Wednesday, January 13, 2016

Labor and Employment Recommendations in Governor’s Task Force Report

On January 4, 2016, the Task Force on Local Government Consolidation and Unfunded Mandates released its Final Report on “Delivering Efficient, Effective, and Streamlined Government to Illinois Taxpayers”.  The Task Force was established by Governor Rauner by means of Executive Order 15-15 in February of 2015.  It states, among other things, that “the State of Illinois has 6,963 units of local government…, the highest number in the United States by more than 1,800 units”.  It also states that “unfunded mandates create burdens upon local governments and school districts, reducing efficiency”.  One of those unfunded mandates is the obligation of units of local government in Illinois to engage in collective bargaining with unions representing various classifications of public employees.

While the Report contains a number of recommendations to increase the efficiency of local government and reduce the burden on Illinois taxpayers by means of consolidation and intergovernmental cooperation, it also makes several recommendations affecting collective bargaining, employee benefits, and labor relations.

The following proposals were submitted to the Task Force on November 19, 2015, and were approved by the Task Force:

Proposal No. 7, approved by a 15-1 vote, is to make collective bargaining permissive, instead of mandatory.  The proposal, if it were to become law, would allow the boards and councils of municipalities, counties, and school districts to determine whether particular issues relating to collective bargaining issues would be mandatory or permissive.  Currently, most subjects of bargaining between local governments and unions representing government employees are mandatory subjects, meaning that the employer cannot refuse to bargain over them and cannot implement changes in wages, hours and working conditions without union agreement or the exhaustion of legally required impasse procedures.  Employers and unions are not required to bargain over permissive subjects, however.  Thus, under Proposal No. 7, a village board could determine, for example, that wages paid to unionized workers is a permissive subject of bargaining, thus allowing the village to refuse to bargain over wages or, if it did bargain over wages, to reserve the right to implement its wage offer unilaterally.      

Proposal No. 8, approved by a 14-1-1 vote, would effectively repeal PA-98-1151 (December, 2014), which made “minimum manning” (i.e., contractual specification of the minimum number of firefighters and/or firefighter/paramedics required per shift or per piece of firefighting or rescue apparatus) a mandatory subject of bargaining in firefighter units and allows interest arbitrators to adopt and award union proposals establishing minimum manning requirements in municipal fire departments and fire protection districts. 

Proposal No. 9, approved by a 13-0-2 vote, would change the judicially-determined definition of “catastrophic injury” under the Illinois Public Safety Employee Benefit Act (“PSEBA”) to conform to the federal definition found in the federal Public Safety Officers’ Death Benefits Act of 1976, 42 U.S.C. §3796b(1), which defines “catastrophic injury” as “an injury, the direct and proximate consequences of which permanently prevent an individual from performing any gainful work”.  Under PSEBA as it currently stands, a firefighter or police officer may be eligible for lifetime health insurance benefits for himself and his dependents even though he remains physically able to perform other work.  PSEBA benefits are extremely costly for municipalities, often amounting to $1,000,000 or more in health insurance premium costs over the lifetime of a police officer or firefighter who has been injured on the job sufficiently to warrant a duty disability pension.  

Proposal No. 10, approved by a 13-0-2 vote, would require that an arbitrator in a public safety (police or firefighter) interest arbitration case use the existing fiscal parameters of a local government agency as the primary consideration when making wage and benefit determinations.  This directive currently applies only to arbitration cases involving the Chicago Public Schools.   

The following proposal was among those submitted to the Task Force on December 8, 2015:

Proposal No. 2, approved by a 13-1-1 vote, would return control of employee benefit packages for new employees to local governments.  Reduction of pension benefits of current employees is prohibited by the Illinois Constitution.  For new employees, however, the proposal would enable local governments to:  opt out of existing pension plans; create a blend of Social Security and 401(k) plans for non-public safety employees; create blended defined contribution/defined benefit pension plans for public safety employees; and give investment control of 401(k)-type contributions to employees.  These retirement options would not be mandatory subjects of bargaining.

Having issued its report, the Task Force is dissolved.  The question now is whether the Task Force’s recommendations, or any of them, will result in legislation.