Monday, June 29, 2009

8% Confusion

I don't get it.

Fall River is facing a dire budget situation. State aid is being cut and the city has limited means to raise any revenue on its own.

So the city is forced to tighten its belt. You would think this would mean that our city leaders would be looking for ways to reduce spending, eliminate waste, and save money. At least you would hope right?

Instead the first thing we've heard about is "8%". In order for the city to balance the budget without laying off more city employees the Mayor says all city employees need to take an 8% pay cut. They also need to make some concessions with their health insurance. The last time Bob tried this, oh just a few months ago, only one union decided to come negotiate and most of the rest saw drastic layoffs.

This time around we can't afford to layoff more people, more police, fire, teachers, administrators, DPW workers. We can't afford to reduce services. We can't afford to have more of our citizens out of work.

So I'm glad to see one union step up to the plate and work with the Mayor. the American Federation of State, County and Municipal Employees has agreed to an 8% cut. This will provide the savings the city needs and make sure our city employees keep their jobs. The problem I have is this isn't an 8% cut in salary. Instead the 8% cut was achieved by reducing hours.

I guess whatever allows you to reach your goal, but an 8% reduction in hours is an 8% cut in productivity! To reach this 8% members of the AFSCM will work 32 hours a week instead of 35, but now they will get a paid 1/2 lunch meaning they are really only working 29 1/2 hours a week. City services are going to be impacted by the loss of almost 6 man hours a week per employee. Hey, great job by the union in negotiating a favorable deal for their members but how is this good for Fall River?

What happens if these workers now end up working overtime to make up for the lack of man hours? There goes any savings! How will this affect other negotiations? Why would other unions take a cut in wages when they can bargain for less hours and paid lunches?

Lefty's View: It's great to see the a union step up and work with the city, and it's great to see the city willing to compromise to make a deal happen. The problem is this deal cuts city services and sets a bad precedent that may make future negotiations difficult.

8 comments:

Anonymous said...

it only cost us 75k in salary for a 20hours a week labor attorney to save that money!

Anonymous said...

I do not like to lose services in the city, but in all fairness, I do not want to see city workers take a cut in pay and continue to do as much, or more, than before.

Lefty said...

Anon,

I feel the same way, but pay cuts are preferable to job losses. I could also see paying for a 1/2 lunch to help make up for a pay cut.

There are certainly plenty of people that have had to take pay cuts in the private sector. I don't think it's unfair to suggest the same for public workers.

reality check said...

Correction, during the first round all unions sat down to negotiate. Unfortunately, the city gave unions a take it or leave proposal. There was never any willingness on the city's side to bargain. Also, if the unions gave up the 8% for 2009 instead of layoffs, they would still be asked to give up another 8% for 2010. Most of those AFSCME workers will be losing between 2 and 3 thousand dollars a year and you're worried about being inconvenienced.

Lefty said...

I certainly am not worried about being inconvenienced. What I am worried about is the lack of police officers and fire fighters and how much worse our public safety will be impacted if there are additional layoffs.

I'm concerned about dirty streets because we don't have enough DPW workers to do the job. I'm concerned about LARGER classroom sizes and an ever growing backlog of forms and documents that can't be processed because there isn't enough time in the shortened work day to do it all.

However you make an excellent point that if these unions had agreed to an 8% cut in FY09 they'd now be looking at another 8% in FY10 not the additional 2% bob was asking for back in February. But I think the Mayor is basically saying take or leave it now too. Maybe it's not 8% cut in salary but the result is an 8% cut in your pay.

My problem is the deal the city has no real benefit except protecting jobs. The cut in hours will mean work isn't getting done and that will either result in the need for overtime or the chaos.

Dr. Momentum said...

If the workers simply take a pay cut, they are being asked to make most of the sacrifices. An hour reduction is more fair because the burden is shared; the city (and citizens) make a sacrifice in services and convenience and the workers give up some of their pay, but get some of their time back.

It's not ideal, but it's a little more fair.

The idea that a straight pay cut results in better services (because the hours are still there) doesn't take into account the fact that pay cuts do impact efficiency because of their effect on morale.

I can't tell you what the balance point is, but it's not as simple as same hours for less pay = same services.

I understand your frustration. Perhaps a time cut could be combined in a small cut in hourly, taking some of the salary but giving folks some time back.

In any case, layoffs, paycuts and timecuts are all bad for pretty much everyone. There is no easy answer.

Lefty said...

Hey Doc.

I certainly do not mind a compromise between the city and union, I just don't feel this deal was the best that could have been put together. The pay cut comes from a reduction of hours and on top of that the city is paying for a 1/2 lunch break. so the city workers work 30 hours and get 4 paid 1/2 lunch breaks. (a correction from what I earlier blogged).

Why did the city have to reduce hours AND pay for lunches? Why not reduce pay slightly and provide the 1/2 paid lunch break?

But you're right, no easy answers in these tough times.

Dr. Momentum said...

I don't know why their lunch time should be paid. I agree with you.