Why the “Yes” Recommendation on Union Contracts?

February 28, 2014
 
by Lynne Ober

Since the Hudson Town deliberative session, there have been numerous questions about why both the budget committee and selectmen recommended the passage of all the union contracts.  The short answer is each contract finally provides relief from a very expensive benefit package that will save taxpayers money in the first and following years.  Town Administrator Steve Malizia said, “The most important improvements in the contracts from the town’s perspective are the changes that have been to the health insurance language specifically dropping the most expensive plan, Blue Cross Blue Shield JY in favor of the Blue Cross Blue Shield Comp 100 plan and setting a fixed rate for the insurance opt-out payment (commonly referred to as “flex”).  These changes should help the town control costs and save money on our insurance in future years.”

Additionally, across the board, no retroactive raises are included in any of the contracts.

Many of the questions have surrounded the “need” or “appropriateness” of providing raises for town employees when the state is still in a recession.  However, proposed contracts have been negotiated to provide a trade-off between very expensive benefit plans and a small salary increase.  Let’s look at each contract.

Warrant Article 2 proposes the equivalent of a seven year contract for the members of the Hudson Police Employees Association, which covers 51 employees, including: patrol officers, master patrol officers, detectives, sergeants, dispatchers and record clerks.

Because the group of employees has not had any raises in the previous four years, selectmen explained the contract as providing for a zero percent cost of living adjustment in years one, two, three and four and a 2.75 percent cost of living adjustment in each of the fifth, sixth and seventh years.

As with the other contracts, the cost savings come from the agreement allowing the town to change the base insurance plan from the Blue Cross Blue Shield JY plan to the Blue Cross Blue Shield Comp 100 plan, which will provide cost savings into the future.  Additionally, employees will now pay 20 percent of the costs and the town will pay 80 percent.  The contract also sets a fixed amount for the insurance opt out payment, also known as flex payments, for current employees and reduces the amount for future employees.

“This agreement will yield savings in future years’ budgets,” noted Malizia, “and will provide contract stability until June 30, 2017.”

One key element of this contract, as well as the other contracts, is that it provides salary stability and places Hudson employees in the middle range of the salary level when one looks at surrounding towns.  Right now, Hudson is at the very bottom of the salary level; one negative aspect has been when employees come to Hudson for training and then quickly apply at a nearby town and get a large salary increase.  Eligible employees would also receive the appropriate step increases during the life of the contract on their anniversary date.

This warrant article would add $0.00 to the tax rate in years 2011, 2012, 2013, 2014 and $0.06 to the tax rate in 2015, $0.05 to the tax rate in 2016, $0.05 to the tax rate in 2017.

Because of the increased savings in benefit costs, a growing portion of any budget, budget committee member John Drabinowicz quipped at the deliberative session that people might wonder who was wearing his suit when he spoke in favor of the contracts.  “The benefit savings are significant for the coming year and future years,” he said as he urged people to vote yes on the contracts.

Warrant Article 3 proposes a four year contract for the members of the Hudson Highway Union, which covers 24 employees, including: truck drivers/laborers, equipment operators, traffic technician, operations assistant, mechanic, and foremen.

Again this contract, which runs until June 30, 2017, provides for the same benefit savings and the same plan change.  “This agreement will also yield savings in future years’ budgets,” said Malizia.

This warrant article would add $0.00 to the tax rate in 2014; $0.02 to the tax rate in 2015; $0.00 to the tax rate in 2016 and $0.00 to the tax rate in 2017.

Warrant Article 4 proposes a four year contract for the 27 members of the Hudson Police, Fire and Town Supervisors Association, which includes police captains and lieutenants, deputy fire chiefs and fire captains, the town engineer, town planner, assistant assessor, highway supervisor, IT specialists and town accountant.

This contract provides for a zero percent cost of living adjustment in years one, two, and three and a 1.5 percent cost of living adjustment in year four.  An additional step has been added to the step schedule (step seven).  Eligible employees would receive a step on their anniversary date.

Once again, this agreement changes the base insurance plan from the Blue Cross Blue Shield JY plan to the Blue Cross Blue Shield Comp 100 plan, sets the town/employee cost share at 80/20 and sets a fixed amount for the insurance opt out payment, also known as flex payment, for current employees and reduces the amount for future employees.  These benefit changes will yield savings in future years’ budgets.

This warrant article would add $0.00 to the tax rate in 2012; $0.00 to the tax rate in 2013; $0.00 to the tax rate in 2014 and $0.03 to the tax rate in 2015.

Warrant Article 5 proposes a six year contract for the 20 members of the Hudson Support Staff Union, including Deputy Town Clerk/Tax Collectors, Senior Accounting Clerk, Administrative Aides, Custodians, Human Services Specialist, Permit Technician, Appraisal Technician, Building Inspector and Utility Clerks.

Although this contract provides for a 0.0 percent cost of living adjustment in Years 1, 2, 3, 4, 5 and 6, it does add an additional step for each grade in year 5 and again in year 6.

As with the other contracts the base insurance plan may be changed from the more expensive Blue Cross/Blue Shield JY plan to the Blue Cross/Blue Shield Comp 100 plan, sets the Town/employee cost share at 80/20 and sets a fixed amount for the insurance opt out payment (also known as flex payments) for current employees and reduces the amount for future employees.

This warrant article would add $0.00 to the tax rate in 2011, 2012, 2013, 2014 and $0.01 to the tax rate in 2015 and 2016 (each).

Warrant Article 6 proposes a seven-year contract for the 35 members of the Hudson Fire Fighters Union, including firefighter/EMTs, firefighter/paramedics, fire lieutenants, dispatchers and the fire inspector.

As with the other contracts, there are no retroactive raises and no cost of living adjustments in any of the years of the contract.  What the contract does provide is an adjustment to the wage scale in order to bring the wage scale into parity with similar communities in our area.  A majority of union members will receive one step on the last day of year seven (Fiscal Year 2016) of the contract.

There are also the familiar benefit changes to the base insurance plan from the Blue Cross Blue Shield JY plan to the Blue Cross Blue Shield Comp 100 plan, sets the town/employee cost share at 80/20 and sets a fixed amount for the insurance opt out payment for current employees and reduces the amount for future employees.  This agreement will yield savings in future years’ budgets.  This contract would run from July 1, 2009 to June 30, 2016.

This warrant article would add $0.00 to the tax rate in 2010, 2011, 2012, 2013, 2014 and $0.04 to the tax rate in both 2015 and 2016.

As a result of the low tax impact to taxpayers in any year of the contracts and the significant changes that will be allowed to the benefit plans, there is unanimity between selectmen and the budget committee on these contracts with both supporting the passage of the contracts.