Mayor Nutter announced Thursday that effective October 1, city workers would receive a 2.5 percent increase in pay. This in the midst of union negotiations that have been stalled for three years. The point of contention – pay raises at the expense of worker benefits.
The compensation package, unveiled publicly Wednesday after private briefings for elected officials, union leaders and the news media, apparently has a two-pronged purpose – to provide a raise for nonunion personnel who have gone without a pay increase for up to five years, and to show the administration’s commitment to the basic principle that the cost of any employee wage increases must be covered by equivalent concessions in work rules and benefits.
“It is unfair to deny compensation improvements to one group,” said Mayor Nutter, “simply because union leaders representing non-uniformed employees decline to act in the interests of current and future employees and taxpayers.”
The 5,500 employees affected would receive a pay increase, the first in more than five years, but would also be required to pay more in health care costs and pension contributions.
“This is not something we would accept,” said Cathy Scott, president of District Council 47.
Close to 12,400 administrative and union employees are at the heart of the debate.
Perhaps the biggest change is a revision to healthcare benefits for employees in the city’s HMO plan, which could dramatically increase costs for some employees. The city offers two health plans — an HMO and a PPO plan. Under the new benefits package, PPO costs for employees would remain roughly the same. For employees enrolled in the HMO plan costs would jump — in some cases tripling.
Exact costs depend on the specific employee, but according to figures provided by the administration, for the average employee with family benefits, the cost would go from $42 a month to $141. For a single employee the costs would rise from $14 a month to $49.
Several of the city’s service workers have reached agreements in their union negotiations, including police officers, city prison guards, probation officers and deputy sheriffs. Their contracts are current. However, the city’s firefighters have not reached agreement.
For the second time, the city is appealing an arbitrator’s ruling giving a pay increase to city firefighters, on grounds that the arbitrator paid inadequate attention to the city’s still-precarious finances.
Historically, the city has provided wage increases to civil service personnel, city court workers, administrative officials and first-level supervisors throughout the city to match whatever it negotiates with the non-uniformed employees in DC 33 and 47.
Due to the prolonged stalemate with the unions, said Mayor Nutter’s chief of staff, Everett A. Gillison, the administration decided to move ahead on its own and impose a new wage package. The package, according to Gillison, pays for itself with benefit concessions, i.e., higher co-pays for health insurance and higher contributions toward employee pensions.
Overall, the plan would cost the city just above $17 million over the next five years. According to Budget Director Rebecca Rhynhart, the cost is about one-tenth of one percent of what the city is likely to spend over the five-year period.