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Get retiree health care insurance out of the collective bargaining process July 25, 2018
This is a follow up to my July 20 story, McIntyre disagreed with Bernero on retiree health insurance premiums. It was about a group of City of Lansing retirees who the City started charging for health insurance premiums in 2010, years after they retired believing the City would pay 100% of their premiums. That happened under the Bernero administration, but new mayor Andy Schor reviewed the matter and said in a March 15 letter to city council's Ways and Means Committee:
I don't think he is "bound" at all. He is, after all, the mayor. As we learned in the July 20 story, Bernero ignored the legal opinion of Janene McIntyre, his city attorney. Schor could have chosen to reimburse the retirees for the premiums deducted these last 8 years and found another way to balance the budget. I can think of no one who would have objected.
Balancing the budget is difficult, and cutting retiree heath care insurance should be considered. But rather than targeting one group, why not spread the burden equally to all City retirees? The Financial Health Team had some suggestions:
Retiree health care insurance should be taken out of the collective bargaining process and made the responsibility of City Council. Collective bargaining agreements expire every 4 or 5 years, and with a new contract, everything promised retirees in the old contract is out the window. The City could promise 100% coverage in one contract, partial payment by retirees in the next, and no help at all from the City in the next. While City Attorney Jim Smiertka says in his July 31, 2017 memo that contractual obligations will cease ... upon termination of the bargaining agreement, he also says that any promise of lifetime benefits must be stated in clear and express language, which suggests that such promises can be enforced beyond termination of the contract. However, it is unlikely in these times that any employer would agree to such a promise.
Another problem with promises in CBAs is that CBAs are not easily accessible by retirees. For some reason, they are not available to the public on the City website. They are on the City's internal website, but even then they may not be up to date, as Councilmember Carol Wood reported at an October 9, 2016 Ways and Means Committee meeting. And there is no procedure for notifying retirees of contract changes that affect them. In fact, going by this discussion in that October 9, 2016 Ways and Means Committee meeting, City Council itself has little idea what is in the collective bargaining agreements they are required by the city charter to ratify:
(Ms. O'Berry is with the city attorney's office and Ms. Bennett is the Finance Director.)
Establishing retiree health insurance by ordinance would bring the process into the open, allowing citizens, employees and retirees to make their wishes known, and the final product would be immediately available on the City's website, rather than "years" later, as Carol Wood noted above.
Pensions are protected by the state constitution, retiree health care coverage is not. Active employees are protected by unions, retirees are not (they don't pay dues). Someone needs to look out for retirees. That has to be City Council.
Send comments, questions, and tips to stevenrharry@gmail.com, or call or text me at 517-505-2696. If you'd like to be notified by email when I post a new story, let me know.
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