And
City
of
Interest
Arbitration
Arbitrator: George Lehleitner
Date
Issued:
Arbitrator: Lehleitner; George
Case #: 06236-I-86-00141
Employer:
City of
Date Issued:
IN THE MATTER OF INTEREST ) OPINION
AND AWARD
ARBITRATION ) OF
BETWEEN ) GEORGE
LEHLEITNER
)
CITY OF
AND )
LOCAL 828 )
HEARING:
INTEREST George
Lehleitner
ARBITRATOR: 3348
REPRESENTING THE CITY:
C. Akin Blitz,
Attorney at Law
REPRESENTING THE
Michael
Tedesco, Attorney at Law
INTRODUCTION
The undersigned was selected as the neutral interest
arbitrator
by the
and
the City of
pursuant
to RCW 41.56.030(6) and RCW 41.56.450, et seq.
At
the
commencement of the hearing, both parties formally waived
their
statutory right to appoint advocate arbitrators and
agreed
the neutral arbitrator was authorized to decide the
case
in place of a full arbitration panel.
Hearings were held on
1986. The first hearing day
was devoted to settlement discus-
sions between the parties. As a result of these
discussions,
the
parties were able to resolve all issues except wages (base
wage
rates and EMT incentive pay) plus insurance. The second day
was
devoted to a full hearing on these remaining issues.
The City was represented by C. Akin Blitz, Attorney at Law,
and
the
were
given a full opportunity to make presentations on each
issue
in dispute and to examine and cross-examine witnesses, as
necessary.
In addition to the verbal and documentary evidence,
the
arbitrator informed the parties he reserved the right to
consider
any change in the Consumer Price Index (CPI), which
occurs
between the date of hearing and the issuance of his award.
Neither party objected. The
hearing was closed at the conclusion
of
the evidentiary phase on
_____
1 Shortly after the hearing on
requested some additional time in
which to render his award. Both
parties agreed. The arbitrator
appreciates the cooperation of
the parties in this matter.
_____
Issue #1 -- Wages and EMT Pay
a
negotiated salary schedule. For 1985 (
December 31, 1985), a top step
fire fighter (Step E) earns
$2,309.00
per month. Proportionately higher salaries are paid
to
driver operators, mechanic specialists, fire inspectors and
lieutenants.
A. The
The
increases
in the first year of five percent (5%) and in the
second
year of seven percent (7%). The
that
throughout the contract period EMT pay shall be four and
three-quarters
percent (4.75%) above the relevant classification.
All wage adjustments proposed
by the
The
1) The cost of the
The
the first
year to be $89,786.00 or 7.37% above last year's pay-
roll
costs. The cost in the second year is $79,652.00 or 6.13%
above
the previous year's costs. These costs are modest and
well
within the City's financial ability.
2) The relationship between wage adjustments and the
premiums
paid for EMT work is important in
fire
fighters in this City do an extraordinary amount of EMT
work
and should be compensated accordingly.
However, while
selective
adjustments for EMT work are appropriate, the arbi-
trator must be careful not to create separate
classifications,
as
proposed by the City, because this would create a potential
dispute
about trade time. The trade time issue has already
been
resolved.
3) Unfortunately, audited budget figures for 1985 are
not
available. However, the figures through 1984 indicate the
City has successfully built up
its ending fund balances from a
negative
amount in 1982 to $439,925.00 in 1984. Viewed in a
different
way, the ending balance for 1984 represents a healthy
4.25% of total revenue and the
unaudited figures for 1985 indi-
cate this will rise to approximately 6.5%.
4) Moreover,
nues and overbudgeted
expenditures. While this is sound fiscal
policy,
it also means the City has more funds available to pay
reasonable
wage adjustments than the budget documents suggest.
5) In sum, combined reserves, both in the capital projects
fund
and the general fund, show available reserves increasing
from
$43,802.00 in 1982 to $522,296.00 at the end of 1984. This
should
increase to approximately $800,00.00 by the end of 1985.
6) The
ing comparator departments:
Mount
historically
used by the City and the fire fighters. These
comparators
should be utilized by the arbitrator, rather than
the
"results oriented" comparators offered by the City for
numerous
reasons. First, these are the comparators historically
utilized
by the parties. The City, on the other hand, created a
list
of comparables for this arbitration. The City's proposed
comparators
were never mentioned at the bargaining table. Second the
negotiations. Now, the City wants to change the ground
rules
mid
stream. Third, the City's contention that the
parables
are inappropriate because they are located within the greater
Seattle/Tacoma area is
incorrect. Six (6) of the
parators (
and
in
fact none, with the exception of
city
. In this regard, if the arbitrator were
going to utilize
a
sixty (60) mile radius as the benchmark for developing com-
parator jurisdictions, as the City suggests, he would
have to
consider
satellite communities surrounding
the
comparable departments proposed by the City are smaller
departments
with numerous volunteers protecting largely rural
areas.
