And
Public
Safety Employees, Local 519, SEIU, AFL-C101
Interest
Arbitration
Arbitrator: William H. Dorsey
Date
Issued:
Arbitrator:
Dorsey; William H.
Case #: 05500-I-84-00125
Employer:
Date Issued:
In the Matter of the Interest
Arbitration between: )
) PERC CASE NO.
PUBLIC SAFETY EMPLOYEES, LOCAL
519, SEIU, AFL-C101 ) 5500-1-84-125
)
The
) BASE WAGE RATES
and )
)
)
The County. )
)
_____________________________________________________
)
Dates and Place of Public
Hearings: February
25 and 26, 1985;
Dates and Place of Executive
Sessions
of
the Interest Arbitration Panel:
April
1, 15 and 17, 1985;
Representing the
Will
Aitchison, Esq.
Aitchison, Imperati, Paull,
Barnett & Sherwood, P.C.
Jared Karstetter
Business Representative
Public Safety Employees,
SEIU Local 519
Representing the County: Albert
G. Ross
Personnel
Manager
Dept.
of Executive Administration,
Daniel
S. Smolen
Labor/Employee
Relations
Specialist
- Personnel
Dept.
of Executive Administration,
REPORT OF THE NEUTRAL CHAIRMAN
INTEREST ARBITRATION PANEL
INTRODUCTION
On
collective
bargaining agreement covering the two-year period
For the two-year period in question, this agreement fixed
the
wages,
hours, and other terms and conditions of employment for
the
sworn personnel of the County's Department of Public Safety
who
are below the rank of captain.
However, Section 1(b) of Article VIII, Wage Rates, of
this
Agreement expressly provided
that:
"Effective
set
forth in the 1984 wage addendum shall be adjusted
by
an amount as negotiated between the parties during
1984 or as established through
binding arbitration
as
provided for in R.C.W. 41.56."
(Arbitrator's
emphasis;
page 21 of Joint Exhibit I.)
Negotiation and mediation ultimately proved unsuccessful
in
establishing
"the base wage rates" to be effective January 1,
1985. Accordingly, by a letter dated
L. Schurke,
Executive Director of the Public Employment Relations
Commission of the State of
he
had concluded that they "remained at impasse and that there-
fore
they must proceed to interest arbitration (see Joint Exhibit
II)
By a letter dated
both
the Neutral Chairman and the Public Employment Relations
Commission that the interest
arbitration panel in this case
would
be composed of the following persons:
William H. Dorsey, Neutral
Chairman
Arbitrator,
Dustin N. Frederick, Union
Arbitrator
Business Representative
Public Safety Employees Local
519
James R. Anshutz,
Budget Supervisor, King County
Budget Office
The parties then agreed with the Neutral Chairman that
the
public
hearings in this case would be held on February 25 and 26,
1985 in
third
day of public hearing proved to be necessary, it too was
held
in
In addition, the panel members met in executive session
in
1985.
ISSUE
Because of the express language used by the parties in
Sec-
tion 1(b) of Article VIII of their 1984-1985 Agreement
(page 21
of
Joint Exhibit I), the sole issue before this interest arbitra-
tion panel is:
By what amount, if any, should
the base wage rates set
forth
in the 1984 wage addendum (Addendum A to the
1984-1985 Agreement; see pages
49-50 of Joint Exhibit
I) be adjusted, retroactive to
effective
through
CONTROLLING STATUTORY
PROVISIONS
The parties agree that the statutory standards which are
controlling
on this interest arbitration panel are set forth in
RCW 41.56.460, which reads:
"UNIFORMED PERSONNEL -
INTEREST ARBITRATION PANEL -
BASIS
FOR DETERMINATION. In making its determination,
the
[interest arbitration] panel shall be mindful of
the
legislative purpose enumerated in RCW 41.56.430
and
as additional standards or guidelines to aid it
in
reaching a decision, it shall take into considera-
tion the following factors:
"(a) The constitutional and statutory
authority
of
the employer;
"(b) Stipulations of the parties;
"(c) Comparison of the wages, hours and condi-
tions of employment of personnel involved in the
pro-
ceedings with the wages, hours, and conditions of
employment
of like personnel of like employers of
similar
size on the west coast of the
" (d) The average consumer prices for goods and
services,
commonly known as the cost of living;
" (e) Changes in any of the foregoing circum-
stances
during the pendency of the proceedings; and
" (f) Such other factors, not confined to the
foregoing,
which are normally or traditionally taken
into
consideration in the determination of wages,
hours
and conditions of employment."
(Arbitrator's
emphases;
pages SR-37/SR-38 of Joint Exhibit VII.)
QUESTIONS OF FACT BEFORE
THE PANEL
Essentially, there are three questions of fact in this
case:
One, what is the appropriate method for selecting
"employers
of
similar size [to
of
the
Two, having selected these "comparable"
employers, how does
one
then assess "the base wage rate set forth in the 1984 wage
addendum"
to the parties' 1984-1985 Agreement (pages 49-50 of
Joint Exhibit I), in light of
"the base wage rates" paid by these
comparable
employers?
Three, irrespective of what these comparisons of base
wage
rates
might show, nevertheless must the interest arbitration
panel
make an adjustment for the difference in the cost of living in
these
comparable jurisdictions in northern and southern
with
the cost of living in
ARGUMENTS OF THE PARTIES
Position and Arguments of the
The
wages
alone the members of the bargaining unit should be given an
across-the-board
wage increase of between 8.52 percent and 11.20
percent.
In support of this position, the
One, from the evidence in the record, it is now clear
that
the
parties wish this arbitration panel to select a set of juris-
dictions
which represent jurisdictions which have a good deal in
common
with King County, Washington.
Two, also from the evidence in the record, it would now
appear
that the parties agree that the utilization of demographic
characteristics
in the selection of comparable jurisdictions to
King County is the most
appropriate approach for the panel to
take.
Three, the following three counties should be viewed by
the
panel
as comparable to King County:
-Alameda County, California
-Orange County, California
-Santa Clara County, California.
Four, looking at comparable wages, the panel should
include
the
so-called PERS "pick-up" where it exists.
Five, the panel should ignore the participation or non-
participation
of all employers (including King County) in the
social
security system in making its wage comparisons.
