DC 37 Reaches Timely 44-Month Pay Deal City Sees as a Pattern

Chief Leader - July 04, 2018

by RICHARD STEIER

Provides 7.25% in Raises, Fringe-Benefit Gains And Family-Leave Rights

District Council 37 June 26 became the first municipal union to reach terms on a new contract in the current round of bargaining, agreeing to raises of 7.25 percent over a 44-month period retroactive to last Sept. 26, small improvements in welfare-fund and other benefit payments, and a family-leave program modeled on a recent state deal.

There were two significant questions raised regarding the impact and the timing of the deal, which was announced in a hastily-called press conference in the City Hall Blue Room.

Possible City Pattern?

One was what effect the accord, which must still be ratified by DC 37’s rank and file, would have on other unions’ bargaining, and the bid for arbitration by the Patrolmen’s Benevolent Association.

The other was whether getting the deal had a special urgency for DC 37 Executive Director Henry Garrido, since its announcement came a day before the U.S. Supreme Court ruling nullifying public-employee unions’ right to collect the equivalent of dues from those opting not to become members. That decision, which concerned a lawsuit filed against an Illinois chapter of the American Federation of State, County and Municipal Employees, which is also the national parent of DC 37, was expected to have a ripple effect under which those who were full union members might decide it made financial sense to opt out of their own dues obligations.

Securing a pact, which if ratified would include what is already more than nine months of accrued retroactive pay, just before the Janus v. AFSCME decision provided a ringing response to any DC 37 members who might be inclined to ask: what have you done for me lately?

‘Extremely Important’

“I think it was extremely important,” he said, for reasons including the deal’s effect in blunting possible efforts by national right-to-work organizations immediately after the Janus decision that the best way for DC 37 members to improve their pay would be to cease paying dues. In addition to the raises under the tentative deal—which will total 7.42 percent once they are compounded—and some key fringe-benefit gains, he noted, “There was language put in the contract in preparation for the decision” that will speed the union’s efforts to enroll new members.

The agreement was actually reached a day before the press conference, with an announcement deferred because it was contingent upon completion of a deal aimed at producing $1.7 billion in health-care savings over four years involving all municipal unions. This was a continuation of an accord reached 49 months earlier that had easily surpassed its target of $3.4 billion in savings. A key element of producing the new savings will be an agreement the umbrella group for the unions on health benefits, the Municipal Labor Committee, and city negotiators reached with EmblemHealth that will cap health-care increases at 3.5 percent next year and 3 percent in 2020.

Labor Commissioner Robert W. Linn, who in a phone interview following the press conference noted that the health-benefit savings helped fund the financial terms of the DC 37 deal, said of the pact, “I believe this is a framework for negotiations going forward with the rest of the workforce.”

Arbitration Uncertainties

He declined comment on how it might affect a possible arbitration bid by the PBA, now under consideration by the state Public Employment Relations Board, which must rule that a bargaining impasse exists before that process could begin.

In 2015, Mr. Linn was able to convince an arbitration panel to limit raises for the city’s largest police union to match the pair of 1-percent pay hikes accepted by other uniformed unions at the start of seven-year contracts. But a decade earlier, when DC 37 was the only union with a contract in place when an arbitration ruling came due, the PBA was able to convince panel chairman Eric Schmertz to grant incumbent cops raises significantly better than were obtained by DC 37, with part of the extra cost made up by sharply reducing starting salary and the pay scale for future Police Officers.

One PBA official, asked to comment on how the new deal might affect its arbitration case, replied, “We have no reaction. We don’t think it’s going to affect our contract.”

Union President Patrick J. Lynch was more definitive, subsequently saying in a statement that he would not be “bound by a one-size-fits-all wage pattern that was structured around the needs of other city workers and does not address the enormous wage disparity that New York City police officers face” with cops in neighboring jurisdictions.

An Objective Assessment

One veteran of the bargaining wars, speaking on condition that he not be identified, offered a nuanced view of the DC 37 terms and their impact on the rest of the municipal labor force.

Assuming the union’s rank and file ratified the deal, he said, “I think it’d probably set a pattern for most of the non-uniformed unions. It may set a framework for the uniformed unions, depending on how they react to it.” He offered no prediction as to how it might affect the PBA, assuming that union winds up in arbitration.

United Federation of Teachers President Michael Mulgrew offered no reaction to the DC 37 terms, beyond a spokesman’s noting that heads of the union traditionally congratulated whichever union made the first deal of a bargaining round and then went about trying to reach terms that suited their members’ needs.

Teamsters Local 237 President Greg Floyd said in a phone interview a few hours after the pact was announced that a deal tailored to DC 37’s rank and file might not be the right fit for his own 24,000 members, who include Housing Authority workers, security personnel in agencies including the social-service agencies and the Department of Education, and titles including Cooks in the city jail system.

“There are certain needs that our peace officers and other titles have that we’ll look to address,” he said.

Will Compare Leave Benefits

Asked about DC 37’s decision to sign on to the state family-leave plan rather than the paid-parental-leave terms negotiated by the UFT a week earlier, Mr. Floyd said that in considering what path to take for his own members, “We have to look at the cost factor. We’ll have to see what the members want” and weigh that against the price tags of the two leave programs.

