City of
And
International
Association of Fire Fighters, Local 3482, IAFF, AFL-CIO, CLC
Interest Arbitration
Arbitrator: Howell L. Lankford
Date Issued:
Arbitrator:
Lankford; Howell L.
Case #: 16378-I-02-00382
Employer:
City of
Date Issued:
In the Matter of
the Interest Arbitration
between International Association of
Firefighters, Local )
3482, IAFF, AFL-CIO,
CLC (“Association”) )
) Findings,
and ) Discussions and
) Award
the City of
)
______________________________________________________)
Case Numbers:
Arbitrator's
case No. D5D
Representing the James H. Webster;
Lynn D. Weir; and Webster
Association: Myak & Blumberg,
98101
Representing the Karen Sutherland
and
City: P.C.L.C.,
WA
98101-1686.
Arbitrator: Howell
L. Lankford, Esq.,
Hearing held: In the
City’s offices in
Witnesses for the Michael Yoakum,
Jeff Bohnet, Ed Krikawa,
and
Association: Blake Engnes
Witnesses for the
City: Carol Wilmes, Rich Leahy, Jack Colbath,
and Cabot
Dow.
Post-hearing
argument From both parties on
received: postmarked on or before
Date of this
award:
This is an
interest arbitration under RCW 41.56.430 through RCW
41.56.490. The
issues are salaries and insurance benefits. The parties agree that
there are no preliminary issues of
substantive or procedural arbitrability and the
preliminary statutory steps have been
properly completed. The hearing was
orderly. Both parties had the
opportunity to present evidence, to call and cross
examine witnesses, and to argue the
case. Both parties filed timely post-hearing
briefs and offered me 60 days from
receipt of the briefs to issue this award.
The City has a total of about 82
employees; and the Department consists of
16 employees: 13
in the bargaining unit, a Chief, an Assistant Chief, and a civilian
assistant. The City has three other
bargaining units-Police, Office/Technical
Professional
employees, and Public Works/maintenance-all represented by the
Teamsters
the Harbor Point area. Two years
later, it changed from an all-volunteer Fire
Department to its present part-paid-part-volunteer configuration. The Association
was organized and bargained its
first contract in 1993.
The proposals. The Association
proposes a 6% increase (2% plus the June
CPI-U), effective
retroactively to
year increases of the 2% over CPI-U1
on January 1 of 2003 and 2004. The
proposes to delete the current temporary
cap language in the insurance article but
to leave the (uncapped) AWC Plan A
insurance benefits otherwise unchanged.
_____________
1 The parties do not disagree about which CPI index to use.
The City has two primary concerns in
interest arbitration. First, the City
hopes to control its growing employee
insurance costs by encouraging the
firefighters to change from their current
AWC Plan A to the less expensive AWC
plan B. Second, the City hopes to
limit overall personnel costs to what it can
clearly cover by ongoing revenue
sources without resort to any of the “one-time”
revenues in its current budget picture.
The City therefore proposes two
alternatives: First, if the employees
continue in AWC Plan A, then the City
proposes a 3.7% increase in salary and
an 8% increase in insurance contributions
for 2002 and, for 2003 and 2004,
90% of the CPI-U increases and an additional
8% increase in
insurance contributions. Alternatively, if the employees change
over to AWC Plan B, then the City
proposes a 4.7% increase in salary and a 10%
increase in insurance contributions for
2002 and, for 2003 and 2004, the full CPI-
U increase and an
additional 10% insurance contribution increase. The City also
proposes that the 1992 changes be
effective only from the date of the interest
arbitration award, without retroactivity.
Factors to be considered
RCW 41 56.430 Uniformed personnel - Legislative declaration. The intent and
purpose of chapter 131, Laws of 1973 is
to recognize that there exists a public policy
in the state of
settling their labor disputes; that the
uninterrupted and dedicated service of these
classes of employees is vital to the
welfare and public safety of the state of
should exist an effective and adequate
alternative means of settling disputes.
