Would also make changes to health care plan
By Eric Boehm | PA Independent
HARRISBURG — In a new contract proposal with Pennsylvania’s main government workers’ union, the Corbett Administration is proposing a 4 percent pay cut and changes to health benefits.
With the state facing an operating budget deficit of more than $4 billion next year, Gov. Tom Corbett asked Council 13 of the American Federation of State, County and Municipal Workers (AFSCME), which represents about 45,000 state employees, to roll back a 4 percent pay increase which took effect last October. The pay cut would be made up with a 2 percent increase in July 2012 and July 2013.
The Corbett Administration is in the process of negotiating new contracts with government workers as the current contracts expire on June 30.
Changes in health benefits proposed by Corbett would include changes to employee contributions to health plans and a new benefit structure for new employees.
In the proposal, the administration said the cutbacks were “consistent with the need to achieve significant cost-savings.”
The average AFSCME Council 13 employee makes a $39,000 salary with an additional $22,000 in annual benefits, according to the state Department of Administration. The 4 percent pay cut would amount to a $1,500 decrease in annual salary for the average worker.
AFSCME Council 13 employees received pay raises of 3 percent in 2008 and 2009, in addition to the 4 percent pay increase in October 2010.
Non-unionized government employees in Pennsylvania have been subject to a pay freeze since 2008.
The governor’s office did not return calls for comment on the proposal.
Dan Egan, spokesperson for the state Department of Administration, which handles employee operations and human resources for government workers, said the proposal was far from a final product.
“As far as the proposal or the negotiations themselves are progressing, we’re not commenting on those things publicly,” said Egan. “The proposal is just that, a proposal. We’re continuing to negotiate with them.”
Corbett’s office did not return requests for estimates on overall savings.
The next official meeting between union representatives and the administration is scheduled for April 22.
Egan he could not comment on the status of the negotiations but acknowledged that having future meetings planned was a good sign.
David Fillman, executive director of AFSCME Council 13, also expressed optimism about the upcoming negotiations, despite the changes proposed by the administration.
“This is an initial proposal, and we’d be more concerned about this being on the table on June 30,” said Fillman.
The proposal indicates the Corbett Administration wants to change the contribution structure of government employee health plans. Instead of being based on pay, the employee contributions would be based on a premium structure, the way many health plans in the private sector operate.
Government employees currently contribute 3 percent of their salary towards their health care, which is a self-insured fund managed by a board of nine union employees and nine managerial level employees.
The specific benefits afforded by the health care trust fund are not subject to collective bargaining and can only be changed by the trustees.
The administration also indicated it wants to establish different health benefit entitlements for employees hired after July 1 and create a new base medical plan which is less costly.
The proposed health care changes would place a limit on how long retired employees could receive health benefits, though the plan is not specific about what those limits would be or who they would apply to.
Currently, unionized state workers receive health benefits for life after retirement if they continue to pay into the system.
Fillman said there were not enough details on the proposed health plan changes to say whether the union would be supportive, though he warned the changes could make the 4 percent pay cut even more difficult for workers to deal with.
