Los Angeles Mayor Antonio Villaraigosa and his top budget advisers thought they negotiated a labor contract last week that would begin to address the steadily rising cost of employee healthcare benefits.
But that deal, reached with the 4,800-member Engineers and Architects Assn., has come under attack from members of another civilian employee union, which contends that the agreement contains “unprecedented and dangerous” concessions and should be rejected.
With the Engineers and Architects voting on the tentative agreement this week, organizers with Service Employees International Union Local 721 have begun warning that the proposed pact is part of a larger effort to “divide and conquer” the city’s civilian employee groups.
“You shouldn’t have a small set of city employees setting a precedent for the city employees as a whole,” said John Hawkins, a member of the SEIU’s bargaining team, which is in talks on behalf of nearly 2,000 other city workers.
The fight shows the political challenges city officials face as they attempt to rein in employee benefit costs. Healthcare costs for city workers are expected to jump from $361 million to $514 million over a five-year period, according to budget analysts.
As it battles a continuing budget crisis, the city has already found it necessary to shed thousands of employees, using early retirement, layoffs and other strategies to trim the workforce.
With vote-by-mail balloting scheduled to end Friday, e-mails critical of the proposed agreement have been issued by the SEIU Local 721 Action Center. Meanwhile, fliers featuring a dissident member of the Engineers and Architects Assn. have been distributed in city buildings with a warning that the new agreement will force the union’s members to “retire into poverty.”
Under the proposed pact, workers in the engineers’ union would pay $20 per doctor visit, up from $10. Its workers would no longer receive $15 per month to enhance their life insurance and disability insurance. And union employees would pay 5% of their monthly healthcare premiums, according to city officials.
Civilian city workers who rely on Kaiser Permanente currently pay nothing toward their premiums.
In exchange, the city agreed to reduce the number of furlough days from 26 to 10 in the current budget year.
The mayor’s Deputy Chief of Staff Matt Szabo said Monday that the city would continue pushing for each civilian employee to cover 10% of the costs of the city’s monthly health premiums. If the deal is rejected by Engineers and Architects Assn., the city would seek to impose such changes on those workers unilaterally, he said.
“Any move by one union to interfere with the negotiations of another union will ultimately backfire,” Szabo said, “because the city is likely to impose these healthcare provisions and more on those who opt out of the deal.”
Michael Davies, interim executive director of the Engineers and Architects, said the Service Employees International Union is opposing the deal as part of its push to raid his union’s membership. Last fall, nearly 2,000 workers from his organization moved to the SEIU.
Davies portrayed increased healthcare contributions as inevitable, not just for his members but for other civilian city unions.
“Virtually everywhere in the private sector, and increasingly in the public sector, quote-unquote free healthcare coverage has either disappeared or is disappearing, simply because it’s not sustainable,” he said.
Critics of the Engineers and Architects contend that Davies rushed into a new agreement to avoid having more members lured away. Until an agreement is approved, members can opt to leave, Hawkins said.
The Engineers and Architects contract expired June 30. Since then, the union has come under fire for signing a letter saying that it is not “categorically opposed” to a larger contribution toward its retirement benefits in coming years.
In addition, some employee bonuses will not be included in pensions for the group’s workers, according to the proposal.
Miguel Santana, the city’s top budget analyst, said the average worker represented by the Engineers and Architects would still see a $56,000 annual pension, plus an automatic 3% annual cost-of-living increase and free healthcare, once he or she retires. “That is not poverty,” he said.