DC
37 Executive Director Henry Garrido, who seeks a new contract for his
union’s members, attended the mayor’s State of The City speech, Jan. 26,
2023.
Most city employees are now working
under expired labor contracts that lapsed as far back as 2020 —
frustrating rank-and-file union members whose anticipated pay raises are
tied up in an escalating battle over proposed changes to retired
colleagues’ health coverage.
Nearly all of the city’s roughly
300,000 unionized staff are working under expired collective bargaining
agreements. They include members of the city’s largest public sector
unions, District Council 37 (DC37) and the United Federation of Teachers
(UFT). Administrative workers, school crossing guards, teachers, police
detectives, sanitation workers and health technicians are among those
eager to bargain for raises as well as potential new benefits, such as
flexibility to work remotely.
That their adversary, Mayor Eric Adams, is himself a former city worker who emphasized his background on the campaign trail and collected many union endorsements only adds to their frustration, especially for those who helped keep the city going during the worst of COVID.
“I
think that he misrepresented himself to the unions,” said a delegate to
DC37 who declined to give their name as they are not authorized to
speak publicly about the issue. Delegates are elected to represent their
locals at the 300-member Delegates Assembly and are themselves in charge of electing the union’s leadership.
Said
Barbara Randolph, a nurse at Lincoln Hospital in The Bronx: “He won’t
be mayor for too much longer if he won’t back the union.” The New York
State Nurses Association contract with the city’s public
Health+Hospitals system expires March 2.
A roadblock: Retired city workers successfully sued
to derail Adams’ plan to move retiree health care to a cheaper
alternative called Medicare Advantage and charge a monthly fee to those
who wish to retain existing coverage. A City Council bill pushed by
Adams that would allow him to roll out Medicare Advantage, which he says
would save the city $600 million a year, is “dead,” the Daily News reported last week.
That leaves Adams hundreds of millions of dollars short. The planned
Medicare Advantage shift originated in deals struck by former Mayor Bill
de Blasio and the unions to pay for raises by finding health care
savings. As long as that money remains in limbo, new contract
negotiations are going nowhere.
“Our contract is not being
negotiated until this is resolved,” said the District Council 37
delegate. “That’s what we’ve all been told.” Some public sector union
leaders have also said that the health care talks have stood in the way of bargaining a new contract for their members.
Medicare Mess
The
executive director of DC 37, Henry Garrido, also co-chairs the
Municipal Labor Committee, the consortium of public employee unions that
agreed to the health savings deals. He declined to speak about the
standoff or his members’ frustrations.
“We don’t bargain in the press,” said Garrido, who declined to comment further.
Garrido
and other union leaders are getting vocal pushback from their ranks
— and not just from retirees who would be immediately affected by health
coverage changes.
Five chapters of DC37 Local 375 — which
represents city planners, engineers and architects — wrote in a Jan. 9
letter to City Council labor committee chair Carmen de la Rosa that they
did not support the Medicare Advantage switch and urged her to kill the
proposal. DC37 Local 768, which represents therapists, exterminators,
and other health technicians, also urged its membership to pressure their City Council members to strike down the bill.
A City Hall spokesperson said the Adams administration is “committed to offering quality and sustainable care for our retirees.
“The
city and the Municipal Labor Committee worked together to take
advantage of the federal funding for Medicare Advantage plans that would
permit us to continue providing high-quality, premium free coverage for
retirees while saving approximately $600 million a year — savings that
are especially critical as we continue to face a skyrocketing health
care crisis and other fiscal challenges,” mayoral spokesperson Jonah
Allon said in a statement.
Pointing to a recent Council hearing
on the bill that would break the Medicare Advantage logjam, Allon added:
“We presented a clear case that the city’s Medicare Advantage plan
would offer myriad improvements over the current SeniorCare plan, while
still encouraging the Council to preserve retiree choice by amending the
administrative code.”
Health Care Costs
Marianne
Pizzitola, an FDNY retiree and president of the NYC Organization of
Public Service retirees, the nonprofit behind the lawsuit, urged the
mayor and the Municipal Labor Committee to find another way to reach
health care savings.
