DEMOPOLIS – After rejecting three contract offers, union employees at Gulf States Paper Co. have taken another step to resolve a seven-month dispute with their employer.

On Tuesday, representatives for Gulf States and the Paper, Allied-Industrial, Chemical and Energy Workers Union began a mediation process in Demopolis.

Gulf States spokesman Dan Meissner could say little about the mediation process, but he did indicate the meetings are not abnormal.

“This is very common,” Meissner said.

Emory Barnette, who could not be reached immediately on Tuesday, has served as one of the top negotiators for PACE union members at Gulf States. Barnette, who worked at Gulf States for more than two decades, indicated earlier this year that union officials would continue working toward a common ground with Gulf States over the contract dispute.

On Jan. 7, 2004, a five-year contract between union employees and Gulf States expired. Employees voted Jan. 8 to reject the new contract offer from Gulf States because of changes in retirement opportunities with the company.

Company officials presented another proposed contract in February, which union employees, for a second time, rejected on Feb. 26.

The greatest dispute between employees and company officials is Gulf State’s decision to eliminate pension plans and replace them with expanded 401(k) options.

Members of management at the Demopolis plant have long since lost pensions in exchange for a 401(k) plan, but union employees have refused to accept the same compensation package.

The mediation that began Tuesday has no strict time frame for completion, according to Meissner.

“We’re doing this at the request of the union, and we’re happy to have some discussions with them,” he said.

Gulf States officials have maintained a firm stance in their decision to eliminate pensions for 401(k) options. Neither Meissner nor any other company official has publicly discussed the issues surrounding the dispute, but it has become public knowledge that employees – and more importantly, the PACE union – do not want to budge on the pension issue.

“You’re talking about people’s livelihood here,” Barnette said after the Feb. 26 vote. “They want to put employees on a savings plan.”

On May 13, union members voted for the third time on a new contract, and after that vote failed, Meissner said Gulf States had made its “best and final offer.” He did not indicate why Gulf States agreed to enter into mediation, but over the past seven months, Gulf States officials have consistently said they were willing to negotiate in good faith with union employees.

The mediation process that began Tuesday is being facilitated by the Federal Mediation and Conciliation Service – a group funded by the federal government.

FMCS handles thousands of mediations each year, and in the case of the Gulf States employee contract dispute, FMCS will simply serve to assist company and union officials in their discussion.

According to FMCS literature, the agency helps:

Set ground rules and realistic expectations for negotiations;

Decide what form of negotiation will work best;

Define the problem between the two parties;

Keep negotiations focused and efficient;

Improve communication;

Provide and share information between the parties;

Manage relations with the media.