Editorials published by the Goffstown Residents
Association are written by various members and
contributing non-members of the GRA.

November 20, 2009
Goffstown workers: Raises for no reason
Will unions play ball with Selectmen?

The Goffstown Board of Selectmen (BOS) recently proposed that our non-union salaried employees get a 2% Cost of Living Adjustment (COLA) increase instead of what our union workers are contractually entitled to: a 4% increase.  This 4% increase for our union workers is mandated by their labor contract with Goffstown, even though there has been no increase in the cost of living this year.

What this means is that this year, Goffstown's unionized workers are contractually receiving raises for no reason.  Those unions should go along with the proposal by the BOS, and if they don't, the Budget Committee could - and should - reduce these additional COLA costs by making cuts to the regular salary lines by an equivalent amount.  In other words, if we can't reduce the cost of COLA payments to the workforce, then we must reduce the size of the workforce.

Remember:  Although Goffstown is contractually obliged to provide these COLA raises to unionized town and school employees, it is NOT obliged to keep these workers employed.  That means if the unions continue to strangle Goffstown taxpayers with contractual COLA increases, the town and school can simply lay off the required number of workers to reduce the overall cost to taxpayers. 

This situation demonstrates one of the many problems caused when including COLAs in collective bargaining agreements:

  • The Police Collective Bargaining Unit (CBU) received a 3% pay increase on July 1, and will receive another 4% on July 1, 2010 - but the cost of living has not gone up.
  • Teamsters CBU will get the same percentage.  In addition, anyone eligible for a step increase will be raised one step as well  - but the cost of living has not gone up.
  • It's the same for the Fire CBU - but the cost of living has not gone up.

Further, these are not just raises to the workers' current pay.  They also increase the step increases by the COLA as well, so a worker who gets a raise in July and then gets a step increase is actually getting a double bump

A better system for Goffstown is a "pay-band" system, commonly used in the private sector.

Unlike the current COLA system, which only serves to cause salaries to rise without requiring any improvement in employee performance, a pay-band system provide a spectrum of minimum - and maximum - pay for each job or job category.  Under this system, if a worker's pay tops out in a particular band, then that's it - until or unless the band is adjusted, or the employee gets a promotion to another, higher-paying job category.  

Under this system, the pay-bands are surveyed periodically against the market - say every 5 years - and appropriate adjustments are then made.  Setting pay-bands is very easy to establish (not to negotiate !!) since the Local Government Center (LGC) publishes books on salaries.  Performance would then be rewarded by merit increases to salaries instead of automatic cost of living adjustments such as those we currently have that come regardless of performance and regardless of whether or not there has been an actual increase in the cost of living!  

Goffstown's operating budgets already have budget lines for merit increases.  The Town could simply add more money to those lines to provide for a pay-band system and merit increases.  Salary adjustments could work this way: above average performance might get a increase greater than the declared increase in the cost of living, average performance could get a small increase (maybe just below the declared increase) and below average performance would receive nothing - except perhaps a written warning or a pink slip.

Of course, workers are not going to like pay-bands, especially because they involve maximums.  One compromise around the possibility that an employee tops out in a particular pay-band but cannot move to another is to not have band maximums.  Salary increases would still be held in check based upon the exempt employee performance and how much merit was awarded

Finally, people (such as yourselves) who are concerned where this salary thing is going had better pay close attention when the time comes to negotiate new contracts.  Thanks to a state legislature controlled by democrats, the Evergreen Clause* will require that the last COLA in the retiring Collective Bargaining Agreement be continued until a new contract is in place.  

That means if the CBU is satisfied with its last COLA, it has less incentive to negotiate.  

It's time for our unions to come back to the table and renegotiate not only these COLA increases, but their entire contracts overall.  If they don't, the Budget Committee may have no choice but to step in and secure the needed financial reductions themselves by reducing the number of workers who are receiving these COLA increases.

And if that happens, nobody wins.

* Note: Evergreen applies only to new Collective Bargaining Agreements negotiated after the law was passed, so it is not applicable to our current three CBUs.



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