Six, because the only two current methods of evaluating
comparative
costs of living are both greatly flawed in a methodo-
logical
and data collection sense, the arbitration panel should
make
no attempt to adjust any conclusion reached by it after com-
paring
the base wage rates paid by King County to the members of
the
bargaining unit with those paid to like employees by the
other
comparable jurisdictions.
Seven, a comparison of the base wage rates paid to the mem-
bers of the bargaining unit by King County with
the three compar-
able
jurisdictions selected by the Union shows that the panel will
need
to award an 11.20 percent wage increase in order to bring
the
King County deputies to the average wage paid to law enforce-
ment officers in these comparable jurisdictions.
Eight, moreover, when wages are viewed across levels of
tenure
of five, ten, fifteen and twenty years (and levels of
education
including high school, A.A. and B.A. degrees), it is
immediately
evident that a minimum wage increase of 8.52 percent
is
indeed appropriate for the members of the bargaining unit
represented
by the Union.
Position and Arguments of the County
The County's position is that on the basis of all of the
statutory
standards set forth in RCW 41.56.460 (including, of
course,
comparable wages) no across-the-board wage increase in
the
calendar year 1985 should be given to the members of the bar-
gaining
unit represented by the Union.
In support of this position, the County argues:
One, the utilization of demographic characteristics in
the
selection
of jurisdictions comparable to King County is indeed
the
most appropriate approach for the panel to take.
Two, however, in the selection of jurisdictions
comparable
to
King County, only the demographic characteristics of the un-
incorporated
areas of King County should be compared with the
demographic
characteristics of other unincorporated areas of
counties
on the west coast of the United States.
Three, the following three counties should then be viewed
by
the
panel as comparable to King County for purposes of this case:
- Sacramento County, California
- San Mateo County, California
- San Diego County, California.
Four, looking at comparable wages, the panel should not
include
the so-called PERS "pick-up", even where it exists,
unless
in doing so the panel then compares the total pension costs
of
each jurisdiction (including, of course, King County) as a
measure
of the value of the actual pension benefits being pur-
chased
by each jurisdiction.
Five, the panel cannot ignore the participation or
non-par-
ticipation of all employers (including King County) in
the social
security
system in making its wage comparisons.
Six, in any event, the panel must adjust any conclusion
reached
by it after comparing the base wage rates paid by King
County to the members of the
bargaining unit with those paid to
like
employees by the other comparable jurisdictions because of
the
obvious differences in the cost of living in any comparable
jurisdiction
in northern and southern California with the cost of
living
in King County, Washington.
It is obvious that any person contemplating a relocation
from
one geographical area to another who fails to consider rela-
tive living costs of the two areas involved does
so at his/her
peril. Moreover, the cost of living is a major
factor driving
wage
levels.
In addition, the cost of living is heavily used in both pri-
vate and public sector free collective
bargaining and has been so
used
for years. As a matter of fact, RCW
51.56.460(d) requires
that
this arbitration panel consider the "CPI" in making its
determination.
Finally, "the Runzheimer
Plan of Living Cost Standards"
(County Exhibits 13, 15, and
26) provide the needed measure of
differential
costs of living between geographical areas.
Seven, as a matter of fact, Runzheimer
shows that the cost
of
living in King County, Washington is considerably lower than
the
cost of living in any comparable jurisdiction either in
northern
or southern California.
Also as a matter of fact, any increase in the
"CPI-W" for
the
Seattle metropolitan area over the last ten years (i.e., from
the
start of 1975 to the start of 1985) has been more than made
up
by an increase in the actual wage rates being paid the members
of
the bargaining unit represented by the Union.
(See County's
Exhibit
6.)
Eight, accordingly, the record in this case shows conclu-
sively that no general, 1985, wage increase is
required for the
members
of the bargaining unit represented by the Union under
RCW
41.56.460.
SPECIFIC FINDINGS OF FACT
BY THE NEUTRAL CHAIRMAN
Introduction
At the start of the second executive session of this
panel
on
April 1, 1985, the Neutral Chairman informed the panel mem-
bers that based upon the evidence in the record
in this case,
on
his "intuition", and as a result of his travels up and down
the
west coast of the United States, he considered the following
jurisdictions
to be those most comparable with King County:
- Pierce County, Washington
- Multnomah County, Oregon
- Alameda County, California
- Orange County, California
- Sacramento County, California
- San Diego County, California
- Santa Clara County, California.
Both the Union's arbitrator and the County's arbitrator
then
reminded
the Neutral Chairman that in effect, because the parties
had
agreed in negotiations that both Pierce County, Washington
and
Multnomah County, Oregon would not be considered comparable
jurisdictions
to King County, Washington, there was no evidence
in
the record which would allow the panel to compare the base
wage
rates paid to the members of the bargaining unit in King
County with the base wage
rates paid to law enforcement officers
in
either Pierce County, Washington or Multnomah County, Oregon.
The Neutral Chairman,
therefore, immediately agreed with the
other
members of the panel that these two jurisdictions could not
be
considered as comparable jurisdictions to King County.
The Neutral Chairman then suggested that if Alameda
County,
California were also
eliminated from his proposed list of com-
parable
jurisdictions, the panel would then be left with four
comparable
jurisdictions -- two of which had been suggested by
the
Union (Orange and Santa Clara Counties, California) and two
of
which had been suggested by the County (Sacramento and San
Diego Counties,
California). In addition, the Neutral
Chairman
pointed
out that each of these four jurisdictions, on the basis
of
population alone (whether county-wide or solely in the un-
incorporated
areas), was comparable to King County, Washington.
"Comparable Jurisdictions"
The Neutral Chairman hereby finds, as a specific finding
of
fact,
that the most appropriate method for selecting "employers
of
similar size [to King County, Washington] on the west coast
of
the United States" involves the use of demographic character-
istics.
In addition, the Neutral Chairman also finds, as a
specific
finding
of fact, that in applying demographic characteristics
(particularly
that of population) the following counties "on the
west
coast of the United States" are
comparable" employers to
King County, Washington, for
purposes of this interest arbitra-
tion case:
- Orange County, California
- Sacramento County, California
- San Diego County, California
- Santa Clara County, California.
