The Los Angeles City Council on Tuesday finalized a salary deal with the powerful union that represents Department of Water and Power workers, obtaining a hike in the retirement age for future employees and no pay increases for three years.
The pay pact is part of a much larger agreement to settle a three-year-old lawsuit filed by DWP union representatives over the utility's practice of hiring hundreds of employees from other city agencies. But the city could wind up trading one legal battle for another.
Six labor unions whose members don't work at the DWP said they would press ahead with a challenge to parts of the deal that scale back retirement benefits for city workers who hope to get jobs at the utility in the future.
More than 1,600 workers in various city departments moved to jobs at the DWP between 2004 and 2010, many of them during the recession, hoping to escape the threat of layoffs in their previous jobs. Those transfers forced ratepayers to absorb an additional $183 million in retirement costs.
The latest labor fight highlights just how coveted DWP jobs are: Even the unions whose members who don't work at the utility are fighting the reduction in benefits planned at the agency.
The Coalition of L.A. City Unions contends that its members continue to have a right to the pension benefits given to city workers who get jobs at the DWP. Those benefits cannot be changed without full negotiations, the group's lawyers contend.
City Administrative Officer Miguel Santana said the settlement approved Tuesday locks in changes to rules regarding DWP transfers. If those provisions are removed the entire deal will unravel, he said.
"If [the coalition's] goal is to go back to a situation where city employees can transfer to the DWP and have the ratepayers absorb the additional pension cost, that cannot be done," Santana said.
Coalition chairwoman Cheryl Parisi said council members were "misguided" when they agreed to put new financial barriers to city employee transfers.
"These changes will have a highly detrimental impact on workers," she said. "Employees who promote or transfer through the city's civil service system shouldn't be penalized, and that's the end result of this action."
Mayor Eric Garcetti and the city council announced that the DWP deal had been struck in August, trumpeting provisions that are supposed to save $415 million over the next four years, in large part by eliminating pay increases. No raises would occur until Oct. 2016, when a 2% pay hike would be awarded. The agreement would pare back pension benefits for DWP workers hired after Jan. 1.
The coalition sent a letter last month calling on the city's leaders to cease and desist from imposing elements of the DWP deal that would affect future employee transfers. Since then, coalition leaders warned they would take "all necessary actions" to protect the benefits that are in place now for their members.
While DWP employees gave up raises this year, the coalition had two increases scheduled. The group's members received a 1.75% boost in July. On Jan. 1, the group of six unions will get another 5.5% pay hike.