Thus, they not appropriately used for legitimate wage
comparison
purposes. Moreover,
less
hours than those in
parisons between these departments should be
adjusted to reflect
hourly
wage rates.
7) A comparison of wage rates among the benchmark
cities,
as of January, 1986, against current (January, 1985)
wage
rates in
following:
__________
Top Step
Fire Fighter
Bellingham 2,405
Bermerton 2,369
Renton 2,704
Edmonds 2,511
Olympia 2,541
Everett 2,808
Mercen Island 2,537
Aberdeen 2,342
Lynnwood 2,500
Port Angeles 2,437
Mount Lake Terrace 2,280
Kent 2,619
Vancouver 2,460
Auburn 2,585
Average 2,508
Longview 2,309
Variation 9.2%
__________
These comparisons show that a base
increase of 9.2% is needed
to
bring Longview in line with the average paid by the compara-
tor cities. The Union's proposed wage
adjustment, while it
will
not achieve the goal of parity with these departments, is
needed
to at least make Longview wage rates more competitive.
The Union's wage comparisons
further reveal that, when EMT
premiums
are factored in, Longview is still approximately 9.1%
below
average.
8) Another significant factor is the number of hours worked
in
Longview, as distinguished from hours worked by fire fighters
in
the comparator departments. More specifically, Longview
fire
fighters work 51.30 hours a week, as compared with an aver-
age
of 49.23 hours in the comparator departments. This exacer-
bates
the negative wage differential between Longview and the
comparator
departments.
9) Wage increases in the comparator cities for 1985-86
averaged
3.93%. This should be reflected in the wage adjustment
awarded
by the arbitrator.
10) Viewed in a slightly different way, Longview ranks
second
to last in monthly top step fire fighter wage rates
among
the comparator cities and dead last in hourly rates.
Clearly, a substantial effort
to make Longview fire fighter wage
rates
more competitive has to be made.
11) Other employees in Longview enjoy more competitive
wage
rates than the fire fighters For
example, classifications
like
senior clerk, utility worker, water plant operator,
mechanic,
secretary, engineer, accountant, equipment operator,
general
clerical, building inspector and even fire chief are
all
paid more competitively than fire fighters.
12) Admittedly, the Longview area has suffered economically
in
recent years, largely as a result of problems in the timber
industry.
However, things have improved substantially since 1982.
More specifically, since 1981,
taxable services have increased
by
20.6%, contracting by 7.6%, manufacturing by 22.6%, transpor-
tation and utilities by 85.31%, wholesaling by
35.5%, finance
by
41.6% and retail sales by 22.5%. These all indicate an econ-
omy on the rebound. Moreover, the downturn in
the population
has
almost stabilized.
13) As indicated previously, EMT pay is an important
issue
in Longview. Longview has seen a
dramatic
increase
in EMT runs in recent years (i.e., from 19 aid runs
in
1976 to 1069 in 1985). The arbitrator's award should recog-
nize and reward the amount of work done by these
EMTs.
14) The City's attempt to
use a "weighted average" in com-
paring
Longview fire fighter salaries to those paid by other
departments
is invalid because it results in an apples and
oranges
type comparison. Obviously, the only valid comparisons
are
based on "likes", i.e., top step fire fighter to top step
fire
fighter.
15) The City's exhibits compare Longview to the compara-
tor cities as of December, 1985. If January,
1986 wage
increases
are factored in, these comparisons change dramati-
cally and, in fact, justify a wage increase along
the lines
proposed
by the Union. More specifically, the average wage
settlement
among the comparator departments for 1986 was 3.37%.
16) The City offers a number of so-called "timber
cities"
as a
backup list of comparables. This is clearly a "results
oriented"
list, as evidenced by the obvious exclusion of such
cities
as Medford and Eugene, Oregon, and Redding, California.
17) Fire fighters in Washington have settled in the 4%
range,
despite lower CPI figures. If Longview is going to be
competitive,
it must pay at least as much.
18) Internal parity arguments are not convincing because
many,
if not most, of the employees in Longview are unrepresented
for
purposes of collective bargaining.