PERS "Pick-up" vs. Total Pension Costs
Also during the second executive session of this panel on
April 1, 1985, the Neutral
Chairman informed the members of the
panel
that, again based on the evidence in the record in this
case,
he was convinced that:
One, not only is the PERS pick-up a fact of life in
Orange,
Sacramento, San Diego and
Santa Clara Counties in California,
but
as a matter of fact this pick-up was negotiated in lieu of a
wage
increase in these counties.
Two, any attempt on his part as the Neutral Chairman to
take
into consideration the so-called "total costs" of all pen-
sion benefits provided for the members of the
bargaining unit in
King County and the
"total costs" of all pension benefits pro-
vided
to law enforcement officers in the other four comparable
jurisdictions
would distort both "the base wage rates" paid by
King County to the members of
the bargaining unit (which admit-
tedly are solely at issue in this case) and the
base wage rates
paid
to like employees by these four comparable jurisdictions.
Following a lengthy discussion between the members of the
panel
and the Neutral Chairman, it was agreed that the two mem-
bers of the panel would jointly attempt to
verify from the res-
ponsible officials in the counties of Orange,
Sacramento, San
Diego and Santa Clara whether
the evidence which the Union had
already
introduced into the record in this case (to the effect
that
PERS pick-ups in those counties had indeed been negotiated
in
lieu of a wage increase) was correct.
At the third executive session of this arbitration panel
on
April 15, 1985, both the Union
arbitrator and the County arbitra-
tor informed the Neutral Chairman that they had
jointly verified
that
this evidence of the Union which is in the record is correct.
Accordingly, the Neutral Chairman hereby finds, as a
specific
finding
of fact, that the base wage rates paid to law enforcement
officers
in Orange, Sacramento, San Diego and Santa Clara counties
include
various PERS pick-ups.
In addition, the Neutral Chairman also hereby finds, as a
specific
finding of fact, that any attempt on his part to take
into
consideration the so-called "total cost" of all pension
benefits
provided by employers (including King County, Washington)
would
automatically distort the base wage rates being paid by
King County to the members of
the bargaining unit and by the
other
four comparable jurisdictions to their law enforcement
officers. In making this specific finding of fact, the
Neutral
Chairman also expressly notes
that the County's arbitrator, James
R. Anshutz,
continues to disagree with the Neutral Chairman on
this
point.
Participation/Non-Participation in the Social Security
___________________System________________
Another substantive difference between the parties
concern-
mg
the analysis of total compensation is the question of the
treatment
of social security. Because King County,
Washington
participates
in the social security system, not only does King
County have a cost which three
of the four comparable jurisdic-
tions do not have, but the members of the
bargaining unit repre-
sented by the Union also have a cost which is not
shared by their
compatriots
in three of the four comparable jurisdictions.
The County has advocated including the County's FICA
costs
as
compensation to the members of the bargaining unit, but not
subtracting
the employees' FICA costs,in determining the actual
compensation
received by the members of the bargaining unit.
The Union, on the other hand,
has proposed simply ignoring par-
ticipation or non-participation in the social security
system in
its
total compensation analysis.
Based on the evidence in the record in this case, the Neu-
tral Chairman hereby finds, as a specific
finding of fact, that
in
comparing base wage rates he must ignore the participation or
non-participation
of all employers (including King County, Wash-
ington) in the social security system in making
his comparisons
of
base wage rates. The Arbitrator has
reached this conclusion
for
the following reasons:
One, the approach taken by the Union, that of ignoring
the
participation
or non-participation in social security of the
various
comparable jurisdictions, is one that has been adopted
by
arbitrators who have been presented by the very same issue in
prior
interest arbitration cases.
Two, because participation in social security includes
both
a
cost to the employer and to the employee, calculating the net
value
to the employee of participation in the social security
system
is problematic at best.
Three, moreover, changes in the social security system
are
particularly
subject to the whim of political caprice.
It is a
valid
question, therefore, as to whether or not the benefits
currently
provided by the social security system will be substan-
tially or completely present at the time the
current employees in
the
bargaining unit are ready to retire.
Four, finally, if the panel must take into consideration
the
cost of King County's participation in the social security
system,
then it is also apparent that the panel must calculate
similar
costs for the comparable counties which have in place
not
only retirement systems but additional benefits which are
similar
or the same as those provided by the social security
system.
By its assumption that participation in the social
security
system
is the only vehicle for providing the benefits offered by
the
social security system, the County has assumed that none of
the
comparable employers have plans which provide supplemental
social
security benefits. This may or may not
be so.
Clearly, if the County is to make an argument that social
security
should be factored into wage calculations, it must also
establish
what supplemental programs, if any, exist in the three
comparable
jurisdictions which do not participate in the social
security
system, and what the employers costs are
for providing
these
supplemental benefits.
The Arbitrator again expressly notes here that the
County's
arbitrator,
Mr. Anshutz, continues to disagree with his specific
finding
of fact on the subject of participation or non-participa-
tion in the social security system.
"Comparative Costs of Living"
Again based on the evidence in the record in this case,
as
well
as the arguments of the Union contained on pages 38-43 of
Mr. Aitchison's
post-hearing brief, the Neutral Chairman hereby
finds,
as a specific finding of fact, that the only two current
methods
of evaluating comparative costs of living (i.e., a
publication
of the American Chamber of Commerce Research Asso-
ciates, "ACCRA", and the comparative
costs of living studies per-
formed
by Runzheimer & Co., Inc., "Runzheimer") are both greatly
flawed
in a methodological and data collection sense.
Because of this specific finding of fact, the Neutral
Chair-
man
also hereby finds that, in spite of County's Exhibit 15 ("The
Runzheimer
Plan of Living Cost Standards Especially Prepared for
King County Personnel
Department, January, 1985"), he should make
no
attempt to adjust any conclusion reached by him, after com-
paring
the base wage rates paid by King County to members of the
bargaining
unit with those paid to like employees in law enforce-
ment by the four other comparable jurisdictions,
for the differ-
ence in the cost of living in these comparable
jurisdictions in
northern
and southern California with the cost of living in King
County.
Once more, the Neutral Chairman expressly notes here that
the
County's arbitrator, Mr. Anshutz, expressly disagrees
with
this
finding of fact by the Neutral Chairman.