RCW 41.56.465
Uniformed personnel -- Interest arbitration panel --
Determinations -- Factors to be considered. (1) In making its determination, the
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
consideration the following
factors:
(a) The
constitutional and statutory authority of the employer;
(b) Stipulations
of the parties;
(c)(i) For employees listed in RCW 41.56.030(7)(a) through (d), comparison of the
wages, hours, and conditions of
employment of personnel involved in the proceedings
with the wages, hours, and
conditions of employment of like personnel of like
employers of similar size on the west
coast of the
(ii) For employees
listed in RCW 41.56.030(7)(e) through (h), comparison
of the
wages, hours, and conditions of
employment of personnel involved in the proceedings
with the wages, hours, .and
conditions of employment of like personnel of public fire
departments of similar size on the west
coast of the
adequate number of comparable employers
exists within the state of
west coast employers may not be
considered;
(d) The average
consumer prices for goods and services, commonly known as the cost
of living;
(e) Changes in any
of the circumstances under (a) through (d) of this subsection during
the pendency
of the proceedings; and (f) Such other factors, not confined to the factors
under (a) through (e) of this
subsection, that are normally or traditionally taken into
consideration in the
determination of wages, hours, and conditions of employment. For
those employees listed in RCW
41.56.030(7)(a) who are employed by the governing
body of a city or town with a
population of less than fifteen thousand, or a county with
a population of less than seventy
thousand, consideration must also be given to
regional differences in the cost of
living.
Ability to pay: the financial condition of the City. The City has
come a
long way since it experienced a
major reduction in force in 1995. At that time, the
City was forced to
several desperate cost reduction measures including reducing its
workforce by 13 percent, closing the
library, closing City Hall on Fridays, etc. The
Association was
the first of the City’s empIoyee unions to agree to a
wage freeze.
After major
changes in the local elected officials and in the professional
management, the City adopted a “get well”
fiscal policy which particularly
abandoned any use of one-time income for
ongoing operating costs. On the
revenue side, the City increased its
tax rates the maximum allowed by law and
added hotel and business license
taxes. Personnel growth has been held to a net
increase of five employees since 1995.
The Fire Department has increased by
four, and the Police Department has
increased by three, with resulting reductions
in the City’s workforce elsewhere.
There followed a five to seven year
period of unprecedented economic
growth. There was about $65 million in
new development in 2001 , followed by
(probably) another $25 million in 2002. There are signs that
the growth peak may
have passed, however. Boeing’s
departure will result in a $40-50 million direct
loss to the City’s general h d , not
counting the indirect ‘income losses which will
follow from that departure. There are
now 12 % fewer licensed business in the
City than there were in 2000.
The collective bargaining agreement
which just expired between the parties
took the City out of an FLSA
overtime obligation by reducing employee work
hours by about 8%. Both parties
recognized that change as a wage increase,
although it did not change take home
pay.
The change from the City’s 1995
financial condition has been dramatic. At
the end of fiscal year 2000 the
City had $7.55 in assets for each $1.00 in liabilities;
and the ending balance of the
general fund-which f h d s most of fire department
operations-nearly doubled from N
1998 to FY 2000. Such a change often
reflects conservative budgeting, and for
each of the last three years the City’s
revenues have exceeded budgeted
projections. The unreserved portion of the
general fund balance at the end of FY
2000 was just over $4 million, a remarkable
63% the City’s entire expenditures for that fiscal year. In short, the record here
more than justifies the Mayor’s 2002
Preliminary Budget Message:
This budget also ensures that we
will be prepared to deal with some potentially
difficult times. We have used the past 10
years of strong economic growth to diversify
our tax base, make our operations
more efficient, and to make investments in our
infrastructure so we could
eliminate liabilities and avoid future tax increases. We’ve
been diligent about controlling
staffing levels and have not built in on-going costs that
could not be supported when the
development boom and economic cycle faltered.
When many of our neighboring
communities are faced with budget reductions
and large tax increases, we have
opportunity to maintain our positive momentum.
Comparability. This is probably
one of two fundamental disputes that
drove the parties into interest
arbitration (the other being the choice of insurance
coverage and caps). The parties
generally agree that the primary considerations in
identifying “fire departments of similar
size” are population and assessed
valuation. Using a range of 50% to 200%
i.e. half to twice-the Association
proposes a set of ten urban departments
in King and
City-arguing that
the Association’s proposed comparables include four
departments with twice the paid staff of Mulikteo and one department with four
times the paid state--proposes a
selection range of 50% to 150% of population and
assessed valuation. The City also
proposes to extend the geographic range of
possible comparables to include
and Thurston Counties. The
Association characterizes the resulting proposed.
comparables as reflecting isolated and
rural departments, with lower pay and
longer working hours.
