County Board Briefed on Labor Issues

Washtenaw County board of commissioners working session (Feb. 17, 2011): County commissioners got an update last week on the county’s labor issues, as the county prepares for union contract negotiations later this year.

The briefing was delivered by Diane Heidt, the county’s human resources and labor relations director. She told the board that they’d be discussing specific negotiation strategies at their March 3 working session – those talks will be held in a closed session, however. Heidt’s presentation last Thursday was meant to set the stage for commissioners, and to answer any general questions they had as the county prepares to negotiate with its 17 bargaining units.

Leaders of two unions attended Thursday’s working session, though they did not address the board during the meeting: Caryette Fenner, president of AFSCME Local 2733, the county government’s largest union, which represents 621 workers within its five units; and Nancy Heine, president of AFSCME Local 3052, with 56 members.

The county faces a two-year, $20.9 million deficit for its 2012 and 2013 budget years. In a “State of the County” report given to the board earlier this year, county administrator Verna McDaniel targeted $8.5 million in cuts to employee compensation and benefits as part of their strategy for tackling the projected shortfall.

Washtenaw County Labor Overview

Heidt began by giving some context regarding the laws that govern collective bargaining. Congress passed the first federal labor relations act in 1935, to protect interstate commerce from being disrupted by labor disputes or work stoppages, Heidt said. The same goals drove Michigan’s state laws that regulate labor unions for public sector employees, she said.

The specific state laws that govern collective bargaining are:

• Labor Relations and Mediation Act (Act 176 of 1939): Grants full collective bargaining rights to private sector employees. It also provides for settling representation disputes, the hearing of unfair labor practice charges, and the mediation of contract disputes and grievances. Act 176 set up the three-person Michigan Employment Relations Commission (MERC) to administer these provisions, and to oversee the public bargaining laws.
• Public Employment Relations Act (PERA) (Act 336 of 1947): Provides for the recognition of an exclusive bargaining agent for public employees in appropriate units, and prohibits certain acts as unfair labor practices. It also prohibits strikes in the public sector. However, state employees are specifically excluded from PERA.
• Compulsory Arbitration of Labor Disputes in Police and Fire Departments (Act 312 of 1969): Provides for the compulsory arbitration of labor contract disputes between public safety employees of police and fire departments who are otherwise covered by PERA. While the MERC administers Act 312, the arbitration is carried out by private neutral arbitrators according to a MERC-sponsored selection process. Following a hearing before the arbitrator of all issues in dispute, the neutral arbitrator must make a decision, giving attention to a list of established criteria. The arbitrator is required to settle economic issues by selecting the last offer of either party which best meets the established criteria.

Heidt then explained that state law requires public entities to include certain mandatory topics as part of its collective bargaining contract negotiations. They include: (1) wages – hourly rates, shift premiums, vacation pay, time spent on union business, and fringe benefits; (2) hours – actual time worked, time spent on breaks, and overtime; and (3) working conditions – promotions, seniority, layoffs, shift preferences. “Those are the overarching areas,” she said.

Two of the county’s 17 bargaining units are covered by Act 312: The Police Officers Association of Michigan (POAM), with 251 members; and the Command Officers Association of Michigan (COAM), with 32 members. The other 15 units are covered by a process known as “bargaining in good faith,” Heidt said – arriving at an agreement through a give-and-take process of proposals. If no agreement is reached, there’s a process that provides for mediation, fact-finding and ultimate resolution.

One of the most crucial parts of a labor agreement lays out the grievance process, Heidt said – “that’s the piece that helps us resolve labor disputes.” It shouldn’t be viewed as a negative, she said. Contracts are relatively short documents – 50 pages or so, with about 75 articles – and there’s no way they can address every issue that might arise during the three- to five-year period of the contracts. That’s why having a clear grievance process is important, she said.

The state, through MERC, provides guidelines that govern where particular positions fit within the bargaining units. For example, you wouldn’t have nurses and sheriff’s deputies in the same bargaining unit – their roles are too dissimilar.