B. The City
The City is proposing a two (2) year agreement with a one
and
one-half percent (1.5%) increase effective May 1, 1986, and
an
additional two and one-half percent (2.5%) increase on
January 1, 1987. The City also
proposes a selective $40.00
per
month EMT increase to be accomplished by expanding the
current
five (5) bargaining unit classifications to ten (10)
classifications.
The new classifications would be the same as
the
existing classifications, but would consist of those
fire
fighters with the EMT certification, all of whom would
receive
the additional stipend. Finally, the City is willing
to
pay longevity increases, as proposed by the Union.
The City's arguments are summarized as follows:
1) The Union's references to fund balances in the capital
projects
account are misleading With the
exception of revenue
sharing,
these are all dedicated for specific projects and
thus
are not available for wage adjustments.
Revenue sharing
is
properly treated as a one-time revenue source.
2) The ending fund balances cited by the Union are like-
wise
misleading. The City, because it found itself in an intol-
erable financial situation (i.e., negative cash
balances),
imposed a
local option sales tax in 1983. Even after imposing
this
tax and cutting back on expenditures, the City had a nega-
tive balance for five (5) months in 1984. And
while there was
only
one (1) month with a negative balance in 1985, there have
already
been three (3) in 1986. If current projections hold,
there
will be a net deficit of $286,335.00 at the end of 1986.
3) The City Council is currently taxing at the maximum
amount
(sales tax and property tax) . The only option left for
the
City is to hold down expenditures and attempt to promote
economic
growth. Under these circumstances, the City is not
in a
position to pay more than it has offered to the fire
fighters.
4) The City has not underbudgeted revenues. In 1987,
the
City has budgeted only $100,000.00 in excess of expendi-
tures, as opposed to $200,000.00 in the previous
year. In
1988, the City expects a
sizeable amount of underbudgeted
expenditures
with no revenues to offset (i.e.1 "the mayor's
$800,000.00
problem"). This is but another indication of the
serious
financial problems the City is facing.
5) Because of financial
difficulties, the City has had
to
reduce its work force over the years. In fact, since 1982,
the
City's work force has declined from 310 employees to 299
and a
further drop to 290 is projected for 1987.
6) Another indication of
the City's fiscal problems is
noted
in the August 25, 1986, financial report by Moody, giving
the
City an A rating. The report notes that "continued economic
problems
are of concern." Also identified by the Moody report
are a
declining population and sharply increased tax rates.
7) The LGPI data offered
by the Union purporting to
compare
like classifications in Longview to those in other
cities
is not a meaningful comparison because there are too
many
variations in job duties.
8) The comparators
offered by the Union are not appro-
priate for many reasons. First, the bargaining
history
between
the parties does not, as the Union suggests, demon-
strate historical reliance on the comparables
proposed by the
Union.
In this regard, this City has never before gone to
interest
arbitration and, in fact, has never prior to these
negotiations
used a professional negotiator. And while the
so-called
benchmark cities now proposed by the Union
have
been mentioned in previous negotiations, the City
has
never agreed to base Longview wage rates on wages paid
by
these cities. To the contrary, since 1972, the cost of
living
and the City's financial condition have been the primary
determinants
of fire fighter wage rates in Longview and wage
comparisons
with the so-called benchmark cities were largely
ignored
by both sides. Moreover, since 1979, when Longview
experienced a
downturn, as against the more stable economy in
the
Puget Sound area, the City expressly declined to rely on
the
so-called benchmark cities, as proposed by the fire fighters
Second, whatever relevance the
so-called benchmark cities may
have
had in 1972 has long since disappeared. Simply stated,
these
benchmark cities, which are predominantly located in the
Puget Sound area, are experiencing
a robust economy, as distin-
guished from the Longview area, which is
economically depressed.
Moreover, these Puget Sound
cities are not demographically simi-
lar to Longview because they exist in an
entirely different
labor
market. The so-called benchmark cities are primarily
satellite
cities of Seattle/Tacoma and thus are part of the
higher
cost of living associated with those metropolitan
areas.
Longview, on the other hand, is not located near a
major
metropolitan area and is suffering the effects of a
severe
downturn in the timber economy. Third, a review of the
benchmark
cities proposed by the Union reveals significant
differences
between Longview and the other jurisdictions.
For
instance,
Longview is substantially below average in per capita
income
and is toward the bottom of the list in size. For all
of
these reasons, it is clear that the so-called benchmark
cities
are not appropriate comparators.
9) The comparators offered by the City are appropriate
and
should be utilized by the arbitrator. They are drawn from
the
local labor market in which Longview operates and are com-
prised of demographically similar departments
(i.e., similar amount of
property
protected, similar size and number of incidents, etc.).