THE NEUTRAL CHAIRMAN'S
ANALYSIS AND REASONING
Introduction
The parties, in uniformed personnel interest arbitration
cases,
and the interest arbitrators themselves, are in general
agreement
that any comparison of base wage rates between compar-
able
jurisdictions must be at the top step of the "deputy sheriff"
of
"police officer" classification.
In making such a comparison of base wage rates of the
deputy
or
officer classification at the top step, however, a problem
immediately
presents itself. This problem arises
because of the
variations
in the longevity steps and the variations in the so-
called
"education and training' , incentive programs between King
County
and the four comparable jurisdictions.
The Union would solve this problem by viewing wages
across
levels
of tenure of five, ten, fifteen, and twenty years, and
levels
of education, including high school, A.A., and B.A.
degrees. The County, on the other hand, would only
compare wage
rates
payable in King County and in the four comparable jurisdic-
tions for a 25-year and a 10-year employee.
In making its comparisons, the County stated
that it had
selected
these two time frames, first to get a picture of what an
employee
facing retirement would be receiving, and second to por-
tray
what the typical employee receives in King County, in view
of
the fact that the average length of service for King County
deputies
in the bargaining unit is 9.7 years (see County's
Exhibit
17).
The Wage Comparisons of the Neutral Chairman
The record in this case demonstrates conclusively that
the
longevity
system of King County is entirely different from that
used
in the four comparable jurisdictions. It
also demonstrates
conclusively
that the "educational and training" incentive system
employed
in King County is substantially different from the so-
called
"P.O.S.T." incentive systems used in the four comparable
counties. The Neutral Chairman hereby makes specific
findings of
fact
to those effects.
Because of these two specific findings of fact, the
Neutral
Chairman has concluded that
any comparison between employees in
the
bargaining unit in King County and law enforcement officers
in
the other four comparable jurisdictions would be distorted if
they
were other than at the 10-year employee level.
The Neutral
Chairman hereby makes a
specific finding of fact to that effect.
The evidence in the record likewise shows that King
County
is
the only jurisdiction of the five in question with a straight
longevity
system. Accordingly, a comparison of
King County's
straight
"base rate", without consideration of an employee's
longevity
with King County, with the "base rates" paid by the
four
other comparable jurisdictions, would be meaningless. This
is
so because any deputy sheriff in King County with ten years of
service
will also automatically receive, on top of the base rate
of
$2,465 a month, a $119 longevity bonus, for a total of $2,584,
while a
law enforcement officer in any of the comparable juris-
dictions,
even with ten years of service, will still only be
receiving
the base rate which he/she would have received once he/
she
had become a permanent deputy or police officer. The Neutral
Chairman hereby likewise makes
specific findings of fact to
these
effects.
Accordingly, based on the above specific findings of
fact,
the
Neutral Chairman hereby finds, as the appropriate set of base
wage
rates for salary comparisons in this case, the following:
One, both for King County and the four
comparable jurisdic-
tions noted above, the base wage rate for an
employee with a
high
school degree only and with ten years of service.
Two, for King County only, the base wage rate for an
employee
with a
B.A. degree and with ten years of service.
Three, for the four comparable jurisdictions (but not for
King County) the base wage
rate for an employee with an Advanced
P.O.S.T.
Certification, and with ten years of service.
Four,
finally, for both King County and the comparable juris-
dictions,
the base wage rate for an employee entitled to the
maximum
incentives allowable in each jurisdiction and with ten
years
of service.
Two Essential Tables for Comparison
The appropriate set of base wage rates for salary compari-
sons
in this case, as outlined above, are reflected in the fol-
lowing
Table for Comparison:
TABLE I
COMPARISON, 10-YEAR EMPLOYEES, MONTHLY WAGE RATES
10
Yrs. Srvs. 10
Yrs. Srvs. 10
Yrs. Srvs. 10 Yrs. Sr
Only Plus
Plus Plus
County H.S. Diploma B.A. Degree Advanced
POST Max. Incentive
Orange County $2,659 --- $2,869 $2,869
4-COUNTY AVERAGE $2,468 --- $2,670 $2,728
* This figure for
because
none of the other three comparable jurisdictions provide
incentive credit for a B.A. degree, the
figure
has been omitted in this Table I.
**
of a
B.A. degree and an Advanced P.O.S.T. Certification. It
amounts
to 20% above the base wage rate ($2,332 + 20% ($466)--
$2,798).
*** Among the five jurisdictions shown on
this Table I, only
vity premium at 10 years of service is $119 a
month. (Base rate
$2,465
+ $119 $2,584 a month.)
At the third executive session of this arbitration panel
on
April 15, 1985, the Union
arbitrator and the County arbitrator
jointly
informed the Neutral Chairman that the following table
("Table II")
correctly reflects the various PERS pick-ups cur-
rently in existence in the counties of
Diego,
and
TABLE II
VERIFIED PERS PICK-UPS IN LIEU OF WAGE INCREASES
County Employer
Pick-up Percentage
Pick-ups)
FOUR COUNTY AVERAGE 6.94125% (6.94%)
Three Methods of Comparison
FIRST METHOD OF COMPARISON
(A) Take the
average base rates of the four comparable
jurisdictions
for a 10-year employee with only a high school
diploma
($2,468) and the average base rate of the four comparable
jurisdictions
for a 10-year employee entitled to maximum incen-
tive pay ($2,728).
(B) Then average
these two figures: $2,468 plus $2,728
equals
$5,196 divided by 2 equals $2,598.
(C) Increase
this figure ($2,598) by the average PERS pick-
up
for employees in these four comparable jurisdictions (6.94%)
for a
first PERS-adjusted average monthly base wage rate ($2,598
x
1.0694 = $2,778).
(D) Then take
King County's monthly base wage rate for a 10-
year
employee with only a high school diploma ($2,584) and King
County's monthly base wage for
a 10-year employee entitled to
maximum
incentive pay ($2,702).
(E) Next,
average these two figures: $2,584 plus ~2,702
equals
$5,286 divided by two equals $2,643.
(F) Finally,
compare the first PERS-adjusted average month-
ly base rate, as calculated above ($2,778),
with the average of
the
"low" and "high" monthly base rates paid by King County to
a
10-year employee
($2,643): $2,778 minus $2,643 equals
$135 dif-
ference.
$135 divided by $2,643 equals .05107832.