Table 1 sets out the available
comparability data for the departments
proposed by each party (both using data
from the 2001
Directory). Populations are rounded to
1,000s. Assessed values are rounded to
millions of dollars. Distances are taken
from the record when available and from a
commonly used mapping program otherwise.2
___________
2 Distances are obviously approximate and depend on district office
locations. I have
used 54 miles for
Mountain View / KCFD #44-which is officed in
Auburn-rather than the
65 miles shown by the City.
The vast majority of interest
arbitrators in the Northwest over the last 20
years have taken population as the
first factor to be considered in determining
comparables. After population, two factors
are perhaps tied for second and third
place: assessed valuation and
geographic proximity. Certainly any proposed
comparable which is strikingly dissimilar
in respect to assessed valuation, or which
is strikingly distant, is not
likely to be given much weight. That follows, I submit,
from the fact that the interest
arbitration process should be a continuation of two-
party bargaining, and not a foreign
substitute for it. In private sector two-party
negotiations, nobody much expects to make
headway by pointing to other
employers who have very much greater or
lesser resources than the employer at the
table. Similarly, compensation data
is much more impressive if it reflects what
other employees are getting paid for
the same work just down the block and is only
marginally interesting if it reflects what
similar employees are paid somewhere far
away.
**See Table #1,
page 6
* Distance via
ferry.
______________
3. The City sets out a population of
13,000; but the Directory shows an additional 4,300 for the City of
Those first three
considerations-population, assessed valuation, and
proximity-are always applied in
the context of what might be called the “first
imperative of interest arbitration:” The
arbitration panel must resolve the dispute
and must do so within the limits of
the record. If the parties present adequate data
with respect to vast numbers of
other employers, the arbitration panel may be able
to bring all three of the primary
factors into play; indeed, the panel may be able to
indulge in consideration of additional
factors which reasonably distinguish a
comparable jurisdiction. There are many
interest arbitration awards in this region
that resulted from an arbitrator
being forced to accept comparables quite far away,
or somewhat dissimilar in
population or assessed valuation, simply because the
dispute must be decided on the basis of
the record at hand. Thus the fact that an
arbitrator held the appropriate range to
be “half to twice,” or 50% to 150%, is often
a reflection of the record that
the arbitrator had to work with. If a record included
n reasonable number of cornparables within +/- 10% of an employer’s population
and assessed valuation and within a
five minute walk, then those might be
appropriate lines to draw in establishing
comparables in that case; and if the record
requires the lines to be at 200% and a
two hour drive, then those, too, would be
appropriate lines.
Applying those general principles to
the case at hand, some of the
comparables proposed by the Association are
unnecessarily dissimilar to the City
in population, and some of those
proposed by the City are unnecessarily distant.
all barely within the Association’s
proposed 200% limit with respect to population.
its population almost twice the
City’s, so is its assessed valuation. (Departments
with both population and assessed
valuation of more than 15% of the City’s are not
attractive potential comparables.) Of the
City’s proposed comparables,
/ Pierce FD #16 is
70 miles away and on the far side of metropolitan
Tumwater is
similarly situated and is 95 miles away; and
half the size of the City in
assessed valuation.
The closer calls are
-and
Harbor-proposed by the City.
assessed valuation. It lies on the far
side of metropolitan
than
comparable department. On this record,
then,
comparable. Seatac
is slightly larger than Mukilteo in population and substantially
larger (at 164%) in terms of assessed
valuation; and it, too, lies on the far side of
the
without stretching out to include Seatac.
The Association objects to looking
outside of King and Snohomish
counties, and therefore objects to
consideration of the two Kitsap
Districts. The controlling statutory term,
however, is “similar size,” and it would
stretch that term out of all reason to
restrict it to “inclusion in the same statistical
base” as the Association propose.4
The
commute by ferry; but
commuting; and I cannot find that
characteristic is enough to exclude these
otherwise clearly comparable districts.
____________
4. The City proposes to consider
comparability in terms of fire call type and volume.
It seems to me to
be stretching the statutory term “similar size” quite far to pick cornparables on
that basis. Similarly, the City
proposes a historical view of comparability and points out that
Mukilteo would
have ranked below every one of the Association’s proposed comparables (at
top step base rate) every year from
1998 through 2002-and below the average by over 13% in
every year before 2001. But there is
something unsettlingly circular about setting salaries on
the basis of “similar size” and
determining ‘‘similar size” in part on the basis of similarity of
salaries.