More specifically, the list of
primary comparators offered by
the
City were derived by selecting demographically similar
Washington
departments within a sixty (60) mile radius of Longview.
As a practical matter, many of
these departments have mutual aid
pacts
with Longview and are protecting the same property.
10) In comparing Longview wage rates with those paid by
the
comparator departments, the City has utilized a weighted
average
approach. This is done for historical reasons. More
specifically,
Longview, unlike many of the comparator depart
ments, has created a separate, higher paid
classification for
driver
operators. Thus, it is logical when comparing top step
fire
fighter wages to factor in (i.e., develop a weighted
average)
the higher wages paid to drivers. The City's pri-
mary comparators reveal the following:
__________
TOP STEP FIRE FIGHTER
POSITIONS
(Weighted Average)
AS OF 12-31-85
(WTD AVERAGE) % OF
CITY - DISTRICT TOP STEP LONGVIEW
Camas 2289 96.3
Centralia 2072 87.2
Chehalis 2070 87.1
Kelso Co. #2 2000 84.2
Clark Co. #4 2315 97.4
Clark Co. #5 2367 99.6
Clark Co. #6 2285 96.2
Olympia 2397 100.9
Vancouver 2228 98.0
Average 2236
2 94.1
Longview 2375 100.0
_____
2 The Union also produced a chart showing
wage rates for top
step fire fighters among the City's
proposed comparators in 1985
and 1986. The Union's figures do not
dovetail with the City's
figures because the Union, unlike the
City, did not use the
weighted average approach. More
specifically, the 1985 average
in the Union's chart for top step fire
fighter (excluding Long-
view) is 2201, as compared with the
City's figure of 2236.
__________
A comparison of EMT premiums
among these same departments shows
that
Longview pays an additional $40.00, as against an average
of
$28.05 paid by the comparator departments. Clearly, these
comparisons
show that, as to both base wage rates and EMT pay,
Longview is extremely competive.
11) The City is also
proposing a secondary set of com-
parables
in the event the arbitrator chooses not to adopt a
labor
market approach. Clearly, Longview is a lumber intensive
community,
which has seen its economy rise or fall with this
industry.
Other lumber intensive communities on the west coast
are
as follows:
__________
LUMBER INTENSIVE COMMUNITIES -
WEST COAST (as of 12/85)
WTD
AVERAGE
Aberdeen, WA 2381
Albany, OR 1995
Coos Bay, OR 1818
Klamath Falls, OR 1928
Hoquiam, WA 1883
Springfield, OR 1977
Roseburg, OR 2067
Port Angeles, WA 2389
Eureka, CA (25,000 pop.) 1932
Average 2041
Longview, WA 2377
+16.5%
__________
Again, these comparisons
clearly show the competitive wage paid
by
Longview to its fire fighters.
12) The factor of internal parity supports the City's
position.
Historically, fire fighter wage adjustments have
paralleled
those paid to other City employees. The City's
offer
is consistent with wage adjustments already agreed to by
other
City employees.
13) The cost of living, as measured by the Portland Con-
sumer Price Index (CPI) has been the primary
determinant of Long-
view
fire fighter wage rates in recent years. For instance,
1985 wage adjustments were
calculated by taking 80% of the
Portland
CPI-U (September, 1983 through September, 1984). A
review
of the relevant CPI data clearly supports the City's
wage
proposal. More specifically, the Portland CPI-U has declined
steadily
through 1986 and, as of November, 1986, stood at only
0.3% over the figure for
November, 1985.
14) From 1982 to the present, fire fighters have enjoyed
slightly
larger wage increases than other City employees (24.5%
for
fire fighters, as opposed to 22% for other City employees).
However, the evidence does not
support a finding that fire
fighter
wage adjustments in Longview have been driven by wage
adjustments
paid by the so-called benchmark cities.
15) It is appropriate to roll any special adjustments paid
to EMTs into their base pay as fire fighters. While it is true
that
the parties reached a tentative agreement on trade time,
it
was never the City's intention to allow fire fighters not
certified
as EMTs to trade shifts with EMT certified fire
fighters.
The City's proposal to create
separate EMT combined classifications
is
intended to restrict the ability of non EMT certified fire
fighters
to trade shifts with fire fighters who are EMT certi-
fied. This is only logical in view of the
emphasis in Long-
view
on being EMT certified and the amount of EMT activity.
The City's proposal is
designed as an incentive to either
become
or remain EMT certified.