(G) Accordingly
an adjustment of 5.11 percent in the
average
of the "low" and "high" monthly base rates paid by King
County to a 10-year employee
in the bargaining unit would appear
to
be in order under this method of comparison, standing alone.
SECOND METHOD OF COMPARISON
(A) Take the
average base rate of the four comparable juris-
dictions
for a 10-year employee with an Advanced P.O.S.T. Certi-
fication ($2,670) and the average base rate of the
four compar-
able
jurisdictions for a 10-year employee entitled to maximum
incentive
pay ($2,728).
(B) Then
average these two figures: $2,670 plus
$2,728
equals
$5,398 divided by 2 equals $2,699.
(C) Increase this
figure ($2,699) by the average PERS pick-
up
for employees in these four comparable jurisdictions (6.94
percent)
for a second PERS-adjusted average monthly base wage
($2,699 times 1.0694 equals
$2,886)
(D) Then take
year
employee with a B.A. degree ($2,663) and
ly base wage rate for a 10-year employee
entitled to maximum
incentive
pay ($2,702).
(E) Next average
these two figures: $2,663 plus $2,702
equals
$5,365 divided by two equals $2,682.50.
(F) Finally,
compare the second PERS-adjusted average
monthly
base rate, as calculated above ($2,886), with the average
of
the "middle" and "high" monthly base rates paid by
to a
10-year employee ($2,682.50): $2,886
minus $2,682.50 equals
$203.50
difference.
$203.50 divided by $2,682.50 equals
.075862068.
(G) Accordingly,
an adjustment of 7.59 percent in the
average
of the "middle" and "high" monthly base rates paid by
appear
to be in order under this method of comparison, standing
alone.
THIRD METHOD OF COMPARISON
(A) Take the
average base rate in the four comparable
jurisdictions
for the following 10-year employees:
(1) An employee
with a high school diploma only: $2,468.
(2) An employee
with an Advanced P.O.S.T. Certification:
$2,670.
(3) An employee
entitled to maximum incentive pay: $2,728.
(B) Then average
these three average base rates: $2,468
plus
$2,670 plus $2,728 equals $7,866 divided by three equals
$2,622.
(C) Increase this
figure ($2,622) by the average PERS pick-
up
for an employee in these four comparable jurisdictions (6.95
percent)
for a third PERS-adjusted average monthly base wage
($2,622 times 1.0694 equals
$2,804).
(D) Then take King
County's monthly base wage rate for the
following
10-year employees:
(1) An
employee with a high school diploma only: $2,584.
(2) An
employee with a B.A. degree: $2,663.
(3) An
employee entitled to maximum incentive pay: $2,702.
(E) Next
average these three base wage rates:
$2,594 plus
$2,663 plus $2,702 equals
$7,949 divided by three equals $2,650.
(F) Finally,
compare the third PERS-adjusted average month-
ly base wage, as calculated above ($2,804),
with the average of
the
three monthly base wage rates paid by King County to a 10-
year
employee ($2,650): $2,804 minus $2,650
equals $154 differ-
ence.
$154 divided by $2,650 equals .058113207.
(G) Accordingly,
an adjustment of 5.81 percent in the
average
of the three monthly base wage rates paid by King County
to a
10-year employee in the bargaining unit would appear to be
in
order under this method of comparison, standing alone.
The Conclusion of the Neutral
Chairman from These
_____________Three
Comparisons___________
When the three adjustment percentages arrived at above
(5.11 percent, 7.59 percent,
and 5.81 percent) are themselves
averaged,
it would appear that an adjustment of 6.17 percent in
the
base wage rates paid by King County to a 10-year employee in
the
bargaining unit would be in order.
The Neutral Chairman hereby automatically
rounds this per-
centage figure downward to 6.00 percent.
CONSIDERATION OF TWO
ADDITIONAL "STATUTORY FACTORS"
Introduction
The question naturally arises: How does this proposed 6.00
percent
increase in the base wage rates paid by King County to
the
members of the bargaining unit "stand up" when viewed in
light
of changes in the "CPI" over various periods of time and in
light
of the recent settlement made by the City of Seattle with
the
Seattle Police Officers Guild?
Consideration of the CPI
The County is correct in its contention that this
interest
arbitration
panel must now take into consideration the "average
consumer
prices for goods and services, commonly known as the
cost-of-living"
(the "CPI") (see RCW 41.56.460(d).
The Union suggests that the appropriate CPI to be used by
this
panel is the Bureau of Labor Statistics' "CPI-W" for the
Seattle,
Washington area. The
Union then argues that comparing
the
Seattle CPI-W from the start of 1978 (182.5) with the CPI-W
as
of the start of 1985 (305.5) shows that the real wages of the
top-step
deputy sheriff in King County dropped 3.7 percent in
seven
years (see Union w Exhibit 32).
The Union argues, moreover, that if the "time-lag
effect" is
taken
into consideration, the real "loss
of wages due to infla-
tion by the members of the bargaining unit over
this same seven-
year
period is 6.97 percent (i.e., 3.7 percent, "real wage"
adjustment
plus a 3.27 percent "time-lag" adjustment). (See
Union's
Exhibits 32 and 33.)
The County, on the other hand, argues that any attempt to
calculate
either any "loss of real wages" due to inflation or any
additional
loss due to a so-called "time-lag" factor over a seven-
year
period from 1978 to 1985, is entirely unwarranted. Instead,
the
County asserts that only the increase in the Seattle CPI-W
from
November, 1983 to November, 1984 (i.e., 2.86 percent) need
even
be considered by this arbitration panel.
Moreover, the County contends that County's Exhibit 6
shows
that
the members of the bargaining unit are actually receiving
(in
1984 wages) $101 more per month (4.3 percent) than the
monthly
wage which would have been dictated by the full increase
in
the Seattle CPI-W over the past ten years.
Finally, the County notes that the two other bargaining
units
represented
by the Union (non-commissioned personnel at the
Department of Public Safety
and in the Fire Marshall's employ)
only
received a 1985 wage increase of 2.56 percent (an increase
based
on a percentage of the increase in the CPI-W for the period
November, 1983 to November,
1984).
The reaction of the Neutral Chairman to all of these argu-
ments of both sides is:
One, the parties agree that the bargaining units represented
by
the Union who received only a 2.56 percent wage increase for
1985 received these increases
on the basis of a COLA formula in
their
contract tied to the Seattle CPI-W.
