June 30, 2004

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Palo Alto Online

Strike likely averted

by Bill D'Agostino

After a roller coaster final week of negotiations, the City of Palo Alto appears to have an agreement with its largest union.

The 600 workers with the Service Employees International Union, Local 715, are scheduled to cast their ballots on an agreement later this week, probably Thursday. Union leaders said they'd recommend the new two-year contract, and expected it to be approved.

Initially, the union planned to vote Monday afternoon and celebrate publicly in front of City Hall. But that vote and the attending festivities were pushed back after a last-minute glitch.

A Sunday afternoon verbal settlement between a few union members and the city's lead negotiator needed more time to be hashed out, following a supposedly minor -- but frustrating -- snag that both sides decided to keep secret.

The final agreement was also confidential as the Weekly went to press Tuesday.

In the end, it took nearly four months of private negotiations -- including more than 30 hours in the last week alone -- for the city and union to avoid a strike that likely would have disrupted numerous beloved and vital city services.

Many community facilities, like libraries and the children's theatre, probably would have been closed during a strike. Other services, especially utilities, would have run with less manpower.

The union members are primarily workers who perform the city's day-to-day functions. They check out library books, handle 911 calls, repair utility lines and clean toilets and tennis courts. Their most recent contract expired May 1.

The union handed the City Council a strike notice two weeks ago, and workers could have gone on strike as early as Friday, June 25. Union leaders also sent letters to major employers and neighborhood groups warning them a strike could occur.

The union and city held an 18-hour negotiation on Monday, June 21 and a 12-hour meeting Thursday, June 24. Many expected an agreement by the end of that week, but when the city placed its "last, best and best offer" on the table there were a few issues that apparently remained unresolved. That led both sides to say a strike was possible, whether out of posturing or genuine fear.

The relief on both sides of the table was palpable Monday morning when it was thought there was enough agreement to move forward immediately.

"I think everyone was relieved we found a way to get to yes," City Manager Frank Benest said.

"We are happy we did not have to take them to the strike place, because nobody wanted that," said Maya Spector, the chair of the union's chapter and a senior librarian on Monday morning.

But that euphoria was more tempered Monday afternoon, after the contract had to be re-examined. "It was not that it was derailed -- it just needed to be done in a slower and different way," Spector said.

The city manager released a draft of the contract on Monday morning. It was unclear what terms, if any, could be different in the agreement when the union votes tomorrow.

Under the initial settlement, the union would have deferred a pay raise this year and gone without the retirement package it sought. In exchange, workers would keep the highest-end, most expensive PPO health care plan as an option, and avoid having to take three days off without pay next year.

For the city's leaders, proposed cuts to benefits were primarily about saving money since -- like most California governments -- Palo Alto is facing a third year of declining revenues.

For the union, the negotiations were also about strengthening its unit and protecting its most "vulnerable" employees. For instance, the union would have more oversight on jobs that are "contracted out," under the draft arrangement.

The toughest issue to resolve was health care, both sides agreed. With costs rising, city leaders wanted workers to no longer have the option to join an expensive PPO health care plan, offering instead plans that were less expensive and less comprehensive. Under the initial agreement, though, the city would have kept the top-level, most expensive PPO plan as an option for those who need it most, while offering incentives for workers to switch.

The city, though, did win the right to start a two-tier retirement plan for new hires.

Currently, the city pays 100 percent of the costs for the retirement benefits for many new employees, even if they retire their first day on the job. Starting in January, under the original draft agreement, a new worker would have to be in Palo Alto for at least 10 years before the city paid retirement benefit costs.

Also under the initial agreement, union members would receive no raise next year, but would get a 3 percent pay increase the following May and an additional 1 percent jump the next January. Some workers would get an immediate increase in pay, to make their salaries more in line with employees holding similar jobs in other local governments.

The union began negotiations asking for a 6 percent pay increase. "You've got to start somewhere," Spector said.

The city also agreed to pass on a proposal to make every worker take three days off next year without pay. The city instead assented to make that voluntary. The union would need to save the city an equivalent amount of money -- approximately $460,000 -- through the voluntary furlough.

The union also wanted a promise of no layoffs, another source of tension. "We could not guarantee no layoffs because of our financial situation," Benest said. Ultimately the city agreed to meet with the union "in good faith" before announcing any layoffs. No layoffs are expected.

The union also got the city to agree to meet in the upcoming year about the benefits that long-time temporary workers receive. Employees who work less than 1,000 hours a year currently don't get benefits, even though there are 50 who have worked in the city since 1997, according to union officials.

Staff Writer Bill D'Agostino can be e-mailed at bdagostino@paweekly.com

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