The State Worker: Stalled union talks a beginning, not the end

07/02/2014 11:00 PM

07/03/2014 1:27 PM

Three state employee unions end this holiday week without new contracts. Lawyers, building equipment operators and scientists won’t receive the modest raise that kicked in Tuesday for just about everyone else in state government.

It’s easy to consider the unions that represent them as labor-contract laggards, but look ahead. The lasts could become firsts.

The three unions remain at odds with Gov. Jerry Brown over pay. Every other union has a current agreement with the administration. Most are variations of the contract bargained with SEIU Local 1000 in 2013 that provides raises of up to 4.5 percent split between this year and next.

The holdouts want far more. Their members’ salaries lag their industries so badly, they say, that it hampers recruiting and retention. A mediator has been called in for talks with the 850-employee building operators union, which last month rejected an SEIU-type deal and authorized a strike. The scientists’ 3,000 members rejected a contract offer last week. And the attorneys union hasn’t even presented an offer its 3,400 members.

The cabooses could end up pulling the train, however. Most union contracts, including that of the 95,000-member Local 1000, expire next July. So if the three holdouts get deals in place before that, their contracts could influence subsequent negotiations, especially if they agree to something the administration wants.

In 2010, the Highway Patrol officers union and three other groups coordinated deals with then-Gov. Arnold Schwarzenegger, agreeing to increase employee pension contributions and cut benefits for new hires. The unions also received a no-furlough promise and a deferred raise for members at the top of scale.

The agreements gave Republican Schwarzenegger the pension win he craved and set terms for other unions. All bargained contracts with similar provisions.

What does Brown crave? Well, he wants to shrink the state’s estimated $64.6 billion long-term liability for retiree health care. Unlike state pensions, which invest contributions and pay benefits from returns, California sets nothing aside for retiree medical costs. The “pay-as-you-go” policy covers bills as they come due. It’s the most costly way to do business.

Say the unions kick in a few bucks to prefund retiree medical benefits for a significant pay hike. Or maybe it’s another issue. Regardless, Brown could satisfy that craving and send a message to other unions ahead of next year’s negotiations.

“There’s a burning need for reforms in state government,” said former state human resources chief Dave Gilb. “I’d come to negotiations with a list.”

The unions could refuse. They could argue that, unlike the Schwarzenegger years, the state budget is in the black, that their members have given up plenty already with years of deeply discounted wages. It’s payday time.

And what if they can’t reach a deal? More about that next week.

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