The record therefore contains nine
districts of similar size to Mukilteo:
View / King FD #44,
2002 Wages. Once the proper comparators are
established, the next step is
to determine what those
departments pay for fire services. That requires (1)
picking a “benchmark” point in the
salary schedule, (2) determining what factors
are to be included in the total
compensation received (wages, differentials,
incentives, “fringe benefits,” etc.), (3)
determining what factors are to be included
in determining total hours of work
(work schedules, vacation accrual, holidays,
etc.), and (4)
calculating hourly
compensation for all the comparables on a 2001 Net hourly wage
uniform basis. These disputes over the
method of comparison are often a
second
level of comparability disputes,
sometimes
every bit as important as the choice
of Tukwila 25.71
comparable jurisdictions. It is not at all Mountain View/King 44 28.93
uncommon for the parties in an interest Duvall/King 45 23.54
arbitration to disagree over many of these Snohomish
4 27.05
issues. They do in the case at hand.
The Poulsbo/Kitsap
18 23.20
two issues-- i.e. choice of
comparables
and choice of the method of North Kingston/Kit.10 22.78
comparison--cut across one another. In Average 24.57
the best of all possible
worlds-from an Mukilteo 23.06
interest arbitrator’s point of view-each Difference 6.53%
party produces its own proposed
analysis Table
#2
of all the proposed comparables,
i.e. those that it proposes and those that the other
party proposes. As a practical
matter, if only one party produces a record
analyzing both sets of comparables by its
proposed method of comparison, and if
the record does not include the
data necessary to analyze-all of the arbitrator’s
chosen comparators on the other
party’s proposed basis of comparison, an interest
arbitrator may be forced to ignore the
merits of the dispute over methods of
comparison and accept the only point of
view the record provides which has been
applied to all the chosen comparables.5
____________
5. There is, or course, a second,
equally unsatisfactory alternative: the arbitrator may
use only the set of comparables,
proposed by one party or the other, which contains the least
offensive subset, so that a single
pattern of analysis is available for all the chosen comparables.
That approach
seems to me more difficult to defend in the face of the statutory language
which
requires the selection of comparables on
the basis of similarity in size.
In the case at hand, neither party
presented data analyzing all the proposed
comparables-i.e. its own and those proposed by the other side-by its proposed
method of comparison. Moreover, some
of the exhibit data contradicts the
undisputed testimonial record in some
respects. Within those limitations, Table 2
(taken largely from City Book 1 , Tab D6) sets out what seems
to be the best
supported data in the record addressing
all the comparable jurisdictions. It shows
the City to be a bit more than 6.5%
behind comparable departments in total
compensation. The Association’s proposed 6%
for 2002 is therefore supported in
the record even by a comparison of
the wages paid in 2001.
|
2002 Monthly Base |
Annual hours |
Net rate |
|
|
|
4591.00 |
2,478 |
22.23 |
|
|
4808.46 |
2,808 |
20.55 |
|
Tukwila |
4925.00 |
2,632 |
22.45 |
|
/King 44 |
4640.00 |
2,195 |
25.37 |
|
Duvall/ King 45 |
4675.00 |
2,680 |
20.93 |
|
Snohomish 4 |
4765.00 |
2,346 |
24.37 |
|
Poulsbo/ Kitsap 18 |
4505.00 |
2,604 |
20.76 |
|
|
4140.00 |
2,496 |
19.90 |
|
Kit. 10 |
4735.00 |
2,764 |
20.56 |
|
AVERAGE |
|
|
21.90 |
|
Mukilteo, 2001 |
4248.00 |
2,596 |
19.64 |
|
Difference |
|
|
11.54% |
Table #3
Comparing the City’s
current,
2001 hourly wages with
the similar
figures for comparable
departments’
2002 net hourly
rate
produces the figures set out
in Table 3.
(The numbers used
here do not
reflect insurance
benefits
received because
insurance
benefits are analyzed
separately
in the discussion
below.
Insurance benefits
received
are certainly a part of
compensation;
but including
them both
in wage averaging and
again
separately has the effect of
doubling
their significance in the
analysis.)
