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Public sector unions made most concessions in contract negotiations

ANN ARBOR—Local government leaders in Michigan report that their employees' unions made concessions in negotiations this year more frequently than the jurisdictions did on pay, benefits, staffing and work rules, according to a University of Michigan survey.

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By far, the biggest giveback according to the poll by the U-M's Ford School of Public Policy was on fringe benefits: 69 percent of local leaders report their employees' unions made concessions in this area, while just 5 percent report the jurisdiction made concessions. Another 5 percent say each side made concessions, while 17 percent say neither side made concessions.

Overall outcomes of  negotiations on employee benefits in last 12 months (among those that negotiated on benefits)Due in part to declining local government revenue and pressures to cut costs, many public sector labor unions came to the table ready to make concessions. In addition, new state policies may have driven some of the reductions in employee benefits. Public Act 152 of 2011 limits how much jurisdictions can contribute toward the health care costs of their employees, and the state's new Economic Vitality Incentive Program uses revenue sharing incentives to encourage limits on both health care and retirement benefits.

The poll, part of the Michigan Public Policy Survey series at the Ford School's Center for Local, State, and Urban Policy, reports that:

  • According to local leaders, the overall relationship with their employees' unions is positive: 16 percent say the relationship is excellent, while 50 percent say it is good. By contrast, 29 percent say relations are fair, and just 5 percent say they are poor.
  • Statewide, only 27 percent of local governments have a public sector labor union. Among them, 78 percent negotiated with their unions in the past 12 months.
  • Looking ahead, 60 percent of jurisdictions with unions expect to seek new concessions in negotiations in the coming year.

"The unions came to the bargaining table this year ready to make concessions because they understood that their employers, these local government units, are in fiscal distress," Thomas Ivacko, CLOSEUP program manager, said.

The study, conducted April 9 to June 18, involved surveys sent via hardcopy and the Internet to top elected and appointed officials in all counties, cities, villages and townships in Michigan. A total of 1,329 jurisdictions returned valid surveys, resulting in a 72 percent response rate. The survey had a margin of error of 1.43 percentage points either way.

 

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