01/29/08 UNION CONTRACTS (MOUs) AND THE CITY BUDGET SHORTFALL

The Los Angeles Times and the Daily News have both reported extensively on the City’s alleged structural deficit and budget shortfall. Various elected officials have issued their solutions for their self-created problems. As usual, both the press and the officials place much of the blame and a large amount of the solution on the backs of City employees. The impact of various proposals is different depending on which union contract applies.

RE-OPENERS: EAA’s contracts contain no re-opener clauses tied to City revenue forecasts or any other event. This means that all provisions of the EAA contracts are firm and in place for the entire contract period.

The Coalition of L. A. City Unions (Coalition) contracts contain re-openers tied to City revenue projections. Those re-openers are now being triggered and some City Council-members have indicated that all portions of the contracts are subject to negotiation. The Daily News for January 29, 2008 reported that the Mayor will not say whether he intends to renegotiate the unions’ salary package and quoted Barbara Maynard, the spokeswoman for the Coalition, as stating, “This is a tough budget year. We agreed to work with the City to find ways to save money and do City services more efficiently.” Exactly what concessions are negotiated will become apparent with time.

FURLOUGHS: Mayor Villaraigosa proposed a ‘voluntary furlough’ of up to five days without pay by June 30, 2008 for each City employee. These voluntary furloughs affect City employees only in accordance with each employee’s own situation. However, the Daily News quotes the Mayor as stating that this “program is voluntary now because City leaders have to meet with union leaders”, implying that this will become a point of discussion in the re-opener negotiations for the Coalition. He also stated that “We may have to look at other things as well, such as mandatory furloughs and layoffs”. Furloughs will still remain voluntary for EAA members regardless of any agreement between the City and the Coalition.

EAA members and their negotiating team achieved these fully guaranteed contracts through their hard work and perseverance. As time goes on and the City's budgetary situation worsens, it underlines the great job EAA members and their negotiating committee did when they negotiated the current set of MOU's. One of the important aspects of any MOU is to protect the gains acquired and the EAA MOU's have accomplished this.