16) Fire fighters have enjoyed wage increases in recent
years
while private sector employees in the local area have
suffered
wage freezes, rollbacks and in many cases termination
due
to lack of work. Under these circumstances, it is unreason-
able
for the fire fighters to expect a wage adjustment of the
magnitude
proposed by the Union.
17) Support for using the labor market approach to select-
mg
comparables can be found in Arbitrator Beck's award in
Bothell.
There, the arbitrator limited the relevant comparables
to
demographically similar departments in the local labor market.
See also, King County Fire
Protection District #39 (Levak, 1983).
18) The Union contends that, if comparables are to be
determined
on the basis of a sixty (60) mile radius test, demo-
graphically
similar departments within the Portland metro area
should
be included. This argument is erroneous because it fails
to
take into account the impact of a large city such as Portland
or
Seattle on wage rates of satellite communities.
C. Discussion
The Washington statute [RCW 41.56.450(a) through (f)] sets
forth
the criteria to be applied by interest arbitrators in
developing
interest awards. The arbitrator's award is based
on
an application of these criteria to the facts in this case.
What follows is a summary of
the focal points in that analysis.
The EMT Issue
Before reviewing the record in this case against the statu-
tory criteria, some preliminary comments about
the EMT issue are
in
order.
Both parties agree and the record supports a finding that
EMTs
are deserving of special consideration. Without question,
the
bulk of the increased activity in Longview is the product
of
emergency medical assistance provided by fire fighters. This
being
so, it is appropriate to recognize this additional work
by
allocating a significant portion of available funds to
the EMTs.
The dispute between the parties on the EMT issue involves those fire
fighters
who either are not certified as EMTs or who have
opted
to
let their EMT certifications lapse.
(Approximately 12 of
the
current 35 bargaining unit members do not intend to become
EMT certified or else intend to give up their EMT certificate.)
The City's proposal for
expanded EMT classifications is intended
to
restrict the ability of these non EMT certified fire fighters
to
shift trade with other fire fighters. The apparent intent
of
the City is to provide a negative incentive which will
discourage
fire fighters from giving up their EMT certifica-
tion.
The Union, on the other hand, strenuously opposes any
attempt
to use this wage proposal as a "backdoor" means of
restricting
shift trading. According to the Union, it was
never
the intention of the parties during the negotiations
that
culminated in a tentative agreement on shift trading to
limit
the ability of non EMT certified fire fighters to shift
trade
with those functioning as EMTs.
The arbitrator can understand the City's desire to
provide
strong incentives designed to have as many fire
fighters
as possible certified as EMTs. However, the City's
proposal
is likely to result in a greivance arbitration on
the
issue of shift trading, in view of previous understandings
during
the negotiations process. In the arbitrator's view, a
more
workable solution in this case is to utilize a significant
portion
of available resources to reward those fire fighters
with
EMT certification. This will, as a practical matter,
provide a
strong incentive to acquire or retain the necessary
requirements
for EMT certification without unnecessarily resur-
recting the shift trading issue.
Ability to Pay (Other Factors Traditionally Considered)
The Washington Statute, unlike its counterpart in Oregon,
does
not specifically identify ability to pay as one of the
applicable
criteria. Nevertheless, ability to pay and interest
and
welfare of the public are factors traditionally considered
by
arbitrators in fashioning interest arbitration awards.
This is as it should be
because, if the public employer really
does
not have the ability to pay a wage increase, other factors
tend
to be irrelevant.
Ability to pay is an important consideration in this case
and
one on which there appears to be a wide difference of
opinion.
Clearly, the City administration should be commended for
taking
the difficult steps needed to improve the City's balance
sheet.
Simply stated, in 1982-83, the City of Longview was
experiencing
serious financial difficulties, as evidenced by
persistent
negative cash balances requiring the City to borrow
money
at market interest rates. Since 1982, the City has taken
the
unpopular but necessary step of increasing local taxes and
has
also made a concerted effort to hold down expenditures.
The final results of the
City's fiscal policies are not yet
known
(the audited budget for 1985 was not available at the
time
of this hearing) , but the clear trend has been for the
City to gradually build up its
ending balances.
Despite the gradual improvement in the City's finances,
the
arbitrator is convinced that Longview does not have a
lot
of extra money. In this regard, the assistant city manager
indicated
that in 1987 the City has budgeted only $100,000.00
in
excess of expenditures, as opposed to $200,000.00 in the
previous
year. Moreover, Longview is facing the potential of
net
deficits at the end of 1986 and is not in a position
to
raise additional revenue at this time.
