Employee Groups Benefits vary among the 3 employee groups at BWL:
In a letter to the BWL, I asked if all hourly employees are bargaining unit employees and vice versa, but didn't get an answer. I did get a list of the non-bargaining unit exempt positions. Wage Increases Hourly employees at BWL are represented by the International Brotherhood of Electrical Workers (IBEW) Local 352. Their latest contract, effective November 1, 2008, provides for 3% wage increases effective November 1 each year 2008-2011. In a letter to the BWL, I asked by what percentage pay is being increased for non-bargaining employees and executive officers in each year 2008-2011. BWL's 10/13/09 reply was:
I don't have enough information to calculate the annual cost of these pay increases. I don't know which employees are IBEW members, who get 3% raises, and which are non-bargaining unit employees, who get 2% raises. Let's say half are IBEW, half are non-BU. I'll use an average increase of 2.5%. Total payroll for 2008 was a little over $52 million. 2.5% of $52 million is $1.3 million. Are these increases justified? They are not tied to the inflation rate. Are they necessary to hold on to current employees and attract new ones? In an hour and 15 minute video of a 2/26/2009 interview with the Lansing State Journal's editorial board, Peter Lark justified generous employee benefits by telling how difficult it is to attract qualified lineworkers. But that problem could be solved by increasing the pay rate for lineworkers. Here are all the BWL employees who have "lineworker" in their job title (my guess is that the "App" in App Lineworker means apprentice):
Health Insurance The health insurance plan is the same for all employees. Employees are charged with 5% of the premium. The annual deductible is $150 for an individual, $300 for a family. Co-pays are $150 for an emergency room visit, $10 for a doctor visit, $5 for generic drugs, and $15 for brand name drugs. Dental and vision insurance is also provided. The deductible for dental is $100 for an individual, $200 for a family. Paid Time Off All employees get 10 holidays. Non-bargaining unit employees are allocated vacation time as follows:
Vacation time is the same for bargaining unit employees except they get only 5 days after the first year. In addition to vacation time, all employees get 6 days of "free choice" time each year. I haven't been able to find any difference between free choice time and vacation time. So, with 9 years of service, an employee could take August off each year (August has 21 work days: 15 days vacation and 6 days free choice adds up to 21). An exception to normal vacation policy was made for General Manager J. Peter Lark in his initial employment agreement. He got 5 weeks (25 days) vacation in his first year. Bonuses In material I have received from BWL, there are references to an “individual variable pay bonus” and an “annual bonus tied to organizational performance”. In response to my inquiry, however, I've been told that there is no variable pay bonus and the program with an annual bonus tied to organizational performance was discontinued in 2002. The only other bonus I've been able to find is the Exceptional Achievement Award. Available only to non-bargaining unit employees, its purpose is to recognize outstanding achievement. Employees are nominated annually for the award by managers and directors. The awards are worth up to $1000. Overtime The IBEW contract provides for overtime to be paid at a rate of 170% of the regular rate. This is for working more than 8 hours in a work day. For holidays, call-ins and for working more than 12 hours continuous, the rate is 200% of the regular rate. These rates are very generous; state and federal law require only that overtime be paid at a minimum rate of 150% ("time and a half"). Non-bargaining unit, non-exempt employees get overtime also. Exempt employees do not. I assume this from the fact that the employer contribution to the defined contribution plan for exempt employees is 3% more than for others, and the reason given is that they don't get overtime. It would be interesting to know if an employee is allowed to schedule vacation or free choice time and then work that time at the overtime rate. Overtime seems to be the main reason actual earnings exceed salaries. In a FOIA request, I asked for a breakdown of 2008 earnings for 2 salaried employees and 2 hourly employees, all of whom had 2008 earnings far higher than their salaries:
Pension Plans BWL has a defined benefit plan, but a defined contribution plan was created in 1996 and anyone hired 1/1/1997 or after had to participate in the DC plan. Employees hired before 1/1/1997 had the option to convert from DB to DC, and 602 of 760 employees did so. Defined Benefit. The monthly pension is "annual pay" times years of service times 1.8% divided by 12. Annual pay is 'base pay" plus any annual bonus - up to 5% of base pay - which is tied to organizational performance and received in the last 12 months. Base pay is the highest salary received in the last 10 years. For hourly workers, salary is computed by multiplying hourly rate by 2080. Employees can retire at age 60 or at 55 with 30 years of service. State employee pensions are calculated in a similar manner except the multiplier is 1.5% instead of 1.8% and the counterpart of "annual pay" is final average compensation (FAC), the average of the employee's highest three consecutive years of compensation. That compensation includes gross wages earned, up to 240 hours of annual leave and compensatory time paid at retirement, performance pay, and longevity pay earned during the FAC period.
Defined Contribution.
As mentioned above, everyone hired 1/1/97 or after gets DC rather than
DB. At that time, the DB people had the option to convert. The employer
contribution to the DC plan is a percentage of earnings, exclusive of
bonuses and overtime, and it varies depending upon whether the employee
is a convert from DB, whether the employee is bargaining unit or non-BU,
and whether the employee is exempt or not:
The extra .5% received by non-BU, non-exempt employees and the extra 3.5% received by non-BU exempt employees is 100% vested from the start, which means (I think) that it can be withdrawn immediately. The rest is subject to the following vesting schedule:
Employee contributions to the DC plan are not permitted. Note: There is one non-BU, exempt employee hired after 1/1/97 for whom the BWL's DC contribution is a whopping 15%. That would be General Manager J. Peter Lark. It is a provision of the new contract he got after his first year. Deferred Compensation. BWL contributes $1000 to each employee’s deferred compensation account on the first pay day of the year, regardless of whether the employee contributes. Then BWL contributes $.75 for every $1.00 of employee contribution in excess of $1000, up to a total employer contribution of $1500. So to get the maximum $1500 employer contribution, the employee would have to contribute $1667 (75% of 667 is 500). The employee contribution is limited only by the IRS. The federal maximum combined contribution for 2009 is $16,500. Employees over age 50 can contribute another $5500, and in the 3 years before normal retirement, the maximum is $33,000. Home Ownership Incentive This program encourages employees to buy homes within Lansing city boundaries (provided they don't already own one there) by granting them $5000 at closing. The initial 7/2/07 employment agreement for General Manager J. Peter Lark also provides for up to $5000 in relocation expense reimbursement. He has, however, continued to reside in Okemos. |