Why the city and Fire Department cannot agree
There is a storm brewing in Sterling Heights, and unless the Fire Department and City Administration come to terms, the citizens will be the losers.
Since 2010, the administration has relied on voluntary labor contract concessions to not go too deeply into the red. The city spends more than it takes in via taxes and revenue sharing with the state, and labor is the single biggest cost. So in 2010, it convinced all of the bargaining units to accept a 10% reduction in wages and benefits for the 2010/2011 calendar year.
The agreements only lasted one year. Unfortunately, 2011/12 will be another tough year on the city’s budget. Tax revenues continue to decline, and Governor Snyder’s budget reduces revenue sharing even further. So once again, the city needs labor to agree to reduce benefits and freeze wage increases.
Unfortunately, things have not gone so smoothly this time.
The Fire Department’s bargaining unit came up with a counter-proposal. According to The Sterling Heights Sentry, Firefighters Local 1557 offered the following: instead of reducing our wages, we can assume all of the transportation responsibilities for emergency medical patients. By canceling the contract with the city’s current ambulance service provider, the city would realize a savings equal to or in excess of the 10% requested.
It is easy to understand the Fire Department’s perspective. Since they already go to every medical emergency and accompany the patient to the hospital, why not have them drive the ambulance too? Why wouldn’t the city agree to this instead of cutting the pay of the fire fighters?
The City Administration rejected the proposal saying it wasn’t the direction they wanted to go in, and now has given the notice that lay-offs are forthcoming.
Why it didn’t work
Perhaps the reason why the city rejected this proposal isn’t obvious.
When you are forced, as the city administration is, to deal with collective bargaining units, you are consequently forced to deal with something called “pattern bargaining.” If the fire fighters get to keep their wages, a precedent will be set, and the other labor unions will want to keep theirs too. In other words, all of the bargaining units have to get essentially the same deal, or else one or more of them will feel cheated. It’s just human nature.
The other bargaining units can’t come up with several million dollars worth of savings like the Fire Department can, so they can’t exchange anything to keep their wages and benefits for 2011/12, unless they voluntarily reduce head count. Which, of course, would be anathema to being in a labor union in the first place.
So we have an impasse. The Fire Department, feeling they have attempted to deal in good faith, are upset their idea has been rejected. And the city, having no other choice, has to reduce head count to achieve the needed savings. This will not bode well for this year’s contract re-negotiations.
How we all lose
In the middle, of course, are the residents. We either have a Fire Department with diminished numbers, or a bargaining agreement that isn’t perceived as fair to the other bargaining units. With contract negotiations taking place this year, the perceived unfairness would drive up the cost of labor from the other units. Either way, we lose.
So the residents lose, the city administration loses, and the Fire Department loses. It’s a recipe for disaster.
There have been a lot of labor voices shouting in the national news over the past several weeks about the labor situation in Wisconsin, with the governor of that state trying to take collective bargaining rights away from government employees. Labor decries this as unfair, and the media only portrays their side of the story. Situations like this, however, are proof that there are two sides to the story, and the workers are negatively impacted by collective bargaining just like everyone else is.
The Firefighters Local 1557 cannot win because it is not negotiating in a vacuum. The city cannot win because it is negotiating collectively. The residents cannot win because it’s going to cost them more no matter how it goes.
How to solve the problem
The answer in the case of Sterling Heights is simple. As you might expect it should be a compromise. What needs to happen is the Fire Department needs to follow the pattern for 2011/12 and accept another year’s worth of lower wages and benefits, in exchange for an agreement that the ambulance transportation idea will be back on the table as the contract gets re-negotiated later this year. The city will get its cost reduction, the residents will get their fire service, and the fire fighters can look forward to better days in the future, as long as negotiations are reasonable and prudent, and everyone strives for a fair outcome.
That would get us past the current impasse, but the Fire Department needs to understand something: the financial pinch the city is in is not short-term. There has been permanent damage done to the city’s ability to collect operating revenue, and every nickle and dime needs to be spent carefully. For the foreseeable future the city needs to go on an austerity program in order to make the revenue model sustainable. And that demands a significant savings in the next contract over the current one, possibly beyond what the temporary concessions achieve.
Unfortunately, the city’s financial troubles cannot be avoided any longer. Our ability to pay our workers has been substantially reduced, and as a result there have to be some painful measures taken to fix the problem. At the end of the day, it isn’t about worker rights, labor laws, or us versus them. It’s about how do we work together in order to survive. We have to adopt a new mentality on Utica Road, otherwise our prospects are poor.