The figures show quite
plainly
that the Department will
still
fall short of coming up to the
average
rate paid in comparable
departments,
even with the
Association’s proposed
6%
increase
in the first year of the
new
contract.
2002 Insurance.
There is no dispute in the record that the Department’s
current AWC Plan A coverage was
originally designed to provide LEOFF I, “first
dollar” medical benefits. The primary
differences between AWC Plans A and B
are increased deductibles under
Plan B ($100 individual and $300 family rather
than $50 / $150)-though with the
Same $370/$1,125 stop loss limit-and the
addition of a 20% copay
for hospital and for many substantial medical costs under
Plan B.
The City points out that the
Association’s insurance proposal would make
the City virtually unique amongst
the comparable departments. In particular,
2002. That
department pays 100% of employee premiums but only 90% of family
medical. Tukwila now pays 100% of
insurance costs but has a 12% cap on annual
contributions. In
a January, 2002, interest
arbitration award. That department pays 100% of the
PPO plan premium
and half the difference for employees who prefer the more
expensive WFCA Traditional Plan. Duvall /
King FD #45 puts a 15% cap on
increases in district insurance
contributions.
In short, there is no way to avoid
the City’s conclusion that 100% employer
paid, open panel, “first dollar”
insurance plans, with virtually no co-payments, do
not represent the comparable
average insurance benefit for this bargaining unit.
As Arbitrator
Wilkinson (NAA) noted in her January, 2002, decision in UFF,
Local 3816 v. King
County Fire District 44-a department which both parties here
offer as comparable-“The
coverage, which no longer is a viable
position.” The
proposing 100% full family coverage under
the WSFCA traditional plan, which is
substantially inferior to even the
AWC Plan B which the City hopes to bring this
bargaining unit into.
The City has added caps and reduced
insurance coverage costs for its three
other bargaining unite.6
The police unit accepted an 1 1% first year cap on
what
the City reasonably describes as
the Teamsters “Cadillac” insurance play and 10%
increase caps for each of the second and
third years, along with a 4.6% first year
increase and 100% CPI increases for the
next two years.’ The Office/Technical
employees switched from AWC Plan A to Plan
By accepted a 10% per year
insurance increase cap for all three
years of the contract, and got the Same CPI
increases as the police officers. The
Public Works/Maintenance employees
contract has the same pattern as the
Police unit contract, with a different Teamsters
insurance plan and a 4.2% first year wage
increase.
___________
6. The City is certainly correct in
arguing that settlements with other bargaining units
of the same employer is another
factor which is “normally or traditionally taken into
consideration in the
determination of wages, hours, and conditions of employment.”
The Police bargaining unit set the
cap for the Firefighter unit-at least
temporarily-under a Section 11.3 of the
prior contract which provided:
* * * Nothing
herein shall be interpreted to require the employer to pay any additional
insurance premium increases beyond the
term of the existing contract, provided,
however, for the period between
concluded for a new agreement, the
insurance premium as it pays fur
employees in the Police bargaining unit and receive
the same benefits as employees in
the Police unit; and the parties may agree, in
accordance with their bargaining rights
and obligations, to a retroactive date for future
agreed upon wage and benefit increases
in accordance with RCW 41.56.950.
Under that
language, the Department has paid $673.05 per month of the total
cost-$755.08-leaving the employees
with an $82.05 per month out-of-pocket
cost.
The Association argues, however,
that insurance is fundamentally a part of
compensation, that the employer’s primary-if
not sole legitimate-concern is
premium cost and not choice of carrier
or benefits, and that it makes more sense
for an employer to pay insurance
premiums with pre-tax dollars than for the
employees to pick up the same amounts
with after tax dollars. The City does not
dispute that insurance is fundamentally
a part of compensation. Indeed, the City
particularly stresses what a major personnel
cost insurance has become,
particularly in the face of the frightening
20+% increases in AWC rates for this
year. And there is no dispute that
medical costs-including premium costs-paid
by employees must be paid in after
tax dollars whereas those same costs, if paid by
an employer, are paid in pre-tax
dollars.
Even though insurance benefits are
certainly a part of employee
compensation, that special part is tied to
insurance costs, which are generally
imposed by a third party.7
It is traditional, therefore, for collective bargaining
agreements to set out separate down-year
escalators for base pay, on the one hand,
and for insurance benefits, on the
other. The Association does not suggest any
such statement of insurance benefit
increase, of course, because the Association
proposes no limit to the insurance
benefits the City would be obligated to pay.
