Memorandums of agreement with two unions approved with salary and co-pay increases

City employees belonging to two unions will receive salary increases, but will also have to contribute more towards their health care under changes specified in two memorandums of agreement which were approved by the common council at Tuesday’s meeting.  The agreements are subject to ratification by each of the unions. The first memorandum was between the city and the Civil Service Employees Association (CSEA) representing city hall employees, and the other with the United Public Service Employees Union (UPSEU) representing city department heads.

The terms of the CSEA agreement would apply retroactively to July 1, 2016, extending to June 30, 2021. Employees would not receive any retroactive salary increases from July 2016 through 2017. Salary increases would begin retroactively starting January 1, 2018 according to the following schedule:

  • 1% increase effective January 1, 2018
  • 1% increase effective July 1, 2018
  • 1% increase effective January 1, 2019
  • 2% increase effective July 1, 2019
  • 2% increase effective July 1, 2020

Additionally, the memorandum states that employees under the contract will now be paid bi-weekly and by mandatory direct deposit.

Co-pays for health services would be set to the following schedule effective July 1, 2019:

  • $20 – Primary Care Physician
  • $20 – Urgent Care
  • $75 – Emergency Room
  • $50 – Outpatient Surgery
  • $150 – Inpatient
  • $50 – High cost imaging (MRI, MRA, CAT, etc.)

Effective July 1, 2020, the emergency room co-pay would increase to $100 and the inpatient co-pay would increase to $200

The terms of the UPSEU agreement would apply retroactively to July 1, 2017 and follow the same salary increase schedule as the one for CSEA listed above.

Health services co-pays would also be set at similar rates as CSEA, with the exception of the inpatient co-pay which would be set at $200 in 2019.

Both memorandums indicate that employees hired prior to the ratification of the agreement would contribute 10% toward the health insurance premium, and employees hired after ratification would contribute 15%.

The CSEA agreement indicates that for retired employees hired between July 1, 1988 and February 9, 1998, the city would cover the full cost of the individual’s health insurance, and 50% of the cost of a 2-person or family coverage. Retired employees hired after February 10,1998 would pay the same premium as they did while they were employed.

The UPSEU agreement would remove a paragraph in the prior contract that states the cost of any increase in health insurance premiums above the year 2012-2013 will be split evenly between the employees and the city.

Yesterday, Mayor Michael Villa credited Employee Relations Director Pat Beck and the Roemer, Wallens, Gold, and Mineaux Law firm for their work on the negotiations. He also described the union’s stance during the negotiations as “very cooperative” and said the agreement is a “win-win” for both the city and the unions.

Villa said the savings to the city from changes to bi-weekly, direct deposit payroll as well as increases to insurance co-pays and other health insurance terms will outweigh the salary increases over the term of the contract.

“The overall monetary value of what [the city] got is far more than 7% [raises] factored over five years,” said Villa.

In regards to the impact of the raises on the city budget, Villa said, “Two percent raises have been budgeted for every year since I’ve taken office [in 2016].”

Villa said the new schedule of co-pays is a significant step in addressing the rising cost of healthcare which has been a strain on the city’s self-funded health insurance program.

For instance, he said that the previous co-pay structure in some union contracts had the same amounts for urgent care and emergency care, even though emergency care is many times more expensive.

“You want to encourage your workers to go to urgent care because the cost is so drastically lower,” said Villa. “You want to discourage the ER unless it’s really an emergency.”

Villa said he expects an agreement for wastewater facility employees to be ready soon, followed by agreements for police, firefighters, and public works employees.

Editor’s note: Qualifying the exact impact the new union contracts will have on the budget requires looking at the terms of the previous contracts for each union. Details of previous contracts were not immediately available from city officials at the time of publication for this article, but I hope to offer further analysis once that information is obtained.

Tim Becker

Tim Becker is the owner of Anthem Websites Inc. which publishes The Compass. He serves as both editor and a writer.