Steve's powerpoint for web

Future of Public SectorBargainingFPELRA-Steven RosenthalPresident, The Training Tree, Inc.

Future of Public Sector Bargainingin Florida

Let’s Look at Historical Data and Ask the Right Questions?We must investigate a Possible, Probable or Preferable Future?How did we get where we are in 2011?Why do we seem to be going in a catastrophic direction?What will we need to do to change the course?Are we strong enough to meet the challenge?

Why Did We Have Unions In The First Place?A labor union is a group of workers who have organized in order to pursue common work-related goals, such as better wages and benefits, safer worker conditions, and greater job security. Unions were a reaction to the times and how people were treated. “You get the Union you deserve.”

The Basic Structure of Unions Came From A Guild, Trade and Industrial MentalityCraft Union – workers that have the same skill or work in the same professionIndustrial Union – workers who are employed in the same industry regardless of their specific skill or profession

Why did Local and National Unions Emerge? Local and National Unions were created as a reaction to the times. How were employees being treated?Local Unions provide services to the members:Legal Advice

Collective bargaining Services-Safety and Security

National Unions provide the high profile and national voice for the labor movement.

Lobbies Congress in support of labor legislation

Support efforts to increase union membershipHistorical PerspectiveEmployment at will prevalent prior to 1930sEmployers took advantage of this doctrine to discriminate against workers who attempted to organize or join unionsCourts supported employersThe Depression of the 1930s changed the public’s view of unionsMany key labor laws were enacted during The Depression in support of unions.

Labor Laws in the United StatesNorris-LaGuardia Act (1932)Workers had a legal right to organizeMade it difficult to get injunctions against union activitiesNational Labor Relations ActIllegal for employers to discriminate based on union membershipEstablished the National Labor Relations BoardEstablished voting procedure for workers to certify union as the bargaining agentRequired employers to recognize the union and bargain in good faith

Labor Laws in the United StatesFair Labor Standards ActBanned many types of child laborEstablished the first federal minimum wageEstablished a standard 40 hour work weekRequired that workers receive overtime pay

Labor Laws in the United StatesThe labor laws enacted in the 1930s resulted in a surge in union membership

After WWII, unions began to take advantage of their new-found strength

In the first six months of 1946, almost 3 million workers went on strike

The strikes created serious disruptions and created a fear of big laborWork Stoppages in the United States

Managing Labor UnionsTaft-Hartley Act (1947)Declared unfair labor practices by unions illegalAllowed employers to speak against unions during organizing campaignAllowed members to decertify their unionEstablished provisions for emergency strikes Landrum-Griffin Act (1959)Guaranteed all workers the right to participate in union meetingsEstablished secret ballot election of officersRequired filing of financial statementsProhibited felons from holding union office

Right-to-Work LawsUnion Shop – employers can hire workers who don’t belong to the union but nonunion workers must join the union within a specific amount of time to keep their jobsClosed Shop – workers must belong to the union before the employer can hire them

FDR was Right! In the public sector, said FDR, "the employer is the whole people, who speak by means of laws enacted by their representatives in Congress." Allowing public-employee unions to engage in collective bargaining would mean opening the door to the manipulation of government policy by a privileged private interest. There was a time when even pro-labor Democrats objected to public-sector unionism. "The process of collective bargaining, as usually understood, cannot be transplanted into the public service," President Franklin D. Roosevelt wrote in 1937 to the head of the National Federation of Federal Employees.

The Tide Turns After WWII In the ensuing half-century, the public sector in the United States has grown enormously. The number of government employees at all levels surged from about 8.2 million in 1959 to 22.5 million in 2009. Historically, government work paid less than comparable employment in the private economy, but greater job security and good pensions compensated for the lower wages. No longer: now government workers tend to fare better than private-sector workers across the board—not only in job security and pensions but in wages and other benefits as well.

The Data Shows The Disparity Nationwide, according to BLS data for 2009, state and local government employees were paid an average wage of $26.01 per hour, which was 34 percent higher than the average private-sector wage of $19.39 per hour. Even more lopsided was the public-sector advantage in fringe benefits, such as health and life insurance, paid vacations and sick leave, and—above all—retirement income: state and local governments provided their workers with benefits valued, on average, at $13.65 per hour, a 70 percent premium over the average benefits package in the private sector.

The Disparity WidensIn addition to being more expensive, the benefits that come with government jobs are provided to more employees. Life insurance, for example, was offered to 80 percent of employees working for the government but to just 59 percent of workers in the private sector. Traditional defined-benefit pension plans were available to 84 percent of government workers—but to only 21 percent of private employees.