In sum, the City's financial standing has clearly improved
in
the last couple of years. Thus, it would not be correct
to
say the City is unable to pay a modest wage adjustment to
fire
fighters. However, the City's fiscal resources are
limited
and there are some potential deficit problems on the
horizon.
Under these circumstances, a conservative approach
to
fire fighter wage adjustments is dictated.
A related factor is the interest and welfare of the public.
As the City correctly points
out, Longview is a timber intensive
community
that has suffered significant economic reverses in
recent years
and has yet to recover. Moreover, because of
financial
problems, the City has had to raise taxes to the limit,
leaving
little or no room for increased taxes as another poten-
tial revenue source. Simply stated, there is a
decided relunc-
tance in this community to pay a generous
increase to fire
fighters
when so many members of the public have suffered wage
rollbacks
or a loss of employment. All of these factors suggest
a
conservative approach toward fire fighter salaries.
Comparability
The parties offered different sets of comparables. The
arbitrator
is not convinced that either set of comparators is
entirely
appropriate.
A. The Benchmark Cities
The Union proposed a list of comparator cities it calls
the
benchmark cities. According to the Union, these so-called
benchmark
cities are the comparables historically utilized by
the
parties during the negotiations process. Eight (8) of
the
Union's fifteen (15) proposed comparator cities are in
the
Puget Sound area near Seattle/Tacoma and several others
(Olympia and Bremerton) are
arguably close enough to be
influenced
by these cities.
The arbitrator does not find this list entirely convincing
for
several reasons. First, the evidence is at least question-
able
concerning the reliance on these comparables in recent
years.
For instance, during the last negotiations, the CPI was
the
principal consideration by both sides and during the nego-
tiations for this agreement the City discussed, but
did not
accept,
these cities as the appropriate comparators. Second,
in
the past, the City has not employed a professional negotiator
and
has not pursued negotiations as far as interest arbitration.
This being so, the reliance by
one side or the other on a set
of
comparables is not as significant as it might otherwise be.
Third, the fact that either or
both parties used a particular
set
of comparables in a given year does not cast the matter in
concrete
for future years. In this case, the so-called bench-
mark
comparators and more particularly the Puget Sound cities
may
have been comparable in the early 1970s, when the timber
industry
was booming, but there are obvious dissimilarities
between
Longview and Seattle/Tacoma sattelite cities today.
This is vividly demonstrated
in the listing of hourly wage
rates
among the benchmark cities (Exhibit U-25) . Not sur-
prisingly, the six (6) non Puget Sound cities (Port
Angeles,
Aberdeen, Bellingham, Olympia,
Bremerton and Longview) are
at
the bottom. Finally, a review of Longview against the bench-
mark
cities shows that Longview is near the bottom in size
(Exhibit
U-16).
B. The Local Labor Market
The City takes the opposite approach to developing a set
of
comparables. The City's proposed comparators are drawn
from
what it defines as the local labor market, i.e., demograph-
ically similar departments within a sixty (60)
mile radius of
Longview.
The first and possibly most obvious problem with the City's
labor
market approach is that it is apparently inconsistent with
the
mandate of RCW 41.56.460(c) which requires the interest
arbitrator
to compare wages of the City with "the wages of. .
cities
and counties. . of similar size on the west coast of
the
US." A
pure labor market approach, as suggested by the City,
is
inconsistent with this mandate because it deletes similarly
sized
cities outside the relevant labor market. This is not to
say
that, in certain circumstances, an appropriate set of compara-
tors cannot be drawn entirely from departments
in the same vicinity,
i.e., departments operating in
the same labor market. The
Bothell case is an example of
a case where this approach was
appropriate
because demographically similar departments were
available
within the local labor market. However, the arbitrator must agree
with
the Union's counsel that the majority of the labor market
comparators
proposed by the City are not demographically similar
to
Longview and thus they are not appropriate comparators.
In this regard, other than
Olympia and Vancouver, which are
also
on the Union's list, and Clark County #5, which employs
approximately
the same number of employees as Longview, most
of
the proposed comparators employ significantly fewer fire
fighters
than Longview and presumably rely more on volunteers.
Some also tend to protect more
rural areas than Longview. Second,
while
it is not essential that the comparators of either side be
discussed
in the negotiations process, it is significant that
the
City's proposed comparators were apparently developed for
this
arbitration. Had the City presented its proposed comparators
to
the Union at an earlier time, it is possible that the parties
could
have worked cooperatively toward developing a mutually
acceptable
list.
