Concessions Deal Update

August 30, 2011

On Thursday, August 18th, members of the state employee unions once again cast their votes on Governor Malloy’s concession deal. This time however, the unions voted to ratify the package.

During the legislature’s June 30th special session, both the Senate and House of Representatives passed a bill (House Bill 6701) that extended a possible union ratification until the end of August. Union leaders then used this August extension to re-work the ratification rules. Under previous rules, in order for the concession package to pass, ratification required the support of 14 of 15 unions representing 80 percent of members. With the rules change, only eight of the 15 unions must vote in favor, and membership must represent a majority of the unionized workforce.

The second vote on the concession package passed with 14 out of the 15 union coalition voting yes and with a majority (25,713 to 9,791) of members supporting it.

With this package, the Malloy administration hopes to achieve a $700 million saving in the current fiscal year, and then a $900 million savings in fiscal year 2013 – $1.6 billion in total. Many, including the non-partisan Office of Fiscal Analysis, doubt that this projected savings can be achieved.

In order to obtain the $1.6 billion two-year savings, state employees will see a number of changes to their health care and retirement benefits, as well as new programs to garner savings. These new changes and programs include:
An employee suggestion box to achieve $180 million in savings;
A two-year wage freeze;
A doubled penalty (increasing from three to six percent) for early retirement;
The elimination of the October 2011 longevity payment;
Effective 2022, an increase in the retirement age (retirement at age 63 with 25 years of service, and retirement at age 65 with ten years of service); and
A new preventative care wellness program.

In exchange for these concessions, state unionized employees are guaranteed no layoffs for four years. And when the agreement becomes effective on September 1st, the nearly 200 who have lost their jobs will go back to work, and the nearly 3,000 layoff notices that have been sent out will be formally rescinded.

Although most state employees have job security – for the next four years – under the concession deal, those unionized members who most recently voted against the package do not. The Governor has announced that 23 corrections supervisors and 56 state troopers will be laid off because their respective unions rejected the deal or portions of it.

The ratification of the concession package will however prevent a number of closures and reductions to state services. The two seasonal Connecticut River ferries will be preserved, commuter rail service on the Shoreline East rail line (New York through New Haven) will remain open, and no branches of the Department of Motor Vehicles (DMV) will be closed.

Going forward, it is unlikely that the legislature will go back into session to debate or take further action on the ratified concession agreement. The legislature does have until August 31st to convene in order to accept or reject the deal, but failure to act (or go into session) is also considered approval.