AFSCME pay decision reveals high cost of government worker unions

Mailee Smith

Senior Director of Labor Policy and Staff Attorney

Mailee Smith
November 9, 2017

AFSCME pay decision reveals high cost of government worker unions

An Illinois appellate court ruled Nov. 6 the state must pay “step” raises to the approximately 35,000 state workers represented by AFSCME – a cost that burdens already overtaxed Illinoisans.

Illinois state workers represented by the American Federation of State, County and Municipal Employees have been without a contract since the last one expired June 30, 2015. Negotiations for a new contract stalled when AFSCME wouldn’t relent in its demands for $3 billion in additional wages and benefits.

In the meantime, the state has not been paying “step” increases – built-in wage increases negotiated under the last contract that are based on years of service.

But now an Illinois appellate court says the state must pay those extra wages.

AFSCME workers already receive incredible wages and benefits. In fact, Illinois state workers are the highest-paid state workers in the nation when adjusted for cost of living. On average, AFSCME workers receive nearly $110,000 a year in total compensation.

And yet, the union is demanding even more.

AFSCME workers receive multiple pay raises each year

State workers represented by AFSCME don’t just receive a single annual raise. They can actually receive multiple wage increases each year.

In addition to typical annual raises promised under the collective bargaining agreement, state workers can receive semi-automatic in-series promotions to fill vacancies and also receive wage (or “step”) increases upon completion of 12 months of service. State workers can also get longevity pay increases when they have reached the top step and have 10 or more years of creditable service.

The state argued it was not bound to pay the step increases after the expiration of the last collective bargaining agreement. But the 5th District Appellate Court disagreed, and the case has been sent back to the Illinois Labor Relations Board for further proceedings.

AFSCME’s list of demands

Between 2005 and 2014, AFSCME worker salaries grew five times faster than Illinois worker earnings and at twice the rate of inflation.

But AFSCME wants even more.

During the now-stalled negotiations with the state, AFSCME outlined demands that would cost taxpayers $3 billion in additional wages and benefits.

Those demands include:

    • Raises for workers who are already the highest-paid state workers in the nation when adjusted for cost of living

During negotiations, AFSCME demanded payroll increases of up to 29 percent.

AFSCME later claimed it would accept a wage freeze. But that claim is misleading because that freeze would only apply to base wages. The union is still demanding all of the other wage increases promised under the last contract, including step increases. It also continues to demand overtime pay after just 37.5 hours in a workweek.

    • Platinum-level health care at little cost to state workers.

Under the previous contract, state workers receive platinum-level health insurance – a level of coverage not even available to Illinoisans on the state’s insurance exchange, let alone at the rock-bottom prices state employees pay. Taxpayers subsidize a whopping 77 percent of the average AFSCME worker’s health care, which costs taxpayers $14,880 a year per worker.

Instead of continuing to provide platinum-level health insurance at bronze-level prices, the governor is asking AFSCME workers to pay 40 percent of their health care premiums – up from the 23 percent they pay now. This means state taxpayers will continue subsidizing 60 percent of an AFSCME employee’s health care, at $11,600 per worker annually – still a significant amount by any standard.

    • Overtime pay starting at just 37.5 hours.

Currently, many state workers earn overtime after working just 37.5 hours in a workweek. The governor proposed overtime provisions that more closely reflect the private sector, requiring 40-hour workweeks for state workers before overtime kicks in. The difference between a 37.5-hour workweek and a 40-hour workweek would save the state $63 million dollars over the term of the contract. And adjustments to the way in which holiday overtime pay is computed would save the state an additional $48 million.

Missing from this list of demands is consideration for the people who would have to pay for continued AFSCME perks.

Instead, AFSCME believes its demands can be paid for by raising taxes – a slap in the face to taxpayers in a state with the worst income recovery in the Midwest since the Great Recession.

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