Admittedly, the parties
in
this case have no such COLA provision which is controlling here.
Two, the change in the CPI is only one factor to be con-
sidered by the panel in this case.
Three, while all of us in the United States should be
glad
that
the rate of inflation appears to have slowed down dramatic-
ally,
nevertheless the Union's insistence that at least some in-
crease
in the wages of the bargaining unit members for the year
1985 must be given by this
arbitration panel, appears to be justi-
fied, certainly based on the increase in the
CPI-W for the Seattle
area
for the period November, 1983 through November, 1984,
standing
alone.
Four, in any event, the County's admission that between
November 1983 and November
1984 the rate of inflation in the King
County area was 2.86 percent
(as measured by the increase in the
Seattle CPI-W for that period;
see County's Exhibit 6) demon-
strates that the County's insistence that there be
no adjustment
in
the base wage rates for the members of the bargaining unit
for
the calendar year 1985 is indeed unfair.
The City of Seattle Settlement with the Police Guild
The County contends that County Exhibit 35 shows
conclusively
that
the recent settlement between the City of Seattle and the
Seattle Police Officers Guild
was approximately 4.72 percent
(when
the additional holiday -- Martin Luther King Day -- granted
to
all of the employees of the City of Seattle is taken into
consideration)
rather than the 6.2 increase claimed by the
officers
of that guild in their October 4, 1984 letter to the
guild's
membership (see Union's Exhibit 8A).
Moreover, the County likewise claims that a simple compari-
son
of the total compensation paid by King County to the members
of
the bargaining unit (based strictly on the 1984 calendar year
base
rates of pay) with the total compensation paid by the City
of
Seattle to the members of the bargaining unit represented by
that
city's Police Officers Guild shows that what King County pays
the
bargaining unit members exceeds what the City of Seattle pays
its
law enforcement officers by 4.8 percent (see County's Exhibit
36).
The Neutral Chairman understands these arguments of the
County. However, he notes the following facts:
One, the County's calculations in County's Exhibit 35 are
based
on its calculation of the increase in cost to the City of
Seattle brought about by that
city's recent settlement with its
police
officers, as opposed to what the actual percentage increase
in
the base rates of pay for those police officers were.
(A) For example,
County's Exhibit 35 shows that the pay
increase
at the top step for police officer was 4.94 percent,
and
that for the top step of the sergeant classification it was
4.97 percent.
(B) Both of these
figures are obviously higher than the
increase
in costs for the City of Seattle as stated by County's
Exhibit 35 as 4.334 percent on
prior compensation and an addi-
tional .383 percent for the additional Martin
Luther King holiday.
Two, in addition, County's Exhibit 36 is likewise based
on
a
cost comparison between the total overall compensation paid
by
King County to the members of the bargaining unit represented
by
the Union and the total overall compensation paid by the City
of
Seattle to the members of the bargaining unit represented by
its
Police Officers Guild.
Three, moreover, at issue in this case is not the total
over-
all
compensation (including direct salary and fringe benefits)
paid
to the members of the bargaining unit by King County but
instead
the base wage rates to be effective for the calendar year
1985.
Four, finally, the admission in County's Exhibit 35 that
the
COLA adjustment in the pay for police officers in the City of
Seattle at the top step called
for an increase of 4.94 percent in
that
classification, and an increase of 4.97 percent at the top
step
for the sergeant classification, demonstrates conclusively
that
an adjustment in the base wage rates for the members of the
bargaining unit
represented by the Union for the calendar year
1985 certainly is in order,
and that adjustment indeed should
be
higher than the 2.86 percent increase in the Seattle CPI-W for
the
period November 1983 to November 1984.
CONCLUS I ON
Accordingly, based on the evidence presented by the
parties
and
reflected in the record in this case, as well as on his
specific
findings of fact as stated above, the Neutral Chairman 5
answer
to the sole issue before him and the arbitration panel in
this
interest arbitration case is:
The base wage rates set forth in the 1984 wage
addendum
(Addendum A to the parties' 1984-1985
Agreement, pages 49-50 of
Joint Exhibit I) should be
adjusted
upward by 6.00 percent, retroactive to
January 1, 1985, and effective
through December 31,
1985.
A W
A R D
The AWARD, therefore, of the Neutral Chairman
of the arbi-
tration panel in this interest arbitration case is:
Retroactive to January 1, 1985, "the
base wage rates
as
set forth in the 1984 wage addendum [Addendum A; see pages 49-
50 of Joint Exhibit I]"
shall be adjusted upward by 6.00 percent.
DATED at PORTLAND, OREGON, this 13th day of May, 1985.
WILLIAM H. DORSEY, ARBITRATOR
NEUTRAL CHAIRMAN
INTEREST ARBITRATION PANEL
WHD: jk
________________________________________________________________________
In the Matter of the Interest )
Arbitration between: )
)
)
Local 519, Public Safety
Employees, ) County Arbiter's
) Dissenting Opinion,
The Union, ) King County Case No.
) 5500-1-84-125
and )
)
King County, )
)
The Employer. )
___________________________________ )
We believe that the analysis, opinion and award of the
Neutral Arbiter in the above
captioned case is seriously flawed
in
its application of Washington State Law (RCW 41.56.460).
RCW 41.56.460 requires the arbitration panel to consider
three
major factors in rendering an award: a
comparison of the
wages,
hours and working conditions of like employees of like
employers
on the West coast; the CPI; and other factors normally
taken
into consideration when determining wages, hours and con-
ditions of employment. The three major components of RCW
41.56.460 were designed to
create a broad picture of whether a
particular
change in wages is appropriate when those three
equally
considered factors are taken into account.
In our judgment, the Neutral Arbiter failed to comply
fully
with
the provisions of RCW 41.56.460 and was remiss in fulfilling
his
charge by virtue of important omissions from his considera-
tions and imbalanced treatment of arguments
presented in the
course
of arbitration.
In particular, the Arbiter failed to adequately consider
and
weight
compensation paid to the Seattle police force; failed to
balance
considerations among the three factors specified in RCW
41.56.460; and did not give
sufficient consideration of past
practice
and historical precedent in reviewing the factors nor-
mally taken into account in determining wages,
hours and con-
ditions of employment. Our specific points of dissent and
concern
regarding the-Neutral Arbiter's failures in arriving at
his
award are set out below.