The Public Sector Abuse Is EverywhereIn July 2009, The Boston Globe interviewed Scott Lang, the mayor of New Bedford, Mass., and a rarity -- especially among Democrats -- in his willingness to call urgently for rolling back public pensions and health benefits.He says current pension and health insurance systems for city employees have to go, period. If not, they will destroy the city and its ability to maintain the services people expect like public safety. . . ."It's absolute insanity. They're unsustainable," he says about pensions. "There isn't the money to pay for an unfunded liability like that. All the revenues will be eaten up by past-due promises."

The Creation of Pension Pathology The excesses in government pensions have drawn mounting scrutiny in recent years. Every day there are a dozen or more fresh links at the invaluable website PensionTsunami.com, which aggregates the latest press coverage of the "multiple pension crises that are about to drown America's taxpayers." Even traditionally liberal, government-friendly publications -- the Boston Globe, the New York Times, the Washington Post -- have devoted considerable attention to the exploding costs of public pension plans and the many techniques state workers can use to "spike" their retirement payout.

It Just Keeps Skyrocketing!Unsustainable PensionsEscalating Health CareLiberal DisabilityAdditional BenefitsVacation, PTO, Sick Leave PayoutsShorter Careers and Double and Triple Dippers

The Fundamental Flaws-No.1First, unlike their counterparts in the private sector, government unions are largely free from market discipline. Unions operating in the private economy know that there are limits to the demands they can make of an employer; private firms have to earn a profit to stay alive, and competition swiftly punishes those that fail to control cost and quality.But public-sector unions face no such constraint. The government agencies they bargain with don't have to make a profit or retain customer loyalty; they can't go out of business or relocate to another state.

The Fundamental Flaws-No.2A second advantage lies in the difference between public- and private-sector strikes. In business, a strike (or the threat of a strike) is an economic weapon that takes a toll on both sides: management suffers the loss of business, and labor must absorb the loss of wages. Government services tend to be legal monopolies, a strike by any public employee inflicts pain on the public at large. The union seeks to pressure management by making conditions so miserable that voters will pressure public officials to end the crisis by acceding to the union's demands.

The Fundamental Flaws-No.3Labor and management frequently both stand to benefit from higher wages and more munificent retirement income. One group will eventually get if the other group is given it.

Limited “real incentive to curtail or end” the benefit.In public-sector collective bargaining, the fox is watching the hen house-In fact the Fox is in charge of the hen house.

The Problem Mounts With Political Lobbying-Just one Union SnapshotSEIU spent $67 million to elect Barack Obama and other Democrats in 2008. In the first nine months following Obama's inauguration, union president Andrew Stern visited the White House 22 times—more than any other visitor. Several top SEIU officials were appointed to posts in the new administration, including Patrick Gaspard, who became the White House political director, and Craig Becker, who was named to the National Labor Relations Board. "SEIU is on the field, it's in the White House, it's in the administration," gloated Stern

The Federal Government is Even More Generous With Your Dollars.The government advantage at the federal level is even more alarming. Total federal civilian compensation in 2008 averaged $119,982—more than twice the $59,908 in wages and benefits earned by the average private-sector employee. Federal employees in 1960 averaged $1.24 for every $1 earned by an American in the private sector. By 1980, that $1.24 had grown to $1.51; in 2000 it was up to $1.66. Now it is $2—and climbing.

The State of the Unions: Achievements, Problems, and ChallengesMost union workers earn 10% - 20% more than nonunion workers.In 2008, 91% of Union workers had health insurance, compared to 58% of nonunion workers.57% of union members had paid personal leave days compared to 38% of nonunion workers.

Unions and Job SecurityGrievance procedures give workers represented by unions more protection against arbitrary dismissal than nonunion workers.Procedures in CBA’s make it harder and longer to try to dismiss a union employee.Over these stressful economic times employees have seen attempts to cut back benefits and have seen reductions in force-Answer-A Union Couldn’t Hurt-look at the statistics.

The Disparity Continues to Widen In 2009, 12.3 percent of the total U.S. work force was unionized, a drop from nearly a third during the mid and late Fifties. Among private-sector employees, only 7.2 percent belonged to a union last year; in the public sector, the figure was 37.4 percent. In absolute numbers, public sector employees have more members than their private sector counterparts - 7.9 million vs. 7.4 million. Indeed, even though the unemployment rate in 2009 rose to around 10 percent, total government employment grew by 16,000 to reach a record-high 22.5 million.

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