C. Lumber Intensive
Communities - West Coast
The City offered a secondary set of comparables consisting
of
"lumber intensive communities - west coast" in the event
the
arbitrator rejected its labor market approach. There is
some
validity to this approach inasmuch as Longview, like the
other
communities, is "lumber intensive."
Moreover, this
approach
more closely parallels the statutory mandate to consi-
der similarly sized US cities on the west
coast. However, as
the
Union correctly points out, there are some problems with
these
proposed comparators. First, little, if any, evidence
was
presented to demonstrate the demographic similarity
between
these cities and Longview. For instance, there is
no
evidence to indicate why these cities were selected, rather
than
other timber related communites, such as Eugene and
Medford
in
Oregon or Redding in California. Second, while a similar
economic
base (i.e., the timber industry) is one (1) relevant
factor
in selecting appropriate comparables, it is by no means
the
only relevant criterion.
D. The Arbitrator's Approach
In the arbitrator's view, the comparability problem in this
case
is primarily the product of the parties' failure to address the
issue
of selecting comparables at the bargaining table. Had
they
done so, it is likely some consensus could have been
reached
on the means of selecting comparables, if not on the
comparables
themselves. At any rate, the arbitrator is left with
a
long list of "potentials", which arise out of the parties'
widely
divergent approaches to comparability. The arbitrator will
select
from this list of "potentials" those departments he con-
siders most appropriate. The arbitrator strongly
suggests to
the
parties that, in future negotiations, they address the issue
of
selecting comparables at the bargaining table and attempt to
reach
some consensus with a view toward achieving a common base
from
which to negotiate.
Turning to the list of benchmark cities offered by the
Union, the arbitrator's
approach will be to focus on
cities
away from the Seattle/Tacoma metropolital area.
These cities are Bellingham,
Bremerton, Olympia, Aberdeen,
Port
Angeles and Vancouver. Interestingly, two (2) of these
cities
(Vancouver and Olympia) are also on the City's labor
market
list and two (2) others (Aberdeen and Port Angeles) are
on
the City's "lumber intensive" list. In addition to these
six
(6) comparators, the arbitrator will also take Clark County
#5 from the City's labor
market list and Springfield, Oregon
from
its "lumber intensive" list.
In the arbitrator's view, this list of comparators is
fair
to both sides. The six (6) cities taken from the
so-called
"benchmark cities" are selected because they are
demographically
similar and most importantly because they, like
Longview, are away from a
large metropolitan area. Moreover,
as
indicated previously, four (4) of these six (6) cities were
also
proposed by the City, either as being in the same labor
market
as Longview or as being "lumber intensive" like Longview.
Clark County #5 is selected
because, in the arbitrator's view,
it
is the most similar to Longview of the remaining "labor
market"
departments. This conclusion is based largely on the
similarity
between Clark County #5 and Longview in terms of
employment
levels. Finally, Springfield is selected as a
"timber
intensive" community experiencing some of the same
fiscal
difficulties as Longview. This selection is beneficial
to
the City because Springfield has experienced particularly
serious
financial problems and as a result its fire fighters
have
historically been compensated at the lower end among
comparable
Oregon communities. On the other side of the coin,
using
Olympia as a comparator tends to weigh more in favor
of
the Union. Olympia is close enough to Tacoma that its wage
rates
are probably influenced to some extent by those in the
Seattle/Tacoma
metro area. Moreover, Olympia fire fighters
work
more hours (56) than other Washington departments. This
tends
to result in a higher monthly salary for Olympia fire
fighters.
Finally, the arbitrator's comparability data will be based
on
1986 wage rates (after all the arbitrator's mandate is to
award
wage rates for 1986) for top step fire fighters. The
arbitrator
will not utilize the "weighted average" approach
suggested
by the City because too many variables are involved.
Using these criteria, the
arbitrator suggests the following com-
parables:
__________
1986 Wage Rates
Jurisdiction Top
Step FF
Bellingham 2405
Vancouver 2460
Aberdeen 2342
Bremerton 2369
Port Angeles 2437
Clark County #5 2379
Olympia 2541
Springfield 2157*
Average 2386
Longview 2307
Differential 3.42%
_____
* The Springfield wage rate includes a 2% wage
adjustment in March, 1986 and an
additional 7%
for retirement pick up. Springfield
fire fighters
will also receive split increases
totaling 5% in
1987 and an additional 6% in 1988.
__________
The Consumer Price Index
The Consumer Price Index (CPI) is an important consideration
in
this case. As the City correctly observes, the CPI has been
one
of the primary determinants of Longview fire fighter wage
rates
in recent years.