CPI
The fact that inflation was 2.86% in the Seattle area
should
have
been taken into account and given substantial consideration
in
developing an award. The Neutral Arbiter
merely acknowledged
the
recent inflation rate and ignored this data in developing his
award,
despite the County's stated willingness in executive
session
of the arbitration panel to agree to an adjustment in the
range
of the most recent rate of inflation as measured by the
CPI-w.
Though scientifically imperfect, the CPI is the standard
and
widely
accepted measure to approximate changes in the cost of
living.. Failure to adequately consider and weight
this factor in
determining
the award results in wage escalations that take no
account
of real costs faced by the employee or real revenue
constraints
faced by the employer whose financial capacity is
affected
by economic conditions.
Seattle Comparison
Seattle police compensation has been the most important fac-
tor in reaching settlement with the County
police union and has
been
historically the most important factor used by prior
arbitrators
in establishing awards. The comparison
of the City
of
Seattle and King County police compensation packages is most
relevant
because both governmental jurisdictions draw employees
from
the same labor market; both jurisdictions face comparable
factors
affecting their financial conditions and costs of living
faced
by their employees; and both police forces operate under
the
most nearly comparable set of laws, policies, and other
requirements
and regulations affecting duties and benefits.
The County presented data on actual compensation received
by
both
Seattle and County police officers that showed current
County compensation exceeded
1985 Seattle police pay by 4.8%.
Even if social security and
County sick leave with compensation
were
excluded from the comparative analysis, a 1985 cost-of-
living
adjustment of 3% would have resulted in County police com-
pensation equal to Seattle police officer rates of
pay. Instead
of
reviewing total compensation the Arbiter chose to ignore this
data
for the stated reason that "at issue in this case is not the
total
overall compensation (including direct salary and fringe
benefits)
paid to the members of the bargaining unit by King
County but instead the base
wage rates to be effective for the
calendar
year 1985."
While the Neutral Arbiter is correct that
adjustments to
County police base wage rates
was the only issue in the arbitra-
tion proceedings, a comparison of total
compensation received by
Seattle and County police is
required per RCW 41.56.460 in deter-
mining
an appropriate adjustment in County police base wage
rates. The Neutral Arbiter was remiss in his failure
to consider
total
compensation in comparing Seattle and King County.
Furthermore, the Neutral
Arbiter chose to ignore total compen-
sation in a comparison of Seattle and King County
police wages
BUT used "PERS
pickup" and incentive, non base pay wages, in com-
paring
King County police wages with other California jurisdic-
tions. The
differential consideration of compensation packages
in
making comparability comparisons among different jurisdictions
is
wrong and wholly indefensible in our judgment.
The Neutral Arbiter focused on the most recent Seattle
police
negotiated settlement which increased base wages by 4.94%.
Again he ignored data
presented by the County that showed that
the
settlement also substantially reduced Seattle police offi-
cers' medical benefit programs. The Arbiter provided no
rationale
for ignoring medical benefit reductions that accom-
panied the Seattle wage settlement. In our judgment, this is
further
evidence of error in the Arbiter's decision.
Even given what we believe to be a flawed interpretation
of
Seattle wage rates, the
Neutral Arbiter failed to apply his
valuation
of the Seattle police settlement in arriving at his 6%
award.
Comparative Jurisdiction
Analysis
We believe that the Arbiter's rationale for basing the 6%
adjustment
on a comparison of "comparable jurisdictions" compen-
sation was also seriously flawed for the following
six reasons:
1. Improperly
selecting jurisdictions as comparable using
county-wide
instead of unincorporated area demographic data.
Orange and Santa Clara Counties are simply not com-
parable
to King County demographically when viewed from the
perspective
of area and population served by County law enforce-
ment personnel, namely, unincorporated, not
County-wide. While
the
population served by the Sacramento and San Diego County
police
forces are within 4% of the population served by the King
County police force, the
Orange County police force serves 43%
fewer
citizens, and the Santa Clara County police force serves
61%
fewer citizens. To
include Santa Clara and Orange Counties
by
allowing County-wide data is to violate the requirement of
RCW 41.56.460(c) to
compare . . .like
personnel of like
employers
of similar size on the West coast of the United
States."
The police forces of Santa Clara and Orange Counties are
not
responsible for law enforcement in incorporated jurisdictions
and
use of data that ignores this fact is patently erroneous in
determining
comparability.
Further, contrary to the statement contained on page 7
of his
opinion, the County did not argue that San Mateo County
was
comparable to King County. The San Mateo
County police force
serves
only 81,000 citizens and is dissimilar on most of the
other
demographic indicators.
2. Improper and
inconsistent definition of comparable wage
data.
While the sole issue before the arbitration panel was
the
amount by which base wages are to be increased for 1985, con-
sideration of total compensation is absolutely
essential to a
reasonable
and responsible determination of base wage changes.
If total compensation is not
considered, the true value of the
wages
being compared is highly distorted for both employers and
employees
from a total, not singular, perspective.
The Neutral Arbiter, at least twice, clearly implies
that
base wages are "solely at issue (p.
11 and p. 27) in these
proceedings
and suggests that total compensation ought not to be
considered. This approach clearly violates RCW
41.56.460(c) and
(f) where
consideration of "wages, hours and conditions of
employment"
are specifically required in making a "determina-
tion".
Further, the Neutral Arbiter was inconsistent in applying
his
definition of wages, suggesting, on the one hand, that base
wages
only are at issue and that therefore "he must ignore.
participation.
. .in the Social
Security system" (p. 13),
but
on
the other hand, amending base wages in comparable California
jurisdictions
by adding "Pers pickup."
Arbitrarily, the Neutral Arbiter includes PERS pickup as
a
"fact of life" but excludes two other "facts of life",
social
security
and total pension costs, from consideration.
The
Arbiter has been inconsistent
in his evaluation and comparison of
wages
and compensation and unfaithful to the requirements of RCW
41.56.460.
3. Improperly
compared wages.
The Neutral Arbiter's analysis of the wages in com-
parable
jurisdictions lacks defensible rationale.
