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John C. Post Lodge #44 Fraternal Order of Police Proposed Senate Bill Five Potential Effect On Our Members
Senate Bill #5 l Addresses Public Employee Collective Bargaining Law l Affects l State Employees l State University Employees l Police & Fire Supervisors l Local Government Employees l Teachers l Anyone covered under ORC 4117 (Collective Bargaining) 2
Dispute Settlement ØSERB ØMediator ØFact Finder must hold interest of public and employer’s ability to Pay to be primary. 3
Establish Pay Ranges ØEliminates Step Increases ØPay Increases based on Merit ØEliminates Longevity ØOvertime Rate guided FLSA ØProhibits Pension Pick-ups 4
Time Line for Senate Bill 5
February 8, 2011 l 475 page Senate Bill 5 introduced before the Senate Insurance, Commerce and Labor Committee. l l Senator Shannon Jones sponsors the bill Huge changes to the current collective bargaining law ORC 4117 that had been in effect since 1983. No copies of the bill were provided to the Committee prior to the introduction of the bill. FOP was denied access to drafts of the bill as well. No interested party meetings before introduction of the bill
February 15, 17, and 22 l 22 hours of testimony Proponent l Opponent l l Testimony was curtailed before everyone who signed up was given the opportunity to speak.
March 1, 2011 l 99 Pages of Amendments l Brief overview of the changes. l l l Not comprehensive in any regards Legislators had not been afforded the opportunity to review the amendments prior to this date. Senator Jones did offer to answer the Committee’s questions. l l Questioning was difficult with such short notice and the length of the amendments. Once Committee Members began to ask questions, the meeting was adjourned.
The 99 Page Amendments March 1, 2011 was the first glance anyone had of the amendments. l Greater limitations on Public Safety Bargaining l Significantly more harmful to labor management relations than the bill itself. l No additional proponent or opponent testimony was heard by the Committee in regards to the amendments. l
Significant Insurance Change l The original Bill mandated 20% employee share for Health Premium l The amendment reduced this to 15%. l This matches the 15% that the senators pay for their own health care. l No negotiation for Plan Design
March 2, 2011 l The Morning l l Less than 24 hours after receiving the amendments to review Senate President Tom Niehaus removes Senator Bill Seitz (R) Cincinnati, from the Committee. l l l Seitz is well respected senatorial veteran Wants collective bargaining reform Believes Senate Bill 5 was far too sweeping. Did not support Senator Seitz was replaced on the Committee by Senator Cliff Hite (R) Findlay l Hite had heard no testimony on the bill or amendments. With his vote the bill was voted out of the committee.
Later on March 2 l Senate leadership removed Senator Scott Oelslager (R) Plain Township from the Rules Committee Extraordinary Measure l Oelslager had voted against the bill. l His removal allowed the bill to move to the Senate Floor by a 7 -5 margin. l
March 2 --Senate Bill 5 Passes Senate l. A request for the bill to be read to the floor of the senate was denied l No further testimony was provided to the members who were not on the committee l Senate Bill 5 was passed by a 17 -16 vote.
Provisions of SB 5 As it stands coming out of the Senate
Pension Pick Ups l PROHIBITS l PENSION PICK UPS SAVES THE EMPLOYER MONEY l FOR EVERY 1% RAISE IN WAGES = 1. 24% AFTER ROLL UPS
Seniority and Fairness l NO AGREEMENT MAY PERMIT LAYOFFS BASED SOLELY UPON SENIORITY Opens the door Age Discrimination l Protected Class Discrimination l Huge financial liability for Local Government l Allows political favoritism l
Privatization l ALLOWS PRIVATIZATION l CONTRACTING OUT ANY PUBLIC EMPLOYEE SERVICES l Job Security for employees is completely gone.
Staffing Levels l No to longer able to negotiate in reference Shift l Facility l Piece of Equipment l Supervision Span of Control l l THIS l IS A SAFETY ISSUE Especially with 4 -man Staffing of fire apparatus
Fair Labor Standards Act Guidelines l Mandates l FLSA Overtime Calculation This eliminates l “Call in Pay” l “Court Time” l No rate over 1 ½ can be paid l Requires 171 hours in a 28 day cycle before overtime is paid l Paid leave does not count toward 171 hours
Basis for Pay Increases l Mandates l merit-based pay Police and Fire moved away from this standard To eliminate corruption l Eliminates Quotas (Which are Illegal) l Cannot define merit pay l
Layoff Due to Township Annexation l Seniority no longer a factor l Reduces job security
Past Practices l Past Practices not protected l Requires re-negotiating every article of every contract
Changes in Benefits and Pay Outs l Longevity l l l Eliminated for DROP Capped for at 3 days for other employees Vacation Cap l l 5 weeks max 240 hour max accrual (<20 year employee) Holidays limited to 12 annually l Personal Days -3 days annually l Sick leave buy back capped at 500 hours l
Changes in Negotiation l Prohibits direct dealing for union with elected or appointed officials but permits direct dealing by employers l Seriously limits ability to compromise l Eliminates SERB Unfair Labor Practice Investigations
Why change collective bargaining l Gives local governments ability to control personnel costs l Local Government Fund could be cut l Senator Jones in SB 5 hearing stated she did not know potential savings l Ohio Dept of Administration Services provided estimate of cost savings l ODAS used 3 provisions in cost analysis
Provisions used in Cost Analysis l Limiting state and local government payments for health care l Eliminating Step Pay l Eliminating Longevity Pay
Projected 2010 fiscal year savings using 3 provisions l State would save $216, 871. 804 or $3, 739 per state employee (58, 005) l Local governments would save 1. 12 billion
Breakdown of projected savings for the State of Ohio l Health Insurance $25, 555, 572 l Step Pay $75, 965, 060 l Longevity Pay $115, 351, 172
Local government projected savings l Health Insurance l Step Pay l Longevity $132, 200, 000 $392, 700, 000 $596, 400, 000
Flaws in projected savings l Many public employees pay 15% or more for health insurance currently l Many public sector unions such as Dayton FOP have worked with mgt to drive down costs l Public employers generally have same insurance carrier and plan design for all bargaining units. Rates are based upon number of participants in plan.
