PD Editorial: The unknowns about new SEIU contract
Published: Friday, December 7, 2012 at 7:00 p.m.
Last Modified: Friday, December 7, 2012 at 5:09 p.m.
In the days before the Great Recession, the general public paid little heed to such things as renewal of labor contracts, primarily because they didn't have much of a chance to do so. The negotiations were done in private, the unions then voted and soon after the Board of Supervisors would ratify them. Only at that point did the public start to get an idea of what the contracts entailed and what they meant for the county's budget.
Unfortunately, the same process is taking place this time concerning a landmark labor contract for the Service Employees International Union, Local 1021, which covers roughly half of the county's 3,7000 workers.
But times have changed. Public interest is heightened given several years of budget deficits, soaring retirement liabilities and declining dollars being available for basic functions such as pothole repair. Public interest is also high given the supervisors' commitment to roll back retirement costs to 10 percent of payroll, where costs traditionally were before the era of “enhanced” benefits kicked in beginning locally around 2004.
Since then, the county's costs have more than tripled and now stand at around 20 percent of payroll or roughly $100 million. If no changes are made, costs are projected to grow nearly 30 percent, to roughly $209 million a year, within 10 years.
Given what's at stake, readers might have expected more transparency this time around. The public, once again, would have been in the dark almost entirely if it weren't for the fact that SEIU posted the proposed three-year contract on its website. That freed the county to do the same.
But the public still won't see a full analysis of the contract — what it will mean for the county's overall budget, etc. — until Tuesday, a day after the union concludes its vote. If the union approves, the board is expected to vote on Tuesday as well, leaving outsiders little time to analyze and offer their input.
It's unfortunate, because based on what we can see, there are reasons to be cautiously optimistic about this new contract — and reasons to be concerned.
On the positive side, the deal would ensure new and existing employees pick up more — 2.5 percent of their pay more — of their retirement costs. It also creates a new pension benefit formula for new employees, who will receive 2 percent of their salary for each year of service, retiring at age 62. Current workers earn 3 percent a year at 60. Movement on both of those numbers is key to righting the pension ship.
This kind of change is needed for budgetary reasons, but it's hardly something to applaud. This will be a hardship for many employees. Given that, it's gratifying to see the county is offering to give employees financial help through increased contributions to health spending accounts. Since 2008, the county's contributions toward health care have been capped at $500 a month, which, in this environment, doesn't go far.
But what's not clear is the math and how all of this adds up. It's unclear whether it even meets the supervisors' stated goal of reducing employee compensation costs by 3 percent through this contract. That kind of big-picture analysis will arrive later — after the union finalizes its tally and moments before supervisors vote. Given how much is riding on this, that seems needlessly hasty.
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