Under its parental-leave deal, the UFT opted to cover the cost of giving members full pay while taking up to six weeks of maternity, paternity, adoption and foster-care leave—which they could supplement by up to eight weeks of other leave—by extending its wage contract, which had been due to expire Nov. 30, by 73 days. That benefit does not offer the option of taking paid time off to care for an ailing relative.

DC 37 opted to take the less-generous but lengthier family-leave benefit offered by the state to its unions, which would not take effect for its members until Jan. 1.

The terms reached a month prior to the DC 37 deal by United University Professions, which represents instructors in the State University of New York system, grant family leave for up to eight weeks to take care of a newborn or a sick relative, or to assist family members who are serving military duty. They will be paid just half their salaries during that period, with a cap on the maximum weekly payment of $652.96. Under the UUP deal, the terms will grow more generous with time: next year they will be able to take off up to 10 weeks and receive 55 percent of their average weekly salary, and by 2021 will get up to 12 weeks off while receiving 67 percent of salary.

Pay Cap for DC 37, Too

The DC 37 benefit, assuming the pact is ratified, will pick up next year at the state level: 10 weeks of leave at 55 percent of salary. The cap on salary will be determined by the average weekly wage for state employees.

Mayor de Blasio noted that the savings under the program are enforceable through arbitration. The caps in cost increases agreed to with EmblemHealth figure to make the targeted savings relatively easy to achieve without imposing significant cost controls on union members. Another key cost-saving element is the requirement that all new employees automatically be enrolled in the Health Insurance Plan of Greater New York. After one year of service, they will be able to opt for a different health plan with additional features, which might include added out-of-pocket costs.

Several areas of savings represent expansions of programs implemented as part of the 2014 deal to meet the larger cost-cutting goal. They include greater use of health clinics or doctors’ offices rather than hospitals—with no additional charges for employee health-care premiums—for procedures such as arthroscopies, colonoscopies, cataract removals, radiology and ambulatory surgery. A new fertility support program will supplement wellness initiatives already in place to manage chronic conditions like asthma and diabetes, and prices will be cut for some drugs.

Wage-Term Breakdown

Under the DC 37 contract, a 2-percent raise would be paid retroactive to Sept. 26, 2017, with a 2.25-percent raise kicking in this Sept. 26. The final hike of 3 percent would take effect Oct. 26, 2019, and the pact would run for another 19 months, expiring on May 25, 2021. There would also be a $50 increase in city contributions to DC 37 members’ welfare funds. All members who come on the payroll after the deal is ratified would be paid by direct deposit.

The union also negotiated nearly $40 million in funding to address needs specific to certain groups it represents and an education-related benefit offered to all members that combined add to the cost of the deal by roughly six-tenths of a percent. That includes allocations of $12.6 million each to an equity fund meant to supplement pay in hard-to-recruit titles and for an additional compensation fund that in the past was covered through “unit bargaining.” Another $8.5 million will be allocated to the union’s education fund, and the final 3-percent raise under the deal will also be applied to some fringe benefits, most notably longevity pay.

'Accommodating Needs'

Regarding the money set aside to address salary issues in designated titles, Mr. Garrido said, “What makes us unique is that DC 37 represents so many titles. One of the criticisms we’ve heard is that pattern bargaining doesn’t accommodate the needs of many of the professional titles.

He noted that the equity panel will be overseen by Alan R. Viani, a veteran arbitrator who during his decade-plus tenure as DC 37’s chief negotiator during the 1970s and 1980s worked on the original equity panel negotiated by the late Victor Gotbaum as DC 37’s executive director.

The panel’s focus will generally be on what Mr. Garrido described as “hard-to-recruit, hard-to-retain titles,” where annual turnover is sometimes 30-to-40 percent.

He cited as one example Medicolegal Investigator, which is represented by Health Services Employees Local 768. The local’s president, Fitz Reid, has lamented constant shortages in staffing that have resulted from a large gap in what persons in that title are paid and what can be gotten in the private sector.

“They get experience, they’re here two years and then leave for jobs” in the private sector and hospitals, Mr. Garrido said.

A similar dilemma is faced by Nurses represented by his union, whose salaries are well below those who are represented by the UFT. And the union has some members who are in physically-taxing jobs that are not grouped with prevailing-rate employees whose pay is linked to the equivalent titles in the private sector. This exclusion means they also are inclined to leave for better salaries that reflect the physical demands of their work.

‘Not a Complete Fix’

The equity money offers “a way of making progress [in addressing disparities], not of completely fixing the problem,” Mr. Garrido said.

On the same day his deal was announced, it was unanimously approved by union delegates. A schedule was in the process of being set for the mailing of ballots to the rank and file for final ratification.

The terms also provide assistance to DC 37 in coping with the fallout from the Janus decision that go beyond the state law signed by Governor Cuomo in April that made the right to union representation in grievance and arbitration cases contingent on employees paying union dues.

As a way of addressing concerns raised by the Janus decision about having difficulty signing up new members, the de Blasio administration has agreed to regularly report to DC 37 on new hires and transfers of workers into its bargaining unit. It will also offer reasonable opportunities to meet with newly covered employees to make the pitch to them to enroll in the union, and provide swift notification regarding employees who are promoted into titles represented by DC 37.