Collective Bargaining In An Economic Downturn

Negotiating Successor Collective Bargaining Agreements – The Traditional Negotiation Format

Bureau of Labor Statistics numbers show major work stoppages dropped 95 percent this year compared with last year and are at their lowest level since the government began keeping a tally in the 1940s.

Labor peace has broken out across the country, and all it took was the nastiest recession since the end of World War II to spawn it. The Washington Times, November 3, 2009.

Agenda Current Trends Current Trends Strategic Considerations Strategic Considerations Salary Salary Insurance Insurance Language Language

Current Trends Delayed bargaining due to uncertain funding Delayed bargaining due to uncertain funding Initial board proposals calling for a pay freeze Initial board proposals calling for a pay freeze One year contracts One year contracts Historically lower salary increases Historically lower salary increases Language instead of money Language instead of money

Strategic Considerations

Do not approve administrator and non-union salary increases prior to completing negotiations Do not approve administrator and non-union salary increases prior to completing negotiations Share financial information and projections, early and often Share financial information and projections, early and often

Strategic Considerations Cost the union’s financial proposal on your own Cost the union’s financial proposal on your own Use “Package Proposals” to negotiate all economic issues Use “Package Proposals” to negotiate all economic issues Before you start – know where you want to end Before you start – know where you want to end

Salary

Negotiating Salary - Strategies Provide financial information – early and often Provide financial information – early and often Complete negotiations, then address administrator and non-union salary Complete negotiations, then address administrator and non-union salary Projections and model building Projections and model building

Negotiating Salary - Strategies Scattergram Issues Negotiating Salary v. Payroll Budget Negotiating Salary v. Payroll Budget Union targets savings from retired teachers Union targets savings from retired teachers What can you afford – know the end point What can you afford – know the end point

Negotiating Salary - Strategies “Diminished Expectations” “Diminished Expectations” Step calculations Step calculations Distribution issues Distribution issues Percentage vs. straight-dollar increases Percentage vs. straight-dollar increases Senior teacher concerns Senior teacher concerns

Negotiating Salary - Strategies Percentage of what (base, cell, total payroll) Percentage of what (base, cell, total payroll) Referendums and contingent funding Referendums and contingent funding Salary Re-Opener Salary Re-Opener

Health Insurance Benefits Cost Containment Options

Health Insurance Benefits – Trends and Recommendations Cost sharing formulas Cost sharing formulas Board/Employee share increases 50/50 Board/Employee share increases 50/50 Board pays maximum 5% increase in the premium per year Board pays maximum 5% increase in the premium per year Maximum dollar limitation on Board contribution Maximum dollar limitation on Board contribution

Health Insurance Benefits – Trends and Recommendations Promise levels of premiums, as opposed to levels of benefits Promise levels of premiums, as opposed to levels of benefits Consider offering lower tiered plans, i.e. Platinum, Gold, Silver Bronze. Consider offering lower tiered plans, i.e. Platinum, Gold, Silver Bronze. Health Savings Accounts for high deductable plans Health Savings Accounts for high deductable plans Cash option in lieu of insurance – include cost of TRS! Cash option in lieu of insurance – include cost of TRS!

Employee Health Insurance (Bad Language) The Board agrees to continue to pay the full employee medical and hospitalization insurance for full time employees. The Board agrees to pay medical and hospitalization insurance for part time employees prorated based upon the percentage of full time employment based upon the employee’s classification. Changes in the carrier, single and family rate, coverage, co-pays and deductibles shall require a joint decision between the Association and Board. A joint Board and Association committee shall be utilized to research and make recommendations to the respective parties.

Employee Health Insurance (Good Language) For each full-time employee who desires to participate, the Board shall contribute a maximum amount of $ per month for single coverage for the duration of this Agreement. Participating employees will pay any premiums in excess of the Board’s maximum monthly contribution. All employees are subject to eligibility requirements. The Board shall have the right to make unilateral changes to the medical and hospitalization insurance carrier, plan, coverage, co-pays, deductibles, single and family premiums and any other aspect of the health insurance program during the duration of this Agreement.

Significant Contract Language Issues

Language Issues Review contract and identify language that is costly Review contract and identify language that is costly Union – give us language if no money Union – give us language if no money

Language Issues Avoid the following: Maintenance of Benefits Clause Maintenance of Benefits Clause Subcontracting limitations Subcontracting limitations Class size limits Class size limits

Language Issues Avoid the following: Guaranteed work days/hours Guaranteed work days/hours Limits on Reductions-in-Force Limits on Reductions-in-Force Class schedules (4 Block, 7 Period, 8 Block) Class schedules (4 Block, 7 Period, 8 Block)

Barney R. Mundorf 310 Regency Centre Collinsville, IL FAX Questions and Comments