Nonunion workers get new benefits package, is this a message to the unions?

Updated: To include response from union leaders

In a move that is sure to heat up negotiations with the city’s unionized workforce, the Nutter administration announced today that new labor terms go into effect Monday for nonunion civil-service workers and other exempt employees.

The changes include a 2.5 percent wage increase, significant increases to employee contributions toward pension and health-care costs and the possibility of furloughs.

City budget director Rebecca Rhynhart said the package affects 5,500 city workers and would cost the city $17 million over five years. That figure doesn’t include money that could be saved from furloughs.

Employee contributions to the pension fund will increase by about 1.5 percent of salary. Healthcare contributions will more than triple going from $42 a month under a family plan to $141 and for a single employee $14 a month to $49.

A similar package was offered to AFSCME District Councils 33 and 47, which represent 12,400 blue-and white-collar workers who have been without a contract since 2009, said Everett Gillison, Mayor Nutter’s chief of staff. The city and the unions have met continuously over the years, with increasing frequency recently, but they remain at a stalemate.

“I remain hopeful that we can conclude negotiations,” said Mayor Nutter, during a news conference in City Hall today. He added that he wants fair multiyear contracts that includes changes to work rules, pensions and healthcare.

But union leaders argue that Nutter’s package is a pay cut.

“[It] is a pay and benefit cut for the vast majority of city employees. For some it is a massive pay cut,” stated Cathy Scott president of DC 47, noting the increased employee contributions.  “It is not something we would negotiate.  It is not something we would accept.”

The announcement comes on the heels of news that DC 33 members will have to dole out $50 a paycheck for health benefits starting in November — the first time they will have to contribute toward their health care.

DC 33 president Pete Matthews said Nutter’s announcement was an attempt to cause uproar within the unions.

“The Mayor has done this to cause aggravation in the union. He’s using his spin,” Matthews said. “It’s not going to work on us.”

So is the city trying to send the unions a message?

“I think it’s certainly a strong statement by the administration of where it would like the city to be in terms of collective bargaining that needs to be done,” said Sam Katz, Board Chairman of the Pennsylvania Intergovernmental Cooperation Authority (PICA). Is it a message that will move labor (unions)? I’m dubious.”

The administration says they are simply providing a raise to nonunion workers who have worked without one since 2007.

“The message we’re trying to send here is that the people who have waited and have given, it’s time to move on, at least with them” Gillison said. “If 47 and 33 takes anything from that then that’s what they can [do.]”

“We’re not just going to wait anymore,” he said.

Councilman Wilson Goode Jr. expects that the announcement will cause quite a stir. 

“Having nonunion workers work in conjunction with union workers when nonunion workers get raises and union workers are not, it will cause a major issue,” he said.