CFL News
October 03, 2011

Arbitrator rules that Quinn layoffs, closures violate union contract

An independent third-party arbitrator has ruled that the State of Illinois is violating the terms of a collective bargaining agreement by laying off more than 1,900 state employees and closing seven state facilities

An independent third-party arbitrator has ruled that the State of Illinois is violating the terms of a collective bargaining agreement by laying off more than 1,900 state employees and closing seven state facilities, including three psychiatric hospitals, two developmental centers, a prison and a juvenile detention center.

In a binding opinion and award issued this morning, arbitrator Edwin Benn found:

“In 2010, the State of Illinois and AFSCME Council 31 entered into a series of concession-granting agreements in which the union agreed to reduce the state’s financial obligations under the parties’ 2008-2012 collective bargaining agreement by approximately $400,000,000. In return for those concessions agreed to by the union and the employees, the state guaranteed that no employees represented by the union would be laid off through June 30, 2012 and … there would be no closures of state facilities prior to July 1, 2012. …

“[T]he state is in violation of the clear language of the relevant Cost Savings Agreements. …

“[I]n the exercise of my discretion to formulate remedies and to restore the status quo ante and to make the adversely impacted employees whole, no employees represented by the union can be laid off through June 30, 2012; the seven … facilities targeted for closure cannot be closed prior to July 1, 2012; and if any employees represented by the union are laid off, bumped or transferred as a result of layoffs and facility closures involved in this matter prior to July 1, 2012, those employees shall be reinstated and returned to their former positions and made whole in all respects for their losses flowing from the state’s violation of its contractual promises … .

“The make whole relief for the adversely impacted employees includes payment by the state to those employees for lost wages and benefits.

“The make whole relief further includes compensation to adversely affected employees for medical expenses … which would otherwise have been paid for or covered by insurance had the employees not been laid off in violation of the Cost Savings Agreements.

“Additionally, if as a result of the state’s violation of the Cost Savings Agreements, adversely impacted employees are put in a position of not being able to make timely payments on their homes or cars and are foreclosed upon or evicted or otherwise forced to move from their residences, as part of the make whole relief the state shall compensate the employees for those losses.”

“This order is unequivocal. Governor Quinn should rescind all threatened layoffs and closures,” said AFSCME Council 31 executive director Henry Bayer. “Failure to do so will not only harm the vital public services state employees provide, it will expose the state to significant damages for lost wages, benefits and other costs incurred as a result of the governor’s irresponsible actions.”

Arbitrator Benn also underscored the economic harm the state’s threatened layoffs and closures would cause:

“Given the extraordinarily high unemployment rates in Illinois and as a result of the state’s clear violation of its promises … employees who gave concessions to ease the state’s financial difficulties and in return were promised by the state that they had job security and would not be laid off through June 30, 2012, will, because of the state’s violation of its promises, be thrown into an economy with little chance of finding comparable employment. This recession has shown me all too well what happens when employees are laid off in the kind of economic conditions now stressing the country and Illinois … a high potential of foreclosures and evictions from their homes and residences for not being able to pay their mortgage or rent, loss of health insurance, loss and lack of medical care and the overall trauma of being unemployed in a very unforgiving economy.”

Benn makes clear that Governor Quinn’s contention that he is free to violate the union contract based on the amount of funding appropriated by the General Assembly is without merit:

“There are no … provisions in any of the agreements involved in this case which make an economic contract commitment by the state in any way contingent on the passing of a budget by the General Assembly sufficient to pay for those economic commitments.

“The state made contractual promises to not lay off employees represented by the union and to not close facilities prior to July 1, 2012. The state simply must keep those contractual promises. A party is not excused from previous contractual obligations by claiming that it presently can no longer afford to meet its obligations.”

Finally, Benn emphasized that the integrity of the collective bargaining process itself is at stake in this case. Restating his finding from his July award ordering the state to rescind Governor Quinn’s unilateral pay freeze and follow the contractual pay schedule, the arbitrator wrote, “if the state is correct in its statutory and Constitutional arguments, the multi-year collective bargaining agreement is, for all purposes, probably dead.”

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