Contract bargaining season is almost upon us, as guest speaker Micki Callahan, Director of San Francisco’s Department of Human Resources (DHS), reminded us at the September Public Employee Committee (PEC) meeting. The PEC is a coalition of all San Francisco public unions. By providing a forum for public sector unions to come together to share information, the PEC increases strategic member strength and unity in San Francisco.
Ms. Callahan introduced Suzanne Mason, DHR’s new Employee Relations Director, and talked about the current supplemental COLA controversy. Ms. Callahan announced the City’s interest in exploring contract extensions with raises as an alternative to full contract negotiations. Negotiations will be starting in January and Local 21 will be selecting our Bargaining Team to join with Local 21’s professional negotiators at the bargaining table.
Suzanne Mason, the new Employee Relations Director, has worked in municipal government for 32 years. She spent 25 years as the Director of Human Resources in Long Beach, California. “I have a foundation of mutual respect with labor relations,” she said to PEC. Ms. Mason stated that she prefers “collaborating, not fighting” and looks forward to finding “mutual and positive solutions to problems.”
The Supplemental COLA
After introducing Ms. Mason, Ms. Callahan spoke about the City’s position on the ongoing struggle over extending the supplemental COLA to pre-1996 retirees.
The supplemental COLA was originally triggered whenever the SFERS’ fund performance exceeded its expected earnings and there were sufficient earnings to fund the supplemental COLA.
In 2011, in order to keep the Pension Plan viable, difficult decisions were made. Unions joined together to support a pension reform plan that would be effective, but also equitable to all stakeholders. The result was Proposition C, which proportionately spread the cost of the reform between workers actively paying into the pension fund, retired workers, and the City. Retirees who had formerly been eligible for a supplemental cost of living adjustment (COLA) in addition to the basic COLA got reduced access to the supplemental COLA as a result of Prop C, while active workers and the City were required to contribute a higher percentage towards the fund.
Once Proposition C was enacted, supplemental COLAs were granted only if the fund’s performance exceeded its expected earnings and SFERS was fully funded based on the market value of assets. The decision to eliminate the supplemental COLA was challenged in court, and it was eventually ruled that only workers who retired after November of 1996 would continue to have access to the supplemental COLA. Those workers were found to have a vested right to the supplemental COLA, because they retired after the supplemental COLA was offered and had full expectation of that benefit.
Now, the group of pre-1996 retirees are fighting to have their access to the supplemental COLA restored as well. The Retirement Board has taken steps to extend the supplemental COLA to this group of retirees, and the City believes the retirement board does not have the legal authority. The City will challenge any effort by the Retirement Board to extend the supplemental COLA to pre-1996 retirees. Ms. Callahan made it clear that the cost of extending the supplemental COLA to pre-1996 retirees would fall squarely on the shoulders of active employees, both by extending the payment of elevated contributions and by reducing the amount of money available for negotiations.
CCSF 2017 Bargaining
Ms. Callahan also spoke about upcoming 2017 San Francisco bargaining. She suggested that unions consider consolidating their economic presentations and videotaping it, thereby saving time and cost.
Ms. Callahan also discussed the possibility of potentially extending current Collective Bargaining Agreements with salary increases for a period of 1 or 2 years. An extension would mean that unions would agree to raises in exchange for not bringing a list of proposals to the table and taking months to negotiate over them. No specifics were discussed, and each union will bring the extension possibility back to its leadership for consideration.
An extension could potentially benefit all sides, by saving time and effort for a resource- strapped DHR and City Attorney’s Office, and by allowing unions to get raises without having to trade anything away in the process. In the meantime, Local 21 will continue to make preparations as though full bargaining will be occurring. Local 21 Executive Director Bob Muscat, who chairs the PEC, suggested to all the assembled unions, “This is another occasion where working together might be in our members’ interest and drive better results.” The PEC will be following up with individual unions to explore support for an extension and tighter coordination going forward. Within our own union, Local 21 will take steps to measure our leadership and membership’s interest in an extension.