As it has been for years, the recent negotiation of a union contract with Haines Borough employees was a secretive, then rushed affair that did not serve the interests of the borough, its elected leaders, union workers, or the general public.
About 15 years ago, the union and borough leaders agreed that all negotiation issues – such as what workers wanted, and why, and what our elected leaders wanted, and why – would not be discussed until a draft contract was produced.
This year, as in past ones, most assembly members and the public didn’t get the benefit of that discussion even after a draft contract revision was completed. A memo showed up in the borough packet detailing the changes May 28, and the assembly — as typically happens with the union contract — hurriedly approved the document Tuesday with no questions asked.
I wasn’t satisfied with the changes, or the presentation of the contract by borough officials.
Perhaps the biggest sleight of hand is the contract’s cost. It’s low-balled by staff, and subsequently by the media. “If the school bond debt retirement is funded 95 percent or more, union employee wages will increase by 4.5 percent over three years at an estimated cost of $110,000 to the borough,” reported the Chilkat Valley News.
That $110,000 number is misleading. Here’s why. Including the contract’s increased taxpayer support of employee health benefits ($40,000 annually), the estimated cost of increased compensation to borough workers isn’t $110,000 but $150,000, according to borough finance officer Jila Stuart. Further, that $150,000 is the cost of the new union contract only in its first year. In the second year of the contract, the cost to the borough will be $248,000. In the contract’s third year, its cost to the borough will be $350,000. In sum, if the school bond debt retirement is funded 95 percent or more, the actual cost of the new contract to the borough would be those three amounts combined, or $748,000.
(The borough’s description of the increase is like describing the cost of the house by its mortgage payment. Car dealers do a similar thing, describing payments instead of a total sale amount. It’s a way of making big costs look small.)
In fairness, if the state reduces school bond debt retirement by 30 percent or more, increased compensation to Haines Borough union workers will total just $414,000 over the next three years.
This much is certain, borough union worker compensation will increase over the next three years at a combined cost to local taxpayers of between $414,000 and $748,000.
Under any scenario, workers are getting a good raise, in addition to ones they automatically receive on the “step chart,” which is essentially a raise government workers get for just sticking around another year.
The reason that the contract wording about the compensation increase is conditional is that the borough has no good idea what amounts of support it will receive in two critical areas — school debt bond reimbursement and community assistance — when Alaska Gov. Mike Dunleavy gets done with his veto pen.
Because of this uncertainty, I suggested that instead of approving increased health care benefits and increased pay, the assembly agree to fund only increased health benefits and ask the union for a one-year delay in raises until we understand how deeply Dunleavy will cut. (Dunleavy is in the first of his four years as governor.)
Predictably, my proposal went nowhere.
That was disappointing, considering that at the very same meeting the assembly decided that the borough’s financial situation was dire enough to eliminate free swims at the pool for children and cut non-profit funding nearly in half. (The assembly, interestingly, didn’t find the situation quite dire enough to reduce its own pay. I am pursuing an ordinance that would limit assembly pay to incurred costs. You can read about it on this site under the title, “Pay Assembly Expenses, Not More.”)
But let’s get back to the contract and just two of the goodies it contains:
- Cash for accrued leave. Besides 11 paid vacation days – including ones you’ll never get like Alaska Day, President’s Day and Friday after Thanksgiving – borough workers get up to 32 days of leave off per year to be sick or go on vacation. That’s right. If you’ve been with the borough for 10 years, that’s nearly two months off. (Starting employees get 20 days of leave — or one month — off.) Employees, when they retire, also can “cash in” up to 14 weeks of leave that they haven’t used. That’s effectively a cash bonus equal to 3½ months’ pay. The contract also allows for sick leave and leave without pay.
- Comp time. Officially “compensatory time,” this benefit provides workers with time off, instead of overtime pay, for time spent on the job, most often hours worked outside of the regular work schedule. Under this arrangement, if you work an hour now, instead of pay for that hour, you can get off for an hour later. Or if you work an hour of overtime today, you can take off from work 1½ hours tomorrow. It’s not clear to me why comp time is even in the union agreement. According to Insperity, a professional employer organization based in Texas, it’s illegal to offer comp time to “non-exempt employees.” (Such employees are not exempt from the rules of the federal Fair Labor Standards Act, which generally requires overtime pay for overtime hours.) Salaried, supervisory positions are generally exempt from FLSA. Is the borough operating outside the law? I’m looking into this. But Insperity says – and others agree – that offering comp time even to exempt employees is poor policy for the following reasons:
- “Some employees make take advantage of the offering – for example, working overtime unnecessarily so they can get a day off in the future.”
- “It can lead to wage and hour claims and disputes over whether employees are truly exempt or nonexempt.”
- “If an employee has saved up a lot of comp time and then quits, do you need to pay for those banked hours?”
Insperity goes on: “If you do offer comp time, make sure you cover the rules with a strict and stringent company policy. Also, make sure comp time is used as an occasional reward, not an hour-for-hour overtime exchange.”
Let’s just assume – because I don’t have confirmation on this yet from the borough – that salaried employees are not getting comp time. That is, that borough officers whose overtime hours are folded into their high salaries, are not claiming comp time. In other words, when the manager has a four-hour evening meeting, the manager is not taking off six hours the next day. That’s the point of a high salary, that you’re being paid, in advance, for working extra hours.
So if comp time, by law, is not allowed for union employees and we assume that it’s not being paid to salaried employees, just what is it doing anywhere in borough pay?
According to information provided by the borough, in the past year, comp time has been made employees in the following departments: administration, lands, dispatch, finance, police, public facilities and sewer.
(Since writing this post, Borough manager Debra Schnabel shared with me that she also has concerns with comp time. As the contract maintains that comp time must be approved by the manager, Schnabel told me on June 18 that said she will limit it to borough paramedics, for whom an allowance is apparently made in federal law. What will happen with comp time after Schnabel’s departure is anyone’s guess. The questionable allowance for it remains in the contract.)
Finally, consider this little-known piece of candy at City Hall.
When I asked our borough manager why she had awarded Police Chief Heath Scott a 2½ percent pay raise within six months of his hire, her reasons included that pay raises extended to union workers by contract have traditionally been extended to non-union employees as an informal policy.
So what is the real, total cost of the new union contract? Were any of these issues raised by the borough’s negotiating committee? What became of them?
I’d have liked to discussed these issues last winter when the borough was putting together its committee of assembly members to negotiate with the union. Other assembly members blocked my request to serve on that committee.
So I’m asking now.