A bargaining process, begun over 10 years ago, is based on problem-solving rather than on adversarial confrontation and uses elements of participative management. It has resulted in outstanding benefits for two school districts. Called "Theory Z bargaining," the process follows a procedure based on each side treating the other with respect. Bargaining may occur at any time to resolve a problem. Monthly meetings are held to discuss and solve many of the problems that occur in school districts. The history of the model with its benefits and difficulties for the two districts is traced. The appendixes contain a caveat to teacher association leaders and a letter from an out-of-state superintendent reporting favorable results from using the bargaining model. (MLF)