After a marathon bargaining session that lasted from Friday morning into early Saturday morning, the school district and MTI, our teachers union, settled on the terms of a two-year collective bargaining agreement for our teachers and four other bargaining units that will take effect on July 1. As is true for most negotiations, the terms of the final agreement varied considerably from the parties’ initial offers (discussed in my previous post). The school board ratified the agreement on Saturday and MTI membership voted to approve the pacts today, Sunday.
Here are some frequently asked questions about the agreement along with my responses.
What is your reaction to the settlement?
I have a sense of satisfaction that we were able to get a deal done that strikes a reasonable balance between, on the one hand, the needs of our school district and our property tax payers and, on the other, the strong interest of our teachers in maintaining the key protections that the collective bargaining agreement affords them.
I certainly do not feel elated that we just did our part in the Governor’s state-wide project to extract about a billion dollars out of the take-home pay of Wisconsin’s teachers over the next two years. More than ever, we are indebted to our teachers for their commitment and dedication during these very dispiriting times.
I think we did what we had to do under the circumstances and arrived at the kind of result that our community wants.
Why the rush?
Any new contract has to be agreed upon and ratified prior to the effective date of the budget repair bill, which will be one day after the publication of the bill. On Friday morning, it appeared possible that publication of the bill could occur as early as that day, which meant any new contract would have to be finalized that day as well.
Later in the day, Secretary of State Doug LaFollette said that he did not intend to publish the bill immediately, and this reduced the time pressure a bit.
However, the dynamic of bargaining is such that once the likely contours of a possible agreement come into view, the parties will often push hard to keep going until an agreement can be reached. That’s what happened here.
How do the economic terms of the settlement compare with the provisions of the recently-enacted legislation?
Overall, the impact on salary levels, retirement contributions, and employee contributions to health insurance is roughly comparable.
Salaries: The agreement imposes a salary freeze for the two-year period but permits advancement across tracks and levels. This means that the salary structure remains the same, but if an employee qualifies for a higher-pay category as a result of an additional year of experience or the attainment of, e.g., a master’s degree, the employee’s salary will increase accordingly.
Under the recent legislation, salaries can increase no more than a percentage equal to the increase in the consumer price index. I don’t know what, if anything, the legislation does to advancement across tracks and levels.
The salary provisions are said to save $1.9 million each of the two years of the contract, compared to the assumptions in the school district’s modeling that have been used to develop our budget projections for the upcoming biennium.
Retirement: Teachers are required to pay 50% of the total annual contribution to their Wisconsin Retirement System (WRS) account. This is the same as the requirement under the new law. It should save the District about $11 million per year.
Health insurance: In year one, the district can require increased contributions toward the cost of health insurance, with projected savings to the District of about $1.7 million. In year two, the school district can cease offering the option of WPS insurance and instead increase the number of HMO offerings. Premium contributions can be 10% of the cost of the policy. The savings attributable to this change could be $5.7 million.
The new state law provisions regarding contributions toward health insurance do not apply to the school district because our health insurance is not offered through the Public Employers Group Health Insurance plan. However, the new state law generally calls for the employer contribution toward the cost of health insurance to be capped at 88% of the cost of the least-cost option.
The terms of our agreement do not vary from this too much, if we assume that the cost of the various HMO options offered in year two will be fairly close. The district’s share of the cost would be 90% of the cost of the policy, rather than the 88% called for in the legislation.
What about the non-economic terms of the agreement?
Among other changes, the district was able to obtain some modifications to the definition of the school day in the new agreement that I am told will increase our flexibility in helpful ways. We were also able to arrive at a reasonable agreement on making up the time lost during the four days our schools were closed as a result of the protests.
Don’t the beneficial components of the new contract vindicate Governor Walker’s insistence on the changes incorporated in the new legislation?
There is no question that the new legislation substantially recalibrates the balance between employers and employees in a way that favors employers. As a result, the school district had considerably more leverage on Friday than in previous bargaining and was able to make use of this leverage to gain concessions regarding, for example, the definition of the work day that the district believes are beneficial.
But there was no need to end collective bargaining and eviscerate public employee unions in order to effect this shift in relative bargaining power. The same goal could have been achieved through changes in the criteria that determine the outcomes of arbitration, for example.
Greatly restricting the collective bargaining process is counterproductive, as this weekend’s bargaining proves.
We are facing very difficult and rapidly-changing circumstances that adversely affect our teachers. As a result of bargaining, leaders for the school district and for the teachers were able to come together, talk through the situation, and work out a deal that adjusted our bargaining agreement to accommodate the new realities.
The process was relatively swift and relatively cordial and led to a reasonable result. Our concerns are lessened that teachers unhappy with the situation will take actions to express their displeasure that would adversely affect teaching and learning. From a management perspective, we have the benefit of being able to say to unhappy teachers that this is a very tough situation but a reasonable deal under the circumstances, as evidenced by the fact that your leadership recommended it and union membership approved it (very reluctantly, as I realize). We are able to diffuse responsibility for the outcome to some extent rather than bear the entire responsibility ourselves. Why in the world would we want to get rid of this process?
You certainly can’t point to this result reached through collective bargaining as vindication for an approach that effectively abolishes collective bargaining. Nevertheless, unless the law changes, Friday’s negotiations marked the last substantial collective bargaining session ever between the school district and MTI.