There are several reasons why the CPI is important in these
negotiations.
First, by all accounts, Longview's timber based
economy
is experiencing economic difficulties. The sate[sic]
of
the
local economy is reflected in the regional Consumer Price
Index
(Portland CPI). Stated another way, the regional CPI
accounts
for much of what is happening in the local labor market.
Second, the comparability data
utilized by the arbitrator indi-
cates that Longview wage rates are generally
competitive with
those
of the comparator jurisdictions, assuming a modest wage
increase
is provided in 1986 and 1987. Thus, the CPI provides
a
fair indicator of what a reasonable wage adjustment should be.
Utilizing the same approach followed in the most recent
collective
bargaining agreement between the parties (September
1983 through 1984 Portland
CPI-U x 80%) , the percentage increase
indicated
is 3.28% (September 1984 through 1985 Portland CPI-U
x
80%). Moving forward, a review of the CPI figures in 1986
indicate
the index has declined over this period. On the other
side
of the coin, reasonable projections for 1987 suggest infla-
tion is likely to be in the 4% range.
Other Factors
Another of the factors traditionally considered in inter-
est disputes is parity. This factor is
significant in Longview
because
it appears that historically fire fighter wage adjust-
ments have paralleled those paid to other City
employees.
According to the City, other
employees have already accepted
the
wage adjustments offered to the fire fighters.
The arbitrator will consider the factor of parity in devel-
oping his award, particularly as it relates to
increases in
base
wage rates. However, it is important to recognize that
one
of the key issues in this dispute involves incentive
premiums
for EMT certified fire fighters. By all accounts,
the
EMT program in Longview has expanded dramatically and this
should
be reflected in selective wage relief, both as an incen-
tive and also as a reward for this difficult
work. In this
regard,
it is also important to recognize that, since all fire
fighters
will not be entitled to the EMT premium, the City's costs
are
less for selective EMT premiums than for an across the board increase.
D. Award
1) Effective January 1,
1986, increase all bargaining unit
wage
rates by 1.5%.
2) Effective January 1,
1986, increase the EMT premiums
in
Section 12.3 of the collective bargaining agreement as follows:
an
additional $75.00 per month over the current amount for those
holding
an EMT I certificate and an additional $25.00 per month for
those
EMT I fire fighters who completed ten (10) additional
hours
of continuing EMT education in 1985. The above EMT
premiums
are not intended to effect previously agreed upon
shift
trading privileges. These premiums are to be paid during
the
term of the contract.
3) Effective January 1,
1987, increase all bargaining unit
wage
rates by 3.5%.
Issue #2 Insurance (Article 10)
The City's contribution toward insurance premiums (medical,
dental
and life) is currently capped at $204.87 per employee
per
month. This results in a maximum out of pocket expense for
employees
with two (2) or more dependents (depending on coverage
selected)
of approximately $33.40 in 1986.
A. The Union
The Union wants the City to pay the full cost of insurance
coverage
on behalf of all bargaining unit employees.
According to the Union, the current contribution required
by
bargaining unit employees is unacceptable because it requires
a
fire fighter with two (2) or more dependents to pay approximately
1.5% of his gross salary
towards insurance. Moreover, the addi-
tional cost to the City of providing full coverage
at no cost
to
bargaining unit employees would be very small.
B. The City
The City's proposal on insurance is not entirely clear.
Apparently, the City is
willing to raise its contribution
level
to the same level it currently pays on behalf of other
City
employees. This
amount is $209.00 plus $4.50 towards
life
insurance for employees selecting CMS coverage and $205.00
Plus
$4.50 for employees under the Kaiser Plan. 3
_____
3 These are the contribution levels effective
January 1, 1987.
The City's proposed contribution level for 1986 is slightly
less.
_____
According to the City, its policy has always been to
utilize
step rates with a cap on the employer's contribution.
Moreover, under its proposed
caps for 1987, only employees with
two
(2) or more dependents pay anything out of pocket and even
then
the maximum employee contribution is $22.25.
C. Discussion
The arbitrator is convinced that the City can pay the full
cost
of insurance coverage for bargaining unit fire fighters.
In this regard, the arbitrator
considers it significant that
he
has made a conservative award with respect to wage adjust-
ments.
D. Award
Cap the City's insurance contribution for 1986 and 1987 at
the
maximum premium amount (medical, life and dental) for each
of
those years.
Respectfully submitted this
19th day of February, 1987,
/s/
George Lehleitner
Interest Arbitrator