1. #1
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    Default Worcester, MA: Wadda contract mess...

    This has been brewing for several weeks and these are the first "hard" numbers I've seen reported.

    Background is the Firefighter's contract gives them parity with Police Officers for pay and also has a "re-opener" clause. The Police officers also have parity with Firefighters...

    An arbitrator granted the Police Department a raise to give them parity with the Fire side...which has caused the Fire contract to automatically be re-opened to raise them back up to parity. Any way, read the article, it shows how "automatic" stuff allowed into a contract can really come back to haunt a later city administration.

    This isn't meant as a slam against the union either, the city signed the agreement. It's just often when you look at stuff like this or many other gov't expenditures, the politicians usually have a 2 to 4 year outlook on life (when is the next election?) so during years the budget is in good shape they can give away "goodies." The Unions (fire, police, teachers, whatever) often can take a longer-term view that the politicians come-and-go, we'll still be here when the "upside" to those small paragraphs kick in:

    Tuesday, August 17, 2004

    Decision would raise firefighters' base salaries 7%

    Nick Kotsopoulos
    TELEGRAM & GAZETTE STAFF
    nkotsopoulos@telegram.com

    WORCESTER- Base salaries for city firefighters would go up by roughly 7 percent under the arbitration decision recently awarded to their union, according to an analysis by City Auditor James A. DelSignore.

    He said the actual amount will vary for each firefighter because of differing hours of overtime worked and a complex salary schedule that includes stipends for exposure to hazardous material, years of service and educational degrees that increase with each pay raise.

    Because of that, the auditor said, calculating the individual raises for all firefighters will take several weeks. He said, however, the total cost of the arbitration award to the city will be $5 million.

    City Manager Michael V. O'Brien has recommended laying off 60 firefighters and raising $1.75 million more in property taxes to help fund the award. But the City Council is expected to resoundingly reject that recommendation tonight, sending the matter back to collective bargaining.

    Several city councilors have said they cannot support laying off firefighters or raising taxes to fund the salary increases.

    In preparation for tonight's meeting, several city councilors requested information from the auditor on the cost of the arbitration award.

    The award requires the city to pay retroactive amounts for fiscal 2002, 2003 and 2004. It also requires a retroactive payment for part of this fiscal year and prospective payments for the balance of this year.

    Using an example from the firefighter contract -- a firefighter with an associate's degree and 5 to 10 years of service; and assuming payment for 11 holidays and $2,500 annually for overtime -- Mr. DelSignore said that person would receive $7,327 in retroactive payments through June 30 under the arbitration award.

    He said that translates into an increase in that firefighter's current base salary of 7.08 percent.

    "It's hard to come out with an exact figure that would apply to all firefighters because several different factors apply to each one, especially in terms of stipends and longevity," Mr. DelSignore said. "I based my analysis on the example that was used in the firefighters' contract."

    According to salary figures compiled by the auditor, roughly 340 of the 434 employees in the Fire Department earned $60,000 or more in 2003.

    Mr. DelSignore said the arbitration decision would restructure salary ranges for the Fire Department. He projected that the new minimum base salary for a firefighter would be $52,000, with the maximum at $67,100. The current minimum is $48,600 and the maximum is $62,700.

    The new base salary ranges for other positions would be: lieutenant, $67,200 to $75,350; captain, $74,900 to $83,200; and district chief, $86,000 to $92,000.

    The deputy chiefs and the fire chief are not members of the firefighters' union.

    Last month, the Joint Labor Management Committee Arbitration Panel issued an award in a case brought by Local 1009, International Association of Fire Fighters, against the city. Local 1009 contended the city was required under its contract to reopen negotiations with the union because of a January 2002 arbitration award in favor of the local police unions. That decision, which was intended to give police pay parity with the firefighters, gave the police a 3 percent raise.

    The Joint Labor Management Committee panel decided the city was bound under contract to reopen negotiations and awarded a 3 percent increase in base wages effective June 30, 2003, and an increase in the base wage as follows: June 30, 2001, $250; July 1, 2001, $250 and July 1, 2002, $750.

    Mr. DelSignore said the 3 percent salary increase that was awarded at the end of fiscal 2003 automatically triggers another increase of about 1.1 percent because of the way the stipend for exposure to hazardous materials -- known as hazmat -- is structured in the firefighters' contract.

    "Additionally, longevity and educational stipends are calculated as a percent of salary and therefore with every pay raise, the amount of these stipends also increase," Mr. DelSignore said. "Using the example in the firefighter contract, the retroactive amounts added to the base in fiscal 2002 and 2003, combined with the 3 percent increase at June 30, 2003, and the 1.1 percent hazmat increase would result in an increase in base salary as of July 1, 2003, of 7.08 percent.

    Mr. DelSignore added that firefighters who retired during the period of the award would also be given increases in their pensions. That, in turn, would increase the city's unfunded pension liability because pensions are calculated as a percentage of salary.

    "The pension system would experience an actuarial loss because prior estimates for total salaries would now be underestimated," he said.

    The auditor said he intends to provide the City Council additional information tonight, showing what base salaries are for firefighters in Springfield, Providence and Boston, as well as the number of firefighters in each city.
    Last edited by Dalmatian90; 08-17-2004 at 11:45 AM.
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    The award is so large because the city chose not to honor the contract language in 2002 when it should have. Instead rolling the dice with an arbitrator and creating an unfunded liability.
    What alternative did the union except to compel compliance with the contract. Negotiating some flexibilty in the way the award is paid out could earn the local a bounty of public good will.
    Way to go Worcester

  3. #3
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    unfunded liability.

    Don't ya love those?

    My town has one that's $80,000 currently and growing at $40k/year.

    May not sound like much, but my department gets $65k a year in tax money for operations to put in perspective.

    No matter what the cause that the original estimates were off, it's an obligation the Town took on and an issue that the Town has to resolve.
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