“This is not being supported by the City
Council, it’s not appreciated by our seniors. Let’s do something else.
Let’s go back to the bargaining table and figure something out,” she
told THE CITY.
The last mayor to let contracts lapse was Michael
Bloomberg, who refused to settle with any of the city’s 152 labor
unions, effectively leaving those negotiations to his successor.
That was Bill de Blasio, who worked quickly to settle expired contracts upon taking office in 2014, reaching a deal with the UFT that May and DC37
soon after. (Just one union remains at sea: the Marine Engineers
Beneficial Association, which represents Staten Island Ferry captains
and mates, has not had a contract for more than a decade.) The health savings pact, and that $600 million in savings, was a critical piece of the puzzle — one Adams is now trying to solve.
Mayors
traditionally settle labor agreements first with the largest unions,
UFT and DC37, which represent about 60% of city employees, setting a
pattern that smaller unions then follow in their own negotiations.
The Adams administration recently began preliminary talks with DC37, whose contract covering 100,000 workers expired in 2021. The loss of expected health savings means money is not flowing into a special health insurance fund that the city and unions jointly administer to help pay for member benefits.
“The
unsettled nature of the Medicare Advantage program as well as the
overall fiscal health of the Health Insurance Stabilization Fund is an
impediment to moving forward with regular labor negotiations,” said Ana
Champeny, the vice president for research at the nonprofit Citizens
Budget Commission.
She added that rising health care costs need to be dealt with, somehow.
“The
entirety of how the city finances, pays for and provides health
insurance benefits and welfare fund benefits to the public sector — both
current employees and retirees — needs a close reevaluation,” she said.
Collective bargaining, she added, is where these issues will play out.
Reserves and Rainy Days
Experts at the Independent Budget Office, an official fiscal watchdog, say that the steep costs associated with past commitments
to help unions pay for GHI Emblem Health, the plan most city workers
have enrolled in since the 1940s, are bound to continue piling up. Since
the 1980s, city union contracts have only guaranteed funding for an
insurance plan that is typically cheaper, called HIP — and making up the
difference has become a ongoing scramble.
“There are always
trade-offs in any particular budgetary decision,” said IBO assistant
director for budget review Logan Clark. “As long as GHI remains more
expensive than HIP/HMO, then we’re going to be dealing with this problem
sort of in perpetuity.” He called the gap between HIP and GHI premiums
“a continuing hole that we will always have to be filling in.”
But
there are options to fill the budget gap, at least for the short term,
he said. The city could tap into its general reserves, funds set aside
every fiscal year, or the Temporary Benefits Trust, a $3.4 billion
reserve.
“That’s something that they could be tapped into as part
of the reserves, either by paying down or essentially making smaller
payments into next year’s payments for retiree health benefits,” said
Clark.
Another option would be dipping into the city’s rainy-day funds
– in what would be an unprecedented move because “the promulgation of
standards of what constitutes an emergency to tap into the rainy day
funds haven’t really been promulgated yet, so that’s something that is
certainly up for question,” Clark said.
So far, Adams budgeted enough in his preliminary budget to cover 1.25% annual raises — far below the current 6.3% inflation rate in the New York area.
Adams
has used his rank-and-file bona fides to set himself apart from his
predecessors, to the annoyance of retirees who sued his administration
over the healthcare plan.
Previous mayors, he told an audience of
labor leaders at the SOMOS convention in Puerto Rico last November,
“never knew what it was like to hold their stomachs when it was time for
union contract negotiations. Didn’t know what it was like to fight for
their healthcare, to protect their pensions, to be on the union lines to
really fight to get the raises you deserve.”
“Like the retirees,” Pizzitola, the president of the NYC Organization of Public Service Retirees, shot back in a moment captured on video.
Arthur Goldstein, a high school ESL teacher who has documented the health care plan saga on his blog, said that he is preparing for a long battle ahead.
“I think we could be without a contract for a very long time.”