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Repeal PERA


End Collective Bargaining for State Employees

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Repeal PERA

PERA is the Public Employment Relations Act. As amended in 1965, it requires public schools and local governments to bargain collectively with employee unions. As originally enacted in 1947 (Public Act 336, the Hutchison Act), it did little more than ban strikes by public employees. It made no mention of collective bargaining. Until 1965, there was no collective bargaining for Michigan's public employees. The National Labor Relations Act of 1935, which established collective bargaining nationwide, does not apply to government employees.

You can read PERA as originally passed in 1947 here and in its current form here

Here is a discussion of PERA on the Michigan Education Association's website.

PERA does not cover state classified employees. Section 4a if the Act says:

The provisions of this act as to state employees within the jurisdiction of the civil service commission shall be deemed to apply in so far as the power exists in the legislature to control employment by the state or the emoluments thereof.

PERA is administered by the Michigan Employment Relations Commission (MERC).

Petition Language

Our petition states simply:

This proposal repeals Act 336 of 1947, Public Employment Relations, and voids all employment contracts made under that law.

Repealing the Act - rather than changing it - means that public schools and local governments are no longer required to bargaining collectively with their employees. At the same time, however, it ends the Act's prohibition of strikes by public employees. As long as there is nothing to prohibit public employers from firing strikers, we see no need to prohibit strikes.

In addition to repealing the Act, the proposal voids all contracts made under the Act with the understanding that employers could reinstate them or negotiate new contracts. We do not wish to ban schools and local governments from engaging in collective bargaining for a couple of reasons. One is the "home rule" principle: local governments and schools should be allowed to act in these matters without state interference. The second reason is that if some continue to engage in collective bargaining and some don't, we will be able to compare the results with the expectation that those that do not bargain will fare better.

A draft the petition form has been prepared.

The effective date of a legislative initiative is 10 days after the date of the official declaration of the vote (Article II, Section 9 of the Michigan Constitution.)

Why Repeal PERA?

We have 3 objections to government unions:

  1. They obtain wages and benefits for government employees that are well above the market rate, increasing the cost of government - and our taxes.

  2. They interfere with a government entity's authority to make policy decisions and conduct business as it sees fit.

  3. In the form of union dues, they take money from government employees - money that comes ultimately from the taxpayers - and use it for union administrative expenses and political activities.

Excess pay. The market wage is what government employers would pay if they paid no more than necessary to get qualified employees. The purpose of a union for government workers is to get above-market wages for their members, just as unions do in the private sector. The difference is that for government workers, the excess wages are paid for by the taxpayers, and they can't be rationalized by claiming that workers are just getting their share of the profits earned by a fat, arrogant corporation.

The Mackinac Center, a conservative think tank based in Midland, has published several reports showing that public sector compensation in Michigan is substantially higher than for comparable private sector jobs:

And there was this 2007 report published by the American Legislative Exchange Council. It was co-written by the Mackinac Center's Michael LaFaive:

What Price, Government? Michigan’s Financial Crisis: A Case Study

Excess pay for government workers means tax increases, or when tax increases are politically impossible, reduced funding for government programs. It even hurts government employees by increasing their workload to make up for cutbacks in staffing.

Diminishing the people's sovereignty. This is a democracy, so (in theory) our elected officials and government administrators are carrying out the will of the people. They are authorized to act on our behalf. Michigan's Public Employment Relations Act: Public-Sector Labor Law and Its Consequences, a September 2, 2009 "policy brief" from the Mackinac Center, found that collective bargaining infringes upon our leaders' authority to make policy. Quoting from the Executive Summary:

  • Work rules found in collective bargaining agreements add to the scope of the “union veto.” In practice, government union negotiators can manipulate any political issue that can be expressed in terms of employee compensation, job duties or work standards and be included in a collective bargaining agreement.

  • Court rulings have consistently held that collective bargaining trumps local statutes and even local charters. PERA has arguably subverted the home-rule principles expressed in the state constitution.

The same issue was addressed way back in 1987 by the Citizens Research Council of Michigan. This is from the introduction to a report titled The Public Employment Relations Act: Conflicts and Possible Alternatives:

Local governmental units in Michigan are accorded powers of home rule by the state Constitution . . . One of the tenets of home rule is that the electors of a charter unit be accorded the flexibility to shape their local government structure as their needs require, subject of course to the Constitution and general law. Conflicts between the constitutional right of home rule and the constitutional authority of the Legislature to provide for the resolution of public sector employment disputes through statewide law have proven difficult to resolve. Constitutional conflict has also arisen between the autonomy guaranteed to the state’s public higher education institutions, by Sections 4 through 6 of Article 8 of the state Constitution, and the Legislature’s authority to provide for collective bargaining for public employees, including those employed by colleges and universities.

Buying politicians. The people ultimately responsible for setting wages of public employees are politicians: state legislators, school boards, county commissioners, city councils. They are elected to their positions, and need money to run their campaigns. This creates a special relationship between unionized public employees and the politicians: politicians are generous with public employee salaries; those salaries enable unions to extract hefty dues from unionized employees; unions use those dues to contribute to the campaigns of friendly politicians. Here are the dues collected from State of Michigan employees in 2008 and 2009:

  2008 dues   2009 dues   Change
MI St. Employ. Assn/AFSCME Local 5 $2,187,813.60   $2,237,746.82   +$49,933.22
UAW Local 6000 $5,838,655.20   $6,053,182.92   +$214,527.72
MI Corrections Org./SEIU 526M $4,959,645.28   $4,840,725.89   -$118,919.39
SEIU 517M $2,433,129.78   $2,721,664.04   +$288,534.26
MI St. Police Troopers Assn. $1,125,395.91   $1,182,965.34   +$57,569.43
AFSCME Council 25 $1,050,559.04   $1,056,008.47   +$5,449.43
Totals $17,595,198.81   $18,092,293.48   +$497,094.67

The above information was obtained by the Mackinac Center and reported in the 2/25/2010 article State Government Employee Unions Prosper in Midst of Recession. The article also says that union dues for the average employee are $469.64 a year.

State employee unions don't have to spend much on member services. The state Civil Service Commission already gets an amount equal to 1% of the aggregate payroll of the classified service for the preceding fiscal year to carry out its duties, which include fixing rates of compensation, making rules and regulations covering all personnel transactions, and regulating all conditions of employment. That leaves little for the unions to do to earn their $18 million. Aggregate payroll for fiscal year 2009 was $4,781,203,263, which means Civil Service's allocation for 2010 was $47,812,033.

For the UAW, it is easy money that makes up for their losses in the private sector. UAW membership totaled 355,191 at the end of 2009, down from 1.5 million members at its peak in 1978.

The Michigan Education Association (MEA) and the United Auto Workers (UAW) PACs are among the top ten spenders on statewide campaigns, and from 2005-2008, the UAW PAC was by far the largest contributor to candidates for Lansing mayor and City Council and the Ingham County Board of Commissioners.

Ordinarily, unions spend more on representing workers in the workplace than they spend on political and lobbying activities. During the 2008 elections, however, two unions reported spending more nationwide on politics than on representation:

  Worker Representation

Politics and Lobbying

American Federation of State, County and Municipal Employees (AFSCME)



National Education Association (NEA)



More on unions and collective bargaining can be found at www.steveharrypublicpolicy.com.