DCTU stung by Portland proposal to hike non-union wages up to 26 percent

Union members at the City of Portland are seething after hearing that the City Council is considering raising salaries of managers and non-represented personnel by as much as 26 percent. A council work session to discuss the proposal was held Thursday, Jan. 31 (after this issue went to press).

The Executive Board of the American Federation of State, County and Municipal Employees Local 189 - the largest of seven unions that compose the District Council of Trade Unions (DCTU), which bargains jointly with the city - called the proposed raises "outlandish." It expressed shock that commissioners would even consider such an idea given the present economic climate. Members have started a postcard campaign to oppose it.

Last fall the DCTU was engaged in protracted contract negotiations that eventually led to a five-hour strike before a mediated settlement that provided only cost-of-living pay raises - and, for the first time, employee co-payments for health insurance.

"Four months ago city leaders chastised, flogged and belittled union leaders for asking for a modest raise during contract negotiations," said James Hester, a member of and spokesperson for Local 189. "City leaders even went so far as to imply union members were unpatriotic for requesting raises given the events of Sept. 11. We ended up with a 2.9 percent cost of living increase - and now they want a 26 percent raise?"

Hester said city managers and unrepresented employees already receive annual adjustments and cost-of-living increases. He said market surveys the city is using to justify the wage hikes are "extremely subjective," and Local 189 challenged the process for justifying them.

The DCTU emphasized that the proposal was prepared by the very same people who will benefit the most - upper management. The raises will also set up management for substantial raises in the future that will dramatically increase their retirement benefits, Hester said.

Most troubling to the DCTU was news that Yvonne Deckard, director of the city's Bureau of Human Resources, is in line for a 26 percent raise - reportedly from $97,344 to $123,552 a year. Deckard was the city's point person in telling the DCTU, the media and the public that Portland "couldn't afford" salary increases for its workers, reported the AFSCME Alert newsletter.

"There's a recession on and a crisis in the health plan at the city; there are lots of places to spend money right now, rather than giving raises beyond cost-of-living to the highest-paid people in the city," said Jim McEchron, business manager of Laborers Local 483, the second-largest member of the DCTU.

Oregon has the highest unemployment rate in the nation at 7.5 percent and health insurance costs are rising at double-digit rates. Both are compelling reasons to reject the proposed raises, the DCTU said.

According to Local 189, city employees face significant threats to their jobs because of the current economic climate. "Possibly 150 to 200 employees from the Police Bureau and another 40 to 50 at the Water Bureau could be laid off," Hester said.

As part of last fall's collective bargaining agreement, the DCTU and city agreed to redesign the self-insured health plan in an effort to save the plan money and to reduce employee co-payments. Their goal was for a 25 percent reduction, with the minimum set at 19 percent.

Last week the DCTU presented the city with a proposal to reduce the health plan by 25 percent. However, the city rejected it because it didn't contain an "opt-out" provision.

Management is insisting that employees with spousal coverage be permitted to opt-out of the city's insurance plan. Employees would receive a cash rebate based on a percentage of the premium savings. The balance would go either to the general fund or back into the bureau's operating fund.

The DCTU says any savings should be plowed back in to the health fund, which has low reserves.

"By their own estimates, the city wants to loot the health fund of $2 million," said McEchron. "If they go there, they won't go with us (DCTU)."

More negotiations were held Tuesday and Thursday (after this issue went to press). If a compromise isn't reached, the city could unilaterally implement the plan with its opt-out provision.

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