_____________
7. Self-insurance is the obvious
exception. Tukwila offers an excellent example of the
additional option presented by self-insurance.
There, the parties have agreed to reopen
discussions of the benefit levels if the
costs increase by more than 12% per year. Under the
usual, third-party-provided insurance
plan, that option is not available.
Table 4 sets out an estimate of the
2001 insurance benefits received by
employees of the comparable
jurisdictions. The record in this respect is very far
from clear. I begin with the one
very clear fact that these employees now receive
City insurance
contributions of $673.05 per month and have $82.05 per month in
out-of-pocket costs, for a
total of $755.08 per month in insurance costs. There was
no doubt at all about those
figures in the testimony at hearing. But I have searched
the record in vain for data built
around a current insurance benefit of $673.05.
Moreover, the
record contains substantially different numbers for two of the
mutually agreed comparables, Snohomish
Fire District #4 and
King Fire District #44. Because the
Association set out component costs, and
because the CBAs
for those departments- which are in the record-show 100%
insurance payment for 2001 , I have used
the Association’s numbers for those
|
Insurance Benefits |
||
|
|
2001 |
2002 |
|
MountlakeTerrace |
642.51 |
459.6 |
|
|
630.53 |
759.67 |
|
Tukwila |
881.24 |
986.29 |
|
King 44 |
829.46 |
790.73 |
|
Duvall/King 45 |
761.32 |
909.36 |
|
Snohomish 4 |
706.88 |
944.67 |
|
Poulsbo/ Kitsap
18 |
681 |
809 |
|
|
601 |
558 |
|
North
Kingston/Kit. 10 |
673 |
809 |
|
Average |
711.88 |
814.04 |
|
Mukilteo
(current) |
673.05 |
673.05 |
|
Difference |
5.8 % |
20.9 % |
Table # 4
departments.
The 2002
comparable
insurance benefit
figures are
also in the record and
are set out
in Table 4. They
show that
the average insurance
benefit
received by the
employees
of comparable
districts
in 2002 are 23% over
the benefits
paid by the District
throughout
that year while this
interest
arbitration was pending.
That requires a
2002 insurance
benefit
award of the entire
755.08 cost of insurance,
including the AWC Plan A
coverage.
(Because this award
will issue
at the very end of
2002,
there is no issue of the type
of coverage which the employees
should have
for the first year of
the new
contract. What they
actually
had was AWC Plan A.)
Retroactivity. The City
argues that the award in this case
should not be retroactive. As
indicated above, the City’s actual
contributions for insurance have been capped at
the police unit rate during the
course of negotiations and the pendency of this
interest arbitration proceeding. The
contract language which capped the insurance
benefits explicitly makes that cap
tentative and subject to the subsequent award in
interest arbitration. The question then
is whether there is a good statutory or
policy reason for withholding
retroactivity. The City points to no statutory basis
for such a proposal. And the cited
policy reason comes down to the desirability of
having the collective bargaining come
to a timely conclusion. The City’s
frustration with the protracted bargaining
process leading up to this case is
certainly understandable, particularly in
light of the fact that another interest-
arbitrable bargaining unit
settled its contract in a timely manner. But the
legislative statement of policy seems to me
to weigh heavily in favor of
retroactivity. Interest
arbitration is designed to be an “ effective and
adequate
alternative means of settling disputes,”
and what interest arbitration is an
alternative to is resort to a strike. In
the private sector, “no contract, no work” has
been a battle cry of organized labor
throughout much of its history. In order to be
an effective alternative to a
strike, therefore, interest arbitration must ordinarily
offer the
same result by reaching back to make up wage and benefit increases
retroactively. Nothing in the
record here provides compelling support for the
City’s proposal to make this case an exception to that general
rule.