Labor Overview: Bargaining Units, Non-Union Employees

Heidt then outlined the 17 different bargaining units that represent the county’s 1,044 union employees. She noted that by law, employees and their supervisors can’t be part of the same bargaining unit.

• AFSCME Local 2733 (American Federation of State, County and Municipal Employees): 621 total members. There are five bargaining units within Local 2733: (1) Unit A (340 members) includes all general county professional employees who have a four-year college degree or higher, excluding supervisors; (2) Unit B (176 members) includes general county employees whose job requires less than a four-year degree, excluding supervisors; (3) Unit C (53 members) includes all employees of the 22nd District Court and Friend of the Court program, excluding supervisors; (4) the Family Division/Juvenile Center (29 members) includes all employees of the Washtenaw County Trial Court’s Family Division/Juvenile Center, excluding supervisors; and (5) Juvenile Detention (23 members) includes all employees of the county juvenile detention facility, excluding supervisors.
• AFSCME Local 3052: 56 members. Includes two units: (1) for general supervisors, excluding executive and administrative employees, and (2) supervisors at the Family Division/Juvenile Center, excluding executive and administrative employees.
• Michigan Nurses Association: 14 total members. Includes two units: (1) Unit I (12 members) for public health nurses; and (2) Unit II (2 members) for public health nurse supervisors.
• TPOAM (Technical, Professional and Officeworkers Association of Michigan): 33 total members. Includes two units: 1) Unit I (24 members) includes all senior deputy district court clerks, deputy district court clerks and probation secretaries at the 14-A District Court; and 2) Unit II (9 members) includes supervisors and probation officers at the 14-A District Court, excluding magistrates and the deputy court administrator. Heidt explained that until last year, these employees had been represented by the Teamsters, but they had voted to de-certify and become certified as part of the TPOAM union instead.
• Assistant Prosecutors Association: 24 members. There are two bargaining units covering assistant prosecuting attorneys, excluding the chief assistant PA and the deputy chief assistant PA.
• Public Defenders Association: 13 members. There are two bargaining units covering assistant public defenders, excluding the chief assistant public defender.
• Police Officers Association of Michigan (POAM): 251 members. Includes all general staff of the sheriff’s office, including deputies, corrections officers, communication dispatchers and support staff.
• Command Officers Association of Michigan (COAM): 32 members. Includes all supervisory staff of the sheriff’s office, including sergeants and lieutenants.

Heidt also gave a headcount for the county’s 270 non-union employees: (1) 26 elected officials; (2) 20 department heads – 18 in county units, and 2 in the trial court; (3) 181 professionals/managers – 146 in county units, and 35 in the court; (4) 34 support staff – 22 in county units, 12 in the court; and (5) nine non-union sheriff’s office employees – Heidt noted that these employees get wages and benefits matching the COAM union.

Negotiated union salary adjustments have generally been offered to non-union workers as well, Heidt said. Unlike union workers, non-union employees do not get automatic “step” increases, however, nor do they receive extra pay based on the length of time they’ve served, she said. Pay-for-performance increases for non-union employees have been on hold since 2009, she noted.

Labor Overview: Economic and Non-Economic Contract Provisions

Heidt reviewed elements of current union contracts that will be mandatory subjects of collective bargaining.

New hires are brought in at the first or second “steps” of their salary grade. With the administrator’s approval, someone can be hired at up to the midpoint of the job’s salary grade – beyond that midpoint, an offer requires board approval. On an employee’s anniversary date – typically the date of their hire – they get an automatic increase to the next step in the salary grade. Across-the-board increases for union employees are part of the contract negotiations. [.pdf of 2011 salary table for Washtenaw County]

When a union member’s job is reclassified, they’re eligible for one step increase at the new salary grade – that typically represents a 4% increase, Heidt said. For promotions, two step increases are granted at the new salary grade – generally equivalent to an 8% increase.

Longevity pay is also given to union workers, based on their length of service. These increases are distributed in different ways, Heidt said – some get the longevity pay once a year, other employees get the increases spread out as part of their regular paychecks. As part of the 2009 contract negotiations, different longevity pay scales were adopted for new hires.

