SEIU, Schwarzenegger agree to labor pact with pension concessions

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Sacramento Bee Oct. 7, 2010

The Schwarzenegger administration and Service Employees International Union Local 1000 have just announced a tentative labor agreement that includes higher employee contributions to their retirement plans and rolls back pension formulas for new hires to pre-1999 levels.

Under terms of the pact, current workers would kick in an additional 3 percent of their pay toward their pensions. Union negotiators also agreed accept one day of unpaid leave per month for a year, which cuts employee pay and hours by roughly 5 percent per month. In exchange, workers covered by the agreement won't be subject to furloughs that lawmakers might impose during that period.

The deal also continuously appropriates payroll funding for the life of the contract, a provision that shields covered workers from their pay being temporarily withheld to the federal minimum allowed during budget delays.

"This was a hard-fought negotiation but we proved that collective bargaining works," said SEIU Local 1000 President Yvonne Walker in an announcement release shortly before midnight. "We reached an agreement that helps the state maintain services, during this unprecedented fiscal crisis, while providing stability for our members."

An administration-release e-mailed at around the same time called the union concessions, "hard-fought pension reforms and other payroll savings that help balance the FY 2010-11 State Budget."

Schwarzenegger, a Republican, has made cuts to state employee pensions a centerpiece of his labor talks with the unions and in budget negotiations with the Democrat-controlled Legislature. Six other state worker unions representing about 37,000 employees have reached labor agreements with the governor in recent months. All accepted various concessions in pay and benefits.

The new SEIU contract, which must be ratified by union members and the Legislature, would run from July 1, 2010, to July 1, 2013. The local has been without a labor deal since June 30, 2008. It represents 95,000 workers, nearly half the government's organized work force.