Subsequent years wages and insurance. The
parties agree that this
contract should run through 1994. The
wage and insurance increase provisions for
the comparable departments are set
out in Table 5.
|
|
CBA term |
Subsequent years
pay |
Subsequent years
insurance |
|
|
2002-2003 |
90% CPI (set out
as 3.51% for |
City's choice of
carrier ("substantially the same level of cost-containment [coverage]"). 100% employee & 90% dependents. |
|
|
2001-2002 |
5.5% (2002) |
$50 per month
out-of-pocket limit (Contract does
not specify plan.) |
|
Tukwila |
2002-2004 |
90% of CPI
(2.5-4%) |
Self insurred. 12%/year. Reopen to adjust benefits
over 12% |
|
|
2001-2003 |
6% |
(IA award) 100%
of WSFCA PPO+ half the
difference if employee chooses traditional plan |
|
Duvall/King 45 |
1999-2002 |
CPI (2-5%) each
1/1/ |
WSFCA for 100%of
employee. Dependents capped at 15% for life of agreement. |
|
Snohomish 4 |
2001-2003 |
(3-5%) |
WSFCA 100% |
|
Poulsbo/Kitsap 8 |
2002-2004 |
4% |
Self insured
(100% PPO or 80% outside. % of dental.
Limited vision benefits). |
|
|
2001-2003 |
|
Self insured
(100% PPO or 80% outside. % of dental.
Limited vision benefits). |
|
|
2000-2002 |
'01 & '02:
CPI (minimum 3.5%) |
AWC, WSFCA
"or equivalent" at 100% |
Table
# 5
Only one of the comparables exhibits
a later-year wage increase of less
than the full CPI (as the City
proposes); and the most common approach is a 100%
CPI increase
within the 3% to 5% range. Despite the City’s commendable
reluctance to incur potentially long-term
operational costs which cannot clearly be
met by on-going general fund
revenues, nothing in the record justifies holding the
firefighters to a wage rate which is
substantially less than that received in
comparable jurisdictions. Because these
firefighters start-out almost 11.5% behind
(comparing their 2001 hourly rate to the 2002 average as
shown in Table 3), there
is no good reason to reject the
Association’s proposal that the 2003 and 2004 wage
rates each increase by 2% plus 100%
of the change in the
CPI-U.
Turning to insurance for the second
and third years of the new contract, an
examination of the cornparables
does not provide much help. Even this small
sample of jurisdictions suggests the
variety of responses to rising insurance costs
that are now common. To repeat,
however, none of the cornparables provides for
100% of increases
in the cost of a first-dollar-no-copay plan
equivalent to AWC
Plan A. Even in
the face of more limited coverage, only three of the nine
cornparables cover the entire
cost of insurance premium increases over the life of
the CBA. I therefore agree with the
City that the subsequent years’ insurance
benefit must be measured by the dollar
premium cost increases in the AWC Plan
B, with the
employees picking up any additional costs of Plan A
coverage out of
pocket. I do not award the City’s
proposed change to Plan B coverage; but if the
employees prefer to continue Plan A
coverage, they must make up the difference in
premium cost increases-Plan A costs
increased more than Plan B costs last year
and can probably be expected to continue
to do so-themselves. The final
question is whether there should be a
percentage cap on those increases. Because
only two of these comparables have
percentage caps of any sort, I cannot find an
adequate basis in the record for such an
award, even though the City’s proposals
may well be the wave of the future
in public sector CBA insurance provisions.
The City argues convincingly that
these firefighters have already made
significant gains in terms of real dollars
in recent years, as shown by comparing
unit wage and insurance increases
with changes in the CPI. But the record
strongly suggests that that would be
true of employees of the comparable
departments as well. Considerations of the
changes in the cost of living do not
militate against the increases which are
demanded by comparison with comparable
fire departments.
Finally, the City proposes to
continue the “me-too” temporary insurance rate
cap from the prior contract. There
is no doubt that the parties would be better off
if they could complete
negotiations of the next contract before the end of 2004,
and toward that end, I will award
the continuation of that provision.
AWARD
The award for the first year is
retroactive to January 1, 2002. The wage
increase for 2002 shall be 6% on the base
wage. The City’s insurance contribution
shall be the entire $755.08 of the
actual premium cost for 2002. The wage
increases for 2003 and 2004 shall be 2%
plus the June CPI-U increase in each
year. The City’s insurance premium
contributions in 2003 and 2004 shall be the
prior year’s contribution plus the
dollar increase in the equivalent premium costs
for AWC Plan B coverage, and the
remainder of the Plan A premiums shall be paid
by the firefighters. The language
of Section 11.3 shall continue into the new
contract, with the date in question
changed to 2004.
Respectfully,
Howell
L. Lankford
Arbitrator