By Jim Cline
This is the seventh and final article in a series of articles on recent Interest Arbitration decisions. A summary of all recent arbitration decisions since 2008 is available on the Premium website. This is a decision by Arbitrator Timothy Williams involving Port Angeles Police. The award was issued in April of this year.
The parties arbitrated three issues: Wages, Insurance, and Education incentive. The Police Officers are represented by the Teamsters.
Comparables. The parties agreed on Tumwater, Wenatchee, Aberdeen, Camas, Oak Harbor, and Anacortes. They disagreed on Centralia and Mountlake Terrace. Without detailed analysis, the Arbitrator agreed to add those two cities in light of “population, assessed valuation, and assessed valuation per capita.”
Wages. The Arbitrator noted that the parties had agreed to only increase wages by 2% for 2013 and 2014. The dispute centered on whether the Union would also receive 2% for 2012 or whether the wages would be frozen. The City argued that other City employees had their wages frozen for 2012. The Teamsters argued that they had already agreed to freeze wages for 2011.
The City argued it was under fiscal distress, which had included layoffs. The Union replied that only 2 employees out of the 230 employee workforce had been laid off. Considering all the competing arguments, Arbitrator Williams concluded the Officers should receive 2% for 2012, as well as the other two agreed upon years.
Education incentive. The Officers had a premium of $56 per pay period for an AA and $85 per pay period for a BA. It proposed to increase the premiums to 3% and 4% and to add a new MA premium of 5%. The contract did not explain how long a pay period lasted. The Arbitrator ordered the premiums be set at 2% for an AA and 4% for a BA, with no new Masters premium. The Arbitrator acknowledged that the 2% AA premium might be a reduction from the current $56 per pay period for some officers, so he added a grandfather clause to maintain the $56 until an Officer’s wage at 2% exceeded that amount.
Health insurance. The City currently pays 91% of the premium on an apparent composite rate plan. The City wanted to increase the employee contribution from 9% to 11.5%. The Teamsters also proposed to increase the employee contribution, but to 10%.
The health insurance discussion is one of the more peculiar aspects of this Arbitration. It is noteworthy that the Teamsters proposed to increase the premium by one percentage point and simply opposed the rate going up by two and a half points. Perhaps there was some tactical planning at work, though the 9% on a composite rate already means that employees are paying not just 9% of their dependent premiums, but also 9% of the employee only coverage. So it is unclear why the Teamsters would propose increasing the rate.
Another conspicuously omitted discussion in the Award concerns the timing of the rate increase. Per the recent court ruling on the retroactive Kitsap County premium increase, retroactive increases are deemed unconstitutional. The decision is discussed here. The Supreme Court has indicated it is accepting review of that decision. The legal and constitutional issues involved are discussed in a recent blog article I have written. If the Port Angeles Officers were forced to accept a retroactive increase in their premium, then there may be legal issues surrounding that.
This is another decision that reflects the folly of accepting a one or two year wage freeze, without a back end compensatory increase, with the hope (and no firm commitment) that the City will later make it up. Increasingly such one-sided deals end up later causing an arbitration due to the mismatch in expectations when the employees belatedly learn the employer never intended to “make it up.” (If they had, wouldn’t they have offered it at the time of the wage freeze offer?)
