Projo Biz Blog

In some cities and towns, such as East Providence, the spirit has been more confrontational than concessional.

Unable to get the savings it wanted from the teachers union, the school committee there unilaterally imposed a wage cut of nearly 5 percent and started deducting enough to cover 20 percent of their health-insurance premiums. Until then, they had paid nothing toward their health benefits. That committee's action is now being challenged by the union both in state Superior Court and at the State Labor Relations Board.

Yet confrontation seems to be the exception these days.

"We are in a period of concession bargaining, there's no doubt about it," said Robert A. Walsh Jr., executive director of the National Education Association of Rhode Island, which represents teachers in 28 districts in the state.

"We're seeing contracts not settled or settled with concessions. Often it will be a year without any raise whatsoever, except for the step increase for teachers on the lower scale," he said.

Tim Duffy, executive director of the Rhode Island Association of School Committees, agrees. "In West Warwick and North Providence, where they've had an acute fiscal crisis on the municipal side, unions have come back to the table to make concessions," he said.

West Warwick offers one of the most dramatic examples.

Teachers agreed to have their salaries rolled back to what they were being paid in 2007 and a freeze in pay lasting at least through June of 2011. They also agreed to increase their co-share for health insurance to 15 percent. It had been 5 percent.

Providence teachers signed a new contract with no salary raise for this school year and they agreed to pay 15 percent of their health-insurance premiums (as newer teachers are already doing), along with higher co-pays for doctor visits.

"The concession bargaining was unprecedented in that most, if not all, took place as a direct result of state aid cuts in fiscal '09 and the next year," according to Daniel L. Beardsley Jr., executive director of the Rhode Island League of Cities and Towns.

"Many public employee unions, to their credit, stepped up to the plate," he said. "But they realized that their contracts were about to expire, or they realized it was better to step up to the plate and begin the process [before budget season ended]. Some were reluctantly dragged to the table. And some refused to go to the table."

In contrast to the brouhaha between its teachers and School Committee, East Providence's police and municipal unions agreed to a pay freeze through the city's fiscal year which ends October 31. (Current employees are also paying more for health insurance, but it will still be a bargain -- costing no more than $20 per week.)

But the peace may not last much longer. On Aug. 11, the city manager announced that continuing budget problems are forcing the city to lay off 13 police officers immediately.

The union has promised a challenge.

Beardsley said police and fire unions have been least likely to make concessions because they know any unilateral cuts will go directly to arbitration, a process that protects the unions.

That's what the Providence firefighters did when Mayor David Cicilline imposed a switch from Blue Cross & Blue Shield of Rhode Island to UnitedHealthcare of New England and CVS/Caremark. An arbitrator blocked the change because language in the contract designated Blue Cross as the administrator of benefits for the union.

But there have been plenty of instances where the police and firefighters have agreed to givebacks.

West Warwick police agreed to an 18-month pay freeze that will extend through 2010.

Police in Lincoln agreed to forgo a 3-percent pay raise.

And in Warwick, the police, fire and municipal unions all made various accommodations with little turmoil. Police, for example, took a pay cut of 3.5 percent and doubled their share of health-insurance payments, to 10 percent.

East Greenwich's police department, town and school employees are paying higher deductibles when they seek treatment.

It took only about two meetings with each union to cut the deals, said Town Manager William Sequino Jr. "They all understand the economy and what it meant to the town. It meant we also didn't get involved in any layoffs."

"Even affluent communities are at the table taking a look at some of these issues," said Duffy.

Barrington is one town where workers have gotten off relatively easily. The teachers will be paying more for their health care, but pay in the town will not be frozen.

The town's secret? "We receive little in state aid so they could take little, and we've learned to be less dependent on it," said Town Manager Peter A. DeAngelis.

But if the economy continues to go south, he said, the unions will be asked to feel some pain.

On the opposite end of the spectrum, there's the case of Cranston and its police union, where Republican Mayor Allan W. Fung cut deal for savings with the union, yet the all-Democratic City Council rejected it.

The council accused Fung of giving up management rights and obtaining most of the savings through vacant positions.

Fung argued unsuccessfully that not filling vacant jobs was the biggest contributor to savings in a council-approved deal with the firefighters, and that the council had earlier OK'd a laborers contract that had no concessions at all.

In some municipalities, the deals are going to save money over the short term but be costly over the long haul because unions that lost something this year or last year are scheduled to get extra in the future.

Cranston's firefighters, due to receive a 2-percent raise last month, took 1 percent instead, in return for 3 percent in July 2010, when they were scheduled to receive 2 percent.

Delayed gratification was also the theme in the deal Warwick cut with its teachers last year.

Although the union shaved 1.5 percent off the 3.5 percent pay increase teachers were to have received, workers will get the money they "lost" when they retire or resign. In addition, the teachers got to keep their health coverage at the bargain-basement price of $11 per week, and they were promised pay raises of 2.25 percent this year and 2.75 percent next year in a two-year contract extension.

Yet some of the savings will persist.

The unions whose members agreed to pay a higher share of their medical insurance will probably be living with that for some time, in part because of the growing realization that health care costs are spiraling out of control for everybody.

Cranston firefighters agreed to more than double their share of their health-insurance premiums, from 6.7 percent to 16 percent for an individual plan.

Cranston's teachers, who get a 1 percent increase this year, will be paying 15 percent of their health insurance premiums, up from 5 percent.

"I think the co-shares will last," said Duffy. "You may see, in the next round of negotiations, 15 percent go to 20 percent. In Cranston it's 15 percent and it escalates to 17, which is what state employees in the upper echelons are paying in their health care."

Duffy warned that even tougher times may be ahead.

The negotiating strategy of the unions may be to make concessions now and lock in a contract for the next few years in the hope that the economy will have improved by the time the contract expires, he said, adding that "in next year's contracts, [municipalities] may be asking for much more in the way of concessions because the economy for the state doesn't look good for the next three or four years."

(With reports from Randal Edgar, Barbara Polichetti, Alisha Pina, Lisa Vernon-Sparks, Philip Marcelo, Talia Buford and Mark Reynolds. )

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