Why he chose
to
make three comparisons of base plus incentive pay wages is
unclear. To give maximum incentive
pay equal weight in comparing
wage
rates without any data to determine how many police officers
have
master's degrees and/or advanced post certificates, we
believe
seriously overstated the appropriate adjustment. The
analysis
also overlooked the fact that the County police longe-
vity plan will result in an additional 1% wage
rate increase in
1985. Applying the PERS pickup average to average
incentive pay
(Methods 2 and 3) when in
Orange County it is applied to base
wages
is a clear error. This error
artificially inflated the
differences
in compensation between King County and California
jurisdictions
used by the Neutral Arbiter.
Thus, aside from the Arbiter's failure to compare total
compensation
packages, he has arrived at his determination by
comparing
partial compensation packages that are apples and
oranges.
4. Treatment of
PERS Pickup
While the County acknowledged in arbitration proceedings
that
some of the "comparable" California jurisdictions over the
past
ten years had picked up a portion of the employees' retire-
ment system contributions (PERS Pickup) in lieu
of cost-of-living
increases,
it was the County's position that total employer pen-
sion system contributions should be factored
into an analysis of
comparable
compensation per the requirements of RCW 41.56.460.
The Neutral Arbiter chose to
ignore total employer pension system
contributions
for the stated reason that to do so "would automa-
tically distort the base wage rates being paid by
the other four
comparable
jurisdictions to their law enforcement officers" (page
12).
The County acknowledged in the arbitration proceedings
that
total employer pension system cost comparisons could be
inappropriate
if contributions included or excluded funding for
amortizing
individual pension system liabilities.
The County
suggested
in the proceedings that given our inability to determine
how
employer pension costs were affected by amortizing pension
system
liabilities, and given the fact that the pension systems
being
compared were basically comparable (all provided for
retirement benefits
at age 50 for most employees on a 2% per year
of
service formula), the appropriate manner in which to reflect
the
PERS Pickup adjustment would be to compare net employee pen-
sion system contributions. Net employee retirement system costs
for
the four ''comparable" jurisdictions averaged 3.29%. Net
employee
pension system costs for the King County police averaged
6.95%,
a difference of 3.66%. The
appropriate adjustment to base
wages
was 3.66%, not 6.94%. Why the Neutral
Arbiter failed to
even
acknowledge the County analysis in his opinion and award is
hard
to understand. More than that, use of
the larger number
seriously
and erroneously overstates any adjustment which might
be
considered appropriate under the comparability analysis.
Finally the 6.94% average PERS Pickup adjustment used by
the
Arbiter fails to account for the fact that the value in terms
of
compensation is not equal to the PERS Pickup adjustment used
by
the Neutral Arbiter. Employees who
terminate do not receive
employer-paid PERS
Pickup contributions. This fact accounts
for
a
reduced cost to the employer and a reduced value of the pickup
to
the employee, a point we raised in arbitration proceedings but
which
was not dealt with by the Arbiter in his analysis and deci-
sion.
5. Ignoring
the value of social security coverage provided
to
King County Police Officers seriously distorting the wage com-
parison.
The County's careful and exhaustive analysis of the
value
of the social security benefit purchased jointly by the
employer
and the employee demonstrated the compensation enhan-
cement
which comes with that benefit even when the contribution
of
both employee and employer are considered.
Other arbiters (including the 1977 and 1978 Sinclitico
King County Arbitration
awards) did account for the value of
social
security. Contrary to his statement on
page 13, that fact
was
evidence in the record and was either missed or ignored by
the
Neutral Arbiter.
The employer, both at the hearing and in executive
sessions
of the panel, indicated that there were no~supplemental
benefits
replacing social security in other California jurisdic-
tions. In
fact, the employer pointed out that in the only other
comparable
jurisdiction providing social security coverage,
Sacramento County, retirement
benefits are reduced (coordinated)
with
social security benefits. This is not
true for King County
police
officers.
The Neutral Arbiter did not appropriately value social
security
contributions and benefits. Instead, he
substituted his
own
speculation on future federal policy decisions to discount
the
value of this aspect of compensation.
Use of speculation as
to
possible future changes in the social security system and its
benefits
by the Neutral Arbiter as part of the basis for his
decision
to ignore social security flies in the face of the
requirement
in RCW 41.56.450 to base his decision on the evidence
in
the record. There are social security
benefits today. There
have
been social security benefits for nearly 50 years. It is
not
within the purview of the Arbiter's charge to forecast future
changes
in federal policy and budget decisions.
6. Ignoring
Comparable Cost-Of-Living Data.
The Arbiter completely ignored differential costs of
living
among jurisdictions, dismissing on page 15 as "greatly
flawed"
the difference shown in the study and report of the
Runzheimer
Co., a firm providing this kind of service for nearly
twenty
years to the nation's leading corporations and upon which
information
these corporations base their pay plans.
To ignore differential costs of living, particularly
between
Washington and California jurisdictions, when attempting
to
compare wages not only distorts the comparison, it renders it
meaningless. Police salaries in California reflect higher
costs
of
living. That is intuitively correct and
empirically true.
The Neutral Arbiter ignored
this fact, choosing to accept the
opinion
of the Union advocate over the hard evidence of years of
use
by leading private sector corporations of area differential
cost
of living studies provided by Runzheimer.
Specific concerns the Union raised regarding the
Runzheimer
analysis were addressed in detail by the County at
both
the hearing and in the County's post-hearing brief. The
Arbiter even expressed his own
intuitive feeling that there was a
difference
in the cost of living between California and
Washington. The omission of this consideration is another
serious
flaw in the Arbiter's assessment of comparability of cir-
cumstances among jurisdictions.
Summary and Conclusions
Had the Neutral Arbiter properly applied RCW 41.56.460
and
dealt
with the evidence in the record, the appropriate increase
would
have been in the range of 2.5 - 3.5%.
This range would have been obtained had the Arbiter:
1. Taken into account the 2.86% increase in the Seattle
area CPI-w
2. Taken into account a comparison of Seattle and King
County comparative compensation
3. Made adjustments in California PERS Pickup on the basis
of net employer pension system
contributions
4. Acknowledged at least some value of the County's social
security contribution and
differences in costs of living
between California jurisdictions
and the cost of living
in King County or chosen to use
San Diego and Sacramento
Counties as being most comparable to
King County.
For the reasons stated above I vigorously dissent from
the
6%
award.
James
R. Anshutz
King
County Partisan Arbiter