directed that John Mills be the operator terminated. When the supervisor asked why council had done this, he was told there were several reasons. The Township was facing a deficit, and costs would have to be cut to avoid a tax increase. Councillors also noted that the municipality had purchased a new, more efficient snow plough two years ago. Mills had been chosen for termination because of his accident record. Finally, council did not agree to the wage increase because they thought they knew the views of operators other than Mills on unionization. They believed the others would not join a union, and that the threat to join was a bluff. The town clerk said that prior to the February meeting she had checked with the provincial Ministry of Labour and confirmed that there was no requirement that employees be laid off in order of seniority. Questions Rain Lake has a population of 20,000. The municipality has a public works department with five full-time employees; additional seasonal employees are hired when required. Three of the employees, including John Mills, are equipment operators who do road-grading work in the summer and snow removal in the winter months. The Township has employed John Mills for eight years. The other two equipment operators have 10 and 3 years of experience. Mills has no disciplinary record; however, he is the only equipment operator with two accidents noted in his file. Neither of these accidents involved traffic charges. The council for the municipality meets every January to determine the wages of employees for the year. Mills and the other two equipment operators met with council in January, requesting a guarantee of 130 hours per month in the January–March period. The employees did not request a wage increase. Council agreed to increase the guaranteed hours to 115 per month. The three employees were very disappointed with council’s decision, and they approached a union about the possibility of organizing. A meeting with a union representative was held at the home of John Mills a few days later, and all five full-time employees were present. The union representative outlined the advantages of unionization and presented membership cards for signature. Mills and two others in favour of joining the union signed membership cards; one staff member was opposed; and the other employee remained undecided. When the employees’ supervisor heard about the meeting, he convened a meeting of employees at his home. He suggested that the employees allow him to approach council members before they proceeded with unionization. The supervisor spoke to several members of council and advised them that the employees were likely going to join the union. Arrangements were made for the supervisor to attend the next council meeting in February to address the issue of working conditions for employees. At the February meeting, the supervisor proposed that the Township agree to the guaranteed hours requested by the employees and provide a one-dollar-per-hour wage increase and an improvement in benefits. After the supervisor left the meeting, the council agreed to change the hours guaranteed; however, no further changes were made. At the same council meeting, a resolution was passed to eliminate one of the equipment operator positions. The council directed that John Mills be the operator terminated. When the supervisor asked why the council had done this, he was told there were several reasons. The Township was facing a deficit, and costs would have to be cut to avoid a tax increase. Councillors also noted that the municipality had purchased a new, more efficient snow plough two years ago. Mills had been chosen for termination because of his accident record. Finally, the council did not agree to the wage increase because they thought they knew the views of operators other than Mills on unionization. They believed the others would not join a union, and that the threat to join was a bluff. The town clerk said that prior to the February meeting she had checked with the provincial Ministry of Labour and confirmed that there was no requirement that employees be laid off in order of seniority.