The unions have all the leverage. They can continue working until Dayton offers them a contract even better than the ever-increasing pay and benefits they currently receive.
The tentative contract agreements negotiated by Gov. Mark Dayton with the state's two largest unions are representative of the problem today in state government: protecting the status quo and asking Minnesota taxpayers to pay more for it.
Members of AFSCME and MAPE have been working for the past year and a half without a new contract. That wasn't a problem for their members. The current contract, which includes a $43 million increase for built-in autopilot pay increases and free health insurance for state employees, remains in place until a new deal is approved.
In other words, the unions have all the leverage. They can continue working until Dayton offers them a contract even better than the ever-increasing pay and benefits they currently receive.
And that is exactly what happened. The governor agreed to a new tentative contract that provides a $59 million increase -- $13 million more than the previous contract. It includes a 2 percent across- the-board increase beginning in January, as well as seniority-based step increases to eligible employees.
For AFSCME, this represents a 2.75 percent increase in fiscal year 2012 and a 4.75 percent biennial increase over the base in fiscal year 2013. For MAPE, it totals a 3.5 percent increase in fiscal year 2012 and a 5.5 percent biennial increase over the base in fiscal year 2013. And remember, in government, the "base" is a projection of future spending, so the real percentage increases are even greater when compared with actual compensation the year before.
And it gets worse. Along with the salary increase, the unions and Dayton also maintain what can only be described as free taxpayer-paid health insurance for their members.
Some 50,000 state employees do not pay a dime for the premium on their generous state health insurance policy. State employees who opt for dependent coverage pay roughly $130 a month in total to fully cover their families.
While private-sector workers, if their employers even offer health insurance benefits, on average pay 25 percent to 50 percent of their monthly insurance premiums in addition to the usual copays and deductibles, state employees contribute nothing for their premiums. It costs taxpayers nearly one-half billion dollars per biennium to provide these 50,000 enrolled workers with fully paid health insurance premiums.
SEGIP, the state insurance plan, forecasts a premium cost increase of 9 percent in 2013. By agreeing to this contract, Dayton has said taxpayers will entirely cover that increase rather than asking state employees to pay a share.
The new contract also ignores substantial pay-for-performance reforms approved by the Legislature in 2011 and 2012. The governor preserved the status quo of rewarding employees for length of service with virtually automatic "step" increases as a proxy for employee value and performance.
After a year and a half of negotiations, we expected something more from the governor's office. Having state employees pay some of their health insurance premiums like everyone else is far from unreasonable. So is asking for pay increases to be based on performance. Yet when the deal was done, all we found in the negotiation was the status quo of salary increases, seniority-based pay and continued free health insurance. This is a huge lost opportunity.
Minnesotans should recognize that they are being asked to pay more for an unacceptable status quo and urge Gov. Dayton to renegotiate the new contract.
Mike Benson (Rochester), Keith Downey (Edina) and Steve Drazkowski (Mazeppa) are Republicans in the Minnesota House serving on the Employee Relations Subcommittee of the Legislative Coordinating Commission.
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