May 06, 2009
Choosing layoffs over benefit cuts
Thirty-four teachers in Gloversville will lose their jobs, because their union would rather keep a "Rolls Royce" health insurance plan that costs nearly $26,000 for a family policy.
As columnist Carl Stock writes in the Schenectady Daily Gazette, the teacher union contract says the district can alter the health insurance plan "only if the new insurance 'provides benefits equal to or better than those provided under the plan in effect on June 30, 1989,' and there you have it. Locked in."
Since 1989, Gloversville has offered teachers and other employees a Blue Cross Blue Shield indemnity plan that now costs $25,788 a year for a family policy, which is about twice the national average. Employees must pay 20 percent of costs. The district also offers other plans. The district asked the teachers' union and the other smaller unions of school employees to consider surrendering their $25,000 health insurance policies in exchange for more normal policies, for a projected savings of some $1 million, and the answer was no cigar.
So in the new budget, the jobs of 34 of the district's 286 teachers are eliminated, and so are 16 non-teaching jobs. After the school board adopted a $51 million budget with 50 layoffs, Gloversville Teachers Association President Pat Donovan sounded defensive as she told reporters: "We're not the bad guys. We pay those school taxes."
She said switching the health insurance plan would be a hardship to older teachers. Another news story offers a reason why. It quotes Ralph Acquaro of the Johnstown school district, which is strapped with a similar Blue Cross Blue Shield indemnity plan. Acquaro said the plans are so expensive because they include terms such as lifetime maximum deductibles as low as $2,000, after which plan members have no further co-pays. "When that was first put into place in 1980-something, it took a few years to get to $2,000. It doesn't take very long now, and then you've satisfied your lifetime obligation for deductibles," Acquaro said. No wonder the older teachers might be reluctant to switch to a less expensive plan--even if it means 34 of their colleagues will lose their jobs. When Carl Strock asked Donovan whether that was a good deal for her members, she said health insurance was still on the table in contract negotiations. I couldn't get her to say whether sacrificing the jobs of 34 people in order to preserve a Rolls-Royce health plan for the remaining members was a good deal. She would just say it's still under discussion. (snip) ...you see the kind of situation that school districts and local governments get themselves into. Anything they grant in a moment of weakness or irresponsibility can never be taken back, thanks to a state law known as the Triborough Amendment, which keeps public-employee contracts in effect in perpetuam.
You can never say, well, times have changed, and now we have to do things differently.
No. Once it's done, it's done forever, unless the employees' union agrees to a change, and as a general thing a union agrees to a change only if it gets something of equal value.
"If you want it back, you have to pay for it," is their position, which is one reason why public-employee salaries keep going up and up. Local governments are forever buying back, in the currency of salary, some reckless gift from years past.
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