Heidt then described the various retirement plans for county workers, noting that the board will hold a working session on this topic in May, with a greater level of detail. There are three plans:

• Washtenaw County Employees’ Retirement System (WCERS): A defined benefit plan with 1,001 members, 24 deferred members, and 727 retirees or beneficiaries.
• Municipal Employees’ Retirement System (MERS): A defined benefit plan only for employees of the sheriff’s office, with 286 members, 17 deferred vested members, and 10 retirees/beneficiaries.
• Voluntary Employees’ Beneficiary Association (VEBA): A 501(c)9 trust established to pre‐fund retiree health care benefits.

Employees also receive s “healthy” package of fringe benefits, Heidt said. Those benefits include Blue Cross/Blue Shield health insurance and dental insurance, life insurance, long-term disability, overtime and paid leave, among other benefits. She noted that as part of the 2009 contract concessions, most of the unions agreed to take eight unpaid “banked” leave days, which amounted to about a 3.1% cut.

They’ll also be negotiating a raft of non-economic provisions, Heidt said. Those include the grievance procedure, working hours, leaves of absence without pay, transfers, promotions, seniority, layoffs and “bumping,” progressive discipline and discharge, performance evaluations, and management rights.

Labor Overview: Next Steps

Heidt said the unions and administration use a method called interest-based bargaining (IBB), which AFSCME requested in 2002. It’s been very successful, she said, and involves trying to find options that benefit both sides. The process includes a discussion about why the positions that you’re taking are important – it’s not just making offers and counter-offers, she said, and the approach has dramatically enhanced labor/management relations.

On the administration side, the negotiating team will consist of Heidt; finance director Kelly Belknap; Donna Sabourin, executive director of the county’s Community Support and Treatment Services (CSTS) department; Bob Tetens, director of Washtenaw County Parks & Recreation; Lisa Greco, director of the county Children’s Services department; Dan Dwyer, Washtenaw County Trial Court administrator; and Judah Garber, representing the Trial Court’s Family Division.

The negotiating team will be backed up by a “base” team, Heidt said, which has some overlapping members. That group includes: Heidt; Belknap; Dwyer; budget manager Jennifer Watson; county administrator Verna McDaniel; deputy county administrator Bill Reynolds; Joanna Bidlack of the administrator’s office; Patrick Barrie, executive director of the Washtenaw Community Health Organization; county commissioner Rolland Sizemore, Jr.; Greg Dill of the sheriff’s office; and water resources commissioner Janis Bobrin.

Heidt said that she and Watson will be looking at financial projections.  At the March 3 closed session they’ll be asking the board for some parameters to use in negotiations. The closed session will also be the time to talk about their general labor relations strategy, she said.

On March 21 and 23, members of the negotiating teams and the budget planning team will go through training sessions for interest-based bargaining. Heidt extended an invitation to commissioners to participate as well. Training will be provided by federal mediators at no charge to the county, she said. Expedited negotiations will be conducted in March and April, with the goal of reaching agreement by July 1.

It’s important to set their goals and resolve these negotiations early, Heidt said, especially in light of uncertainties at the state and federal levels. Employees are very unsettled, she noted. “The sooner we can identify our future, the better off we’ll all be.”

Labor Overview: Commissioner Comments, Questions

Conan Smith, the board’s chair, observed that the process is always trepidatious, because it concerns people’s livelihoods. It’s important to know how the board should participate, he said. Part of their role is to set goals and direction – they’ll start that process in the closed session they’ll hold to talk about the labor negotiations, he said. Smith also noted that he didn’t believe the county had sufficient back-and-forth during concession talks with the POAM and COAM. [Those two unions, which represent employees of the sheriff's office, did not give concessions during the 2009 budget cycle, but earlier this year agreed to concessions that are expected to save a total of $5.6 million over a four-year period.]

How can they ensure that there’s effective dialogue? Smith asked. Heidt responded that the negotiating team is part of the process, along with the budget planning team. She said she’d be open to suggestions about how best to update the board regarding negotiations. The worst thing that could happen, she said, is if she signed a tentative agreement with the unions, brought it to the board for approval and discovered that it wasn’t what the board wanted. The board should know what’s coming, and that it fits within the goals and budget projections they’ve established.

