CFL News
December 10, 2012

Quinn, state workers union firmly at odds in contract dispute

Pay raises, health care benefits are key points of contention

Source: Chicago Tribune

By Monique Garcia

Gov. Pat Quinn once shared a cozy relationship with the state's largest employee union as its members mobilized to help him win office two years ago. Since then, he's canceled union raises, cut jobs and targeted retirement benefits with the state billions of dollars in debt.

But it's the latest skirmish between Quinn and the American Federation of State, County and Municipal Employees that may have the highest stakes. The two sides have been bargaining on a new contract covering 40,000 workers who do everything from care for the elderly to protect children from abuse. Talks have dragged on for nearly a year, the longest negotiations in about 30 years.

In Illinois, state workers have never gone on strike. The Quinn administration and the union publicly declared that they want to keep that streak alive. But there's little indication they are any closer to reaching a deal than when talks began.

Tensions are high. Union workers hound Quinn at public appearances outside Chicago, accusing the governor of abandoning them and his Democratic principles of fighting for middle-class families. Administration officials argue there simply isn't enough money to go around, suggesting that every part of state government has had to cut back.

The sticking points are pay and benefits. Quinn wants the union to agree to a pay freeze for three years — an idea recently backed by House lawmakers — and to require workers and retirees to pay more for health care.

Union leaders argue Quinn's proposal would unfairly burden workers who already are struggling to get by after years of concessions, including unpaid days off, and hurt retired workers who live on fixed incomes and can't afford to keep up with rising health care costs.

Last month, AFSCME countered with its own offer, which would include no pay increases during the first year of the contract and unspecified "modest" increases to keep up with the cost of living in the following two years, according to a union spokesman.

The administration is expected to respond to the union proposal when talks resume Tuesday, but aides have indicated Quinn won't back away from his demand for a pay freeze. In the meantime, both sides are upping the pressure.

Quinn took the unprecedented step late last month of canceling the contract that employees had been working under. The move was largely symbolic since under state law the terms of the contract that expired July 1 remain in place.

But the decision further agitated workers already angry with Quinn for taking away raises and closing state facilities. The cancellation will "deepen employee frustration, provoke instability in the workplace and make settling a contract more difficult," AFSCME Council 31 Executive Director Henry Bayer said in a statement.

Administration aides said the governor had no choice but to send a message to union leaders that they must be more flexible during contract negotiations. The aides contended that in addition to insisting on raises, the union has failed to offer a proposal on how to cut retiree health care costs.

Quinn budget spokesman Abdon Pallasch said the administration already has demonstrated that it's willing to make concessions by backing off an initial proposal to cut worker pay. The union "has refused to recognize the extraordinary financial crisis squeezing the state," Pallasch said.

Odd politics

The face-off between Quinn and the union is a far cry from their relationship in 2010, when the powerful organization endorsed the governor in his bid for office against Republican Sen. Bill Brady of Bloomington. Just days after the endorsement was announced, Quinn inked a deal with the union to avoid layoffs in exchange for about $200 million in health care and overtime givebacks.

The state union and its national political organization also donated $575,000 to Quinn's campaign fund. Brady assailed the arrangement as an "inside deal" that would handcuff Quinn's ability to cut government spending, but the governor eked out a narrow victory.

Less than a year later, Quinn blocked raises for 30,000 state workers, saying lawmakers didn't set aside enough money for pay hikes. That move is playing out in court, with the administration planning to appeal a judge's decision Friday to require the state to eventually pay what it can toward the raises.

While Quinn's relationship with AFSCME is strained, Illinois government workers aren't facing the same situation as their counterparts in Michigan. That state is set to become a national focus for organized labor this week as the Republican-controlled Michigan Legislature puts the final touches on right-to-work measures that would make union membership and dues voluntary in the private and perhaps public sectors.

Still, Quinn finds himself in a bit of an odd political position: Democrats have historically been closely aligned with employee unions, which in turn provide key get-out-the-vote efforts during campaign season. Ex-Gov. Rod Blagojevich struck one of the more generous contract packages with the union, and even Republican governors before him tried to keep employees happy at the bargaining table.

This time around, Quinn is getting backing from powerful House Speaker Michael Madigan, who pushed a resolution that calls for a freeze in the amount of money the state sets aside for salaries. Madigan argued that lawmakers should have a bigger say in contract negotiations because they are the ones who vote on how much state government spends.

"It's a message to the governor's office, and it's a message to the unions representing workers in this bargaining," Madigan said late last month after the measure passed the House.

Numbers game

As is typical for labor talks, both sides are using numbers to try to spin the argument in their favor.

Quinn's office distributes a chart that attempts to paint Illinois union workers as higher paid than their counterparts in other states. But the document features just nine other states, and the administration won't explain its methodology, so it's unclear whether it is making an apples-to-apples comparison.

Meanwhile, union spokesman Anders Lindall tried to frame the debate by suggesting that increasing wages to keep pace with the cost of living would cost less than $1 a month per person in Illinois. But that math doesn't take into account that not everyone in the state pays taxes.

The union also makes a point that might not necessarily cut in its favor, pointing to U.S. census figures that rank pay for Illinois state and local government employee ninth out of 50 states. That's closer to the top than the bottom, which isn't something that can be said for state government on education funding.

When it comes to health care premiums, Illinois workers pay about the national average for state employees but far less than private sector workers.

The administration says an individual worker pays $564 to $1,014 a year in premiums, with copays as low as $15. The cheapest plan is in line with other states, with the national average for an individual state worker policy coming to about $563, according to a study released this year by the National Conference of State Legislatures.

By comparison, private sector employees paid on average $1,127 a year in individual health care premiums in 2010, the most recent year available. As such, the governor wants state workers to pay more in health care premiums and copays.

Many retired state workers now pay little or nothing in monthly health care costs, though last summer Quinn signed a bill to change that. They soon will pay premiums on a sliding scale based on pension income, which is another point of debate in contract negotiations. It's unclear how much Quinn wants premiums to increase for current workers and retirees, but he is asking that copays eventually be doubled.

The union's Lindall said the average pension for the state's 78,000 retirees is $34,000 a year, with about $3,000 of that going toward doctors' visits and prescription costs. He argues those on fixed incomes can't afford to pay more.

As for pay hikes, the administration contends that just a 1 percent increase would cost about $24.7 million, something the state can ill afford given the nearly $9 billion backlog in bills. The state's yearly operating budget is about $33 billion.

Lindall argues that it's a matter of misplaced priorities, saying Quinn has given millions of dollars in breaks to profitable corporations at the expense of public sector workers.

"It's hard to take seriously the argument that we don't have the ability to provide affordable health care to retirees who dedicated their careers to public service or that we don't have the ability to maintain middle-class wages for child protection workers or a caregiver for a veteran," Lindall said.

Quinn budget officials said all areas of government are being cut back, noting health care for the poor alone was cut by $2 billion this year.

"There are no sacred cows," budget spokesman Pallasch said.

While contract talks haven't officially reached a standstill, there are few signs the sides will meet in the middle any time soon. Lindall said the union wants to avoid a strike but said it appears Quinn is trying to "force workers into a corner."

For his part, the governor said last week that he "honors" workers and recognizes "the very important missions" they do every day. But Quinn said the state must address its "very severe" budget challenges. The sentiments are similar to those in a letter that Quinn sent to all state workers.

"We don't have the resources that perhaps existed in the past to pay pay raises to the government workers, we've already told them that and I think that message is getting through," Quinn said last week. "We have to tighten our belt because our state has a lot of bills to pay, and we have very modest resources, to say the least."

Twitter @moniquegarcia