l In Dayton, several of the cost savings measures were the result of the Unions directly communicating with the Legislative body and working things out informally. SB 5 prohibits this communication
l Assumes step increases of local government employees are equal to state employees l Step increases actually save employers money. In Dayton, we expanded the number of steps to reach top pay to 78 months. This has saved Dayton millions of dollars.
l The 1. 12 billion projected savings is based upon paying 20% of the total premium costs. This was amended to 15% but ODAS did not recalculate the projected savings.
l Not every public sector employee receives longevity and if they do, it may not be equal to what state employees receive
l Some of the benefits of the 3 provisions were negotiated where there were trade offs with management which resulted in savings to the employer
l The estimated savings is flawed in that SB 5 would not go into effect until after the expiration of any current CBA. Some unions have contracts that will not expire for up to 3 additional years. The ODAS assumes uniformity in its projections. How can this be a savings to local governments?
l There will be a Referendum where the citizens will vote in November. Once the petition is completed with the required signatures and filed, a moratorium is placed on SB 5 until voted upon.
Negative Impact on the Local Government Fund Dayton received approximately 13 million in Local Government funds in 2010 l It is unknown how much the Governor will slash the LGF but it is estimated to be 15%. This would cost the City of Dayton 1. 95 million. l Every local government would be adversely impacted by a reduction in the LGF. There would be no immediate savings of personnel costs from SB 5 l
What has public employers stated about collective bargaining? l The threat of binding arbitration places management at an unfair disadvantage. l Employers can not afford the agreements they are saddled with by the Conciliator l Governor states out of state Arbitrators are giving awards to unions that the local governments are unable to pay for
Conciliators must be from Ohio ORC 4117. 14 (G)(13) l Conciliators must take into consideration certain criteria before making an award such as comparable work performed in the private sector, interests and welfare of the public, ability of the public employer to finance and effect of adjustments on the normal standard of public service. l
Response to criticism of collective bargaining Mediation has proven to be more economical and efficient means of settling disputes in the private and public sectors l Most public sector negotiations never reach Binding Conciliation. l From 2008 -2010 there were 4394 contracts negotiated. l Of the 4394 contracts negotiated, only 385 (8. 8%) went to Fact Finding and 69 (1. 6%) went to Binding Arbitration l
l Of the cases that went to arbitration and involved healthcare premiums, Arbitrators ruled for the employer an average of 82. 6% of the time from 20082010 l Of the cases that went to arbitration and involved wage adjustments, Arbitrators awarded an average wage increase of 2. 8% from 2008 -2010
Why the need for Binding Arbitration l l l Public safety is prohibited from striking Prior to collective bargaining labor strife was common in Ohio In 1972, Ohio tied for 4 th in the nation for strikes by safety forces In 1973, Ohio rose to 2 nd in strikes by safety forces From 1976 -1979, Ohio led the nation in safety forces strikes In 1980, Ohio had 15 strikes by safety forces involving 2300 workers and costing 6800 working days
l Prohibiting strikes will not assure they will not occur l Police and Firefighters are professions where you have no private sector comparables l Over the past decade the average yearly deaths for police is 163, average yearly assaults 58, 821, average injuries is 16, 041
What is the biggest change in collective bargaining l Current procedure under ORC 4117 l l l Notice given to SERB 60 days in advance of expiration of current CBA Parties exchange proposals Tentative agreements Continued negotiation on issues not resolved If at an Impasse, Mediator can be used If Mediator is unsuccessful, proceeds to Fact Finding
l Fact Finder is selected using “alternate striking” l Fact Finder receives written and oral presentation on proposals submitted l After reviewing all evidence presented, Fact Finder issues an Award l Fact Finder decides on an issue by issue basis
l Fact Finder can select either sides proposals or choose his/her own recommendation l Upon receipt of the Award both sides review and the vote to accept or reject Award l Requires 3/5 of the total membership or legislative body to reject Award
If Fact Finder’s report is rejected, it proceeds to Conciliation, often called binding arbitration l Each side presents their last “best offer” to the Conciliator. The Conciliator has to select on an issue by issue basis either sides proposal. He/she can’t make recommendations as can the Fact Finder l Forces both sides to be realistic in last best offer l
New provision of SB 5 l SB 5 keeps the same basic procedure with some changes up to Conciliation l SB 5 eliminates the third party neutral Conciliator l The legislative body of the public employer then becomes the Conciliator l The legislative body is in essence one of the two parties to the proceeding
SB 5 creates a system where management is one of the parties at the table negotiating the contract but then has the final say on which proposal to take. l Removes any incentive of the employer to bargain in good faith l Basically turns negotiation into just a conversation because union has no leverage at all. This will contribute to a rapid lowering of morale, coupled with dwindling numbers of officers due to local government funds being cut equals a situation of unparalleled stress on public safety personnel. l