Smith joked that his general inclination is to give Caryette Fenner anything she wants. (Fenner, president of AFSCME Local 2733, the county government’s largest union, attended the working session in the audience.) He asked Heidt to describe what the role of individual commissioners should be during this process. Are there any guiding principles they should follow?

Heidt said it’s important to remember that there’s a negotiating team that represents the board. Hopefully, commissioners are comfortable with that group, she said – if not, she needs to know. The different bargaining units are also represented by members who’ve been elected to do the negotiations. While it’s important to listen to concerns from employees, she said, it’s also important that commissioners not make promises – they need to consider what impact that might have on negotiations. Communication is crucial, but should be in the form of listening, then bringing any concerns to the negotiating team members, she said.

The pre-negotiation process includes information-sharing, Smith said. In the past, commissioners have heard from employees that they weren’t happy with the information they received – employees didn’t have faith that it was accurate and complete. Was there a process to ensure that this year, everyone’s on the same page?

Heidt said the administration is providing a range of information to the unions, including a survey of salaries and benefits in other communities that she’d just distributed earlier that day. The comparatives looked at the city of Ann Arbor and several other counties, including Ingham – where Michigan State University is located – as well as Oakland, Kalamazoo and Jackson counties, among others. [Excel spreadsheet of salary/benefits community comparatives]

A fringe benefits workgroup had met, looking at the costs associated with various benefits. That information was useful, Heidt said. The county’s budget and finance staff are also collecting information, including budget projections. In general, they’ll be giving unions whatever information union leaders request, Heidt said. That’s an aspect of interest-based bargaining, she noted – to be open, and ensure that they’re all “singing from the same hymnal.”

Smith said he’s impressed by both management and union leaders, who are committed to arriving at an outcome that’s best for the county, working as part of the same team. He said that earlier in the day, county administrator Verna McDaniel had characterized it this way: They’re all on the same plane. Smith joked that he hopes the plane doesn’t drop from the sky. Camaraderie was an important part of the previous budget discussions, he said, and he stressed his commitment to a process that’s as open, fair and inclusive as possible. “This will be as tough as it ever is, if not tougher,” he said, adding that he’s looking forward to the conversations.

Wes Prater asked several clarification questions. He noted that Heidt had indicated there are 1,287 employees in the pension system – he thought there were about 100 more employees than that. She replied that the number had been updated on Jan. 1. Employees who work less than full time aren’t included, she said.

Prater said he was also trying to figure out the number of supervisors compared to non-supervisory positions. He wanted to look at the organization’s “span of control” – the number of non-supervisors per supervisor. He thought the standard was 7 to 1, and he wondered what the county’s ratio was. McDaniel said the standard was more like 4 to 1. Heidt said she’ll gather that information.

Alicia Ping asked whether the comparative data that they’d collected on salaries and benefits had included non-union employees. Heidt said that this initial information looks at across-the-board salaries and benefits. As a part of the negotiation process, they’ll also be collecting comparables on specific positions, she said.

Responding to a question from Yousef Rabhi, Heidt clarified that there are 17 bargaining units, but that some of them work together for parts of the negotiation. There are five AFSCME units, for example – they usually work together for the broader issues, then split off talks separately for issues that concern just their specific unit.

Rabhi also asked for clarification about how the banked leave days work. Heidt explained that the majority of unions have banked leave, while non-union employees have furlough days. The main difference is that banked leave doesn’t affect retirement or longevity calculations, whereas furlough days do have an impact on retirement. She said they borrowed the plan from one that’s used by the state of Michigan, which was brought forward by the county unions several years ago.

Present: Leah Gunn, Kristin Judge , Alicia Ping, Wes Prater, Yousef Rabhi, Conan Smith.

Absent: Barbara Levin Bergman, Ronnie Peterson, Rolland Sizemore Jr., Dan Smith, Rob Turner.