Five city unions agreed to smaller-than-budgeted raises for the next two years in recognition of the worsening economic climate.
Schenectady had budgeted to give them 3 percent raises in the new contract to be approved this year.
But all five unions, the largest of which is CSEA, agreed to take 2 percent raises instead in 2009 and 2010, with a deal to reopen negotiations for higher raises in 2011 if circumstances change.
“We told them, ‘We can’t pay you 3 percent in the current economic climate,’ ” negotiating consultant John Paolino said.
Late last week, after four months of negotiations, the last of the five unions agreed to the new contracts. The raises will cost the city $327,000, which is $163,000 less than the city had budgeted. CSEA, Operating Engineers, Carpenters, Electricians and Painters all agreed to the contract. The Schenectady City Council approved it in committee Monday.
Both Paolino and Finance Commissioner Ismat Alam admitted to some astonishment at the unions’ cooperation.
“They were willing to work with us,” Paolino said. “It was just fantastic. It was one of the best negotiations I’ve ever been in.”
Alam added that union workers repeatedly asked her to reassure them that there would be no layoffs. When they were assured that no one would be cut, they all breathed a sigh of relief, she said. That fear — and the city’s honesty about its finances — may have driven both sides to cooperate, Alam said.
“It was more like a discussion around the table than a negotiation,” she said. “There wasn’t an us-versus-them mentality.”
The unions also agreed to significantly reduce benefits for new employees, including any who started after Dec. 31, 2008.
They will no longer be able to save up to 10 weeks of vacation to cash out when they retire, a tradition that costs the city hundreds of thousands of dollars every year. New employees will be able to save up to six weeks over the course of their career.
They will also only be able to save up to 25 percent of their sick days — down from 75 percent for some current employees — and they can only use it after retirement to pay their first year of medical premiums.
Paolino said he wanted to allow employees to save some sick days as incentive to not use them.
The city will also not reimburse new employees for Medicare Part B, which now costs Schenectady $400,000 a year.
“This is a real reduction and a genuine future cost reduction for the city,” Paolino said, though he acknowledged it will be many years before the city achieves the savings, since all come into effect when this year’s new employees retire.
“When will that be? Well, I can tell you this: It will happen sometime,” Paolino said. “The day’s going to come when we’re no longer paying these big payouts.”
Union members also agreed to a major change in overtime for police dispatchers. (Dispatchers are not part of the Police Benevolent Association.)
If a dispatcher calls in sick after working an overtime shift, the overtime pay will be lost. The shift will be paid at straight time instead.
“We’re trying to eliminate someone from saying, ‘I got my overtime so I’m going to bang in sick tomorrow,’ ” Paolino said. “It’s just an attempt to better control the overtime.”
Dispatchers will get one warning — the first time they call in sick after an overtime shift, they won’t lose their overtime pay. But if they do it again in a six-month period, the pay will be lost, according to the new contract.
Several small changes were also made for fairness between various small unions.
“We’re trying to put together contracts so people working next to each other are getting the same benefits,” Paolino said.
Some employees were paid less than others to carry a beeper at all times. Some were also paid a smaller shift differential than others for working the overnight hours. Now everyone gets the same amount for those tasks.
In addition, supervisors of those who get a steel-toed boot allowance will also get the allowance. It’s $125 per year.
All of the changes add up to about an $11,000 additional cost to the city.
Paolino is now gearing up for the two major union negotiations: police and fire.
The police negotiations will begin “any day now” and the fire union will head to the table in June. While the two contracts are very different, arbitrators generally consider them comparable and award raises to police based on the raises offered to firefighters. That means that if this year’s negotiations with police fail, as they did last year, the city may be forced to duplicate whatever it agreed to give the firefighters.
The city tried to argue last year that if police were to get the same 4 percent raises that the firefighters got, they should at least have to agree to the same givebacks as the firefighters, who now pay some of their health insurance. That proposal was rejected. The police were awarded the raises without any givebacks, but only for two years — a time frame that had already expired by the time the decision was announced last year.