Layoffs, Furloughs, Demotions

Troubled Waters Indeed: All of us in public sector labor and employment are in the midst of navigating through unprecedented and tumultuous waters. Never before have public employees, especially peace officers faced such daunting economic challenges.

With the onset of a national recession, exacerbated by a dysfunctional state government which cannot seem to pull together a political compromise on the state’s budget, labor associations, and those of us who advocate for and represent public safety employees, need to be vigilant and thoughtful in protecting our members’ interests.

In my career, I never envisioned a scenario where peace officers would be facing serious threats of layoffs and demotions. Frankly, that day is upon us. However, while many local municipalities and districts face serious economic challenges, some remain fairly unscathed in the blistering attack on revenue sources.

Many labor associations are facing ongoing MOU negotiations where the structural integrity of long-sought-after benefits are in play. Moreover, while many associations have closed contracts, the employers are initiating discussions to extract concessions and/or modifications.

While the majority of local governments are, in fact, reacting in ways which are, for the most part, reasonable, there are some who ascribe to the theory that now is the time to extract contract concessions – whether they are needed or not.

It is the responsibility of each labor association to determine the legitimacy of an alleged economic crisis before pulling back on hard-fought economic advances.

Fiscal Accountability – Verify! “Fiscal accountability” should be the cornerstone of negotiations in this era of economic downturn. Labor associations are well-advised to conduct financial/economic analysis of their local government employer in an attempt to ascertain the agency’s true ability to pay wage and benefit packages.

Over the last few months, we have experienced the harsh reality of many jurisdictions truly suffering from a significant loss in revenues. For the most part, most of our association clients have been shielded from layoffs and forced demotions. However, when it appears that the employer is in need of relief, the labor association must base any economic decisions on facts and not speculation.

Seek out experienced, independent local government finance experts and consultants who assist labor organizations in ascertaining the true financial condition of the employer. While many employers raise the Vallejo bankruptcy as a doomsday scenario, the Vallejo situation is extremely rare. Do not blindly accept the Vallejo situation as your crisis point.

We encourage all associations – whether they are faced with threatened layoffs, the impasse at negotiations, or simply confronting government leaders who are nervous about the economy – to stay the course and be thoughtful in responses. Many agencies are experiencing financial challenges, yet others have vibrant local economies and labor associations that are relatively assured of getting through this temporary economic downturn without significant concessions.

Know Your Legal Rights Concerning Your Economic Benefits: When dealing with the consequences of this economic situation, there are a number of legal and collective bargaining issues that you must be aware of if you’re considering any type of economic concessions. Those concessions may be requested during the term of an existing contract or during MOU negotiations. The laws concerning a municipal employer’s obligation to abide by negotiated contracts and refrain from breaching those agreements are now being tested at various agencies.

Some agencies are using the economy to engage in alleged cost-cutting missives such as modifying shift schedules. The attempt to change shifts raises potential MOU and meet-and-confer issues.

Do not accept at face value the notion that an employer can modify working conditions in an economic crisis. Protect your MOU and your rights under the Meyers-Milias-Brown Act (Government Code Section 3500 et seq.).

Employers have mandated legal obligations to meet and confer on layoffs. Recently, a California court determined that the decision to layoff public safety employees is not subject to meet and confer. (IAFF Local 188 vs. Richmond 172 Cal. App.4th 265 (2009)) There are, however, exceptions to the rule. In any event, the employer must meet and confer on implementing any decision to layoff.

Moreover, if the issue of “furloughs” arises, the employer must meet and confer on such decisions. Failure to assert meet and confer rights will have devastating consequences.

In addition, there are very specific items that should be addressed by the association in such meet-and-confer sessions. Finally, agreeing to “meet and confer” when not required to do so could permit the employer to reopen an existing MOU. Such a turn of events could lead to a forced modification of the MOU.

Contracts are negotiated and enforceable, and unless the language in those MOUs and side letters permits an agency to force a reopener, there are legal safeguards which should be invoked. If the employer is attempting to circumvent the MOU and force changes in working conditions or benefits, consult with legal counsel immediately.

Be aware of your legal rights prior to committing your association to short or long-term concessions.

Establish a Game Plan – Your Members Will Demand It: Whether you’re in MOU negotiations or responding to an overture by the employer to make mid-contract concessions, always establish a game plan with the thought of securing membership approval. In many situations, concessions or compromises may be perfectly appropriate and completely justified.

In some cases, the association membership may be perfectly willing to accept concession bargaining. However, in many cases, the membership may not be completely informed on the many issues associated with the economic downturn and the impact on local government revenues and will require a showing of due diligence by the association leadership.

When facing the current economic climate and the prospect of concession bargaining, every association should establish a game plan, which should include:

• Verification of the employer’s financial ability to pay.
• Review negotiations with other bargaining units.
• Review efforts undertaken by the employer to mitigate its economic situation.
• Consider comparable agencies and local jurisdictions relative to concessions.
• Set priorities for non-economic enhancements.
• Take careful consideration of the long-term impact of any concessions.

In the final analysis, whatever the result of your negotiations, the membership will ultimately have to have their say. Be organized, thoughtful and prepared.

Conclusion: As most associations are aware, in some cases it is entirely appropriate to consider concession bargaining. However, before adopting a defensive “concession” mentality, develop strategies and safeguards to ensure that minimal damage is done to your members’ economic benefits.

Local revenues are in a constant state of flux and the national and state economies are presenting significant challenges. Be prepared to defend your contract and your members’ benefits—develop a plan of action!