Management & Labor

Are States Keeping Their Promises for Pay Raises?

In several states, public employees anticipated pay raises this year. But in some states, all they're left with is disappointment.
by | April 17, 2014
Tennessee Gov. Bill Haslam giving his 2014 State of the State address.
Tennessee Gov. Bill Haslam proposed pay raises for state employees and teachers earlier this year, but eventually nixed them from the final budget. AP/Mark Zaleski
 

Last month, Leslie Scott, the executive director at the National Association of State Personnel Executives (NASPE), offered some thoughts on what state employees might expect this year in terms of hiring, pay and benefits. This month, we explore some states that are already taking action on these issues and whether it’s helping or hurting public employees.

Washington State 

In February, Gov. Jay Inslee announced that he was considering raising the minimum wage for state workers and contractors. At the time of his announcement, legislators were considering bills to incrementally raise the statewide minimum wage for all workers in both the public and private sector to $12 by 2017. The state already has the highest minimum wage in the country (for now) at $9.32 per hour. But by the end of the legislative session in mid-March, the bill had not yet passed out of the Appropriations Committee. Rather than wait until the next legislative session to take up the issue again, Inslee said he believed he could raise the minimum wage for state workers through an executive order and called on the Office of Financial Management to look into the impact of such an increase. The governor has yet to say how he might proceed or what he would set the state employee minimum wage at.
 

Virginia

In late March, Gov. Terry McAuliffe called the Virginia legislature into special session to pass a two-year budget that he said should include a 2 percent pay raise for almost all full-time state employees, at a cost of approximately $200 million. The governor didn’t say how the increase would be paid for, but if passed, it would take effect in March 2015. The Republican-led House’s initial budget proposal contained a 1 percent bonus in 2015 to be followed by a 1 percent raise in 2016. The Senate passed a budget including the 2 percent pay raise, but the bill was rejected by the House because of disagreement over how to deal with Medicaid expansion.
 

Oklahoma

On March 11, the Oklahoma House of Representatives passed a bill that would increase state employees’ salaries to at least 90 percent of their private-sector counterpart’s salary over the next four years. According to the bill’s author, the intent is to make state government a more attractive place to work since research on the state currently shows that private-sector workers earn 20 percent more in similar positions. To work toward this goal, the bill would give targeted pay raises, starting with the state’s lowest paid workers. It still awaits passage by the Senate and approval by the governor.
  

North Carolina

In an effort to reduce turnover, the state gave 4.2 percent pay raises to slightly more than 3,000 employees in high-demand jobs in fields like auditing, accounting, information technology and medicine. The state’s budget allocated more than $7 million to help bring public-sector pay closer to private-sector compensation.
 

New Mexico

Last year, for the first time since 2008, all state employees received a 1 percent pay increase. Just last month, they received another, even bigger bump. State employees in classified jobs with civil service protections and public school employees on average got a 3 percent pay increase, while prison guards, child protection workers and state police got an even bigger one. Appointed state employees were also expected to receive a 3 percent pay increase, but Gov. Susana Martinez used her line-item veto to eliminate that item from the legislature’s budget.
 

Maryland

In February, state employees reached an agreement on a one-year contract that would give a 2 percent COLA pay raise and some other financial benefits including maintenance of step increases to eligible employees based on their pay grade and health premium holidays. The Senate’s budget, which was sent to the House of Delegates in mid-March, honored the 2 percent COLA, a year of merit raises and would allow another four pay periods for employees to skip paying health insurance premiums. The two chambers agreed to a compromise bill the first week of April that kept these provisions in place.
 

Kentucky

In January, Gov. Steve Beshear proposed the first state employee pay raise in four years. The pay increases would range anywhere from 1 percent to 5 percent, depending on the current pay rate of each employee (lower-paid employees would receive larger increases and vice versa). Following a two-week recess, the Assembly and Senate approved a final budget on April 16 that included the governor's pay raise proposals. 
 

Mississippi and Tennessee

Despite lawmakers' best intentions, there wasn’t enough room in the Mississippi and Tennessee budgets to cover expected employee pay raises. In Mississippi, Democrats in the House pushed for at least a $1,000 pay raise for each employee, but the $39 million price tag was too high. “We wanted to do it. And we ran out of money,” said Appropriations Committee Chairman Herb Frierson in a floor statement. 
 
In Tennessee -- where tax revenues lagged behind predictions -- Gov. Bill Haslam announced that the 1 percent pay raises for state employees and 2 percent pay increases for teachers that were included in his initial February budget would be nixed, saving the state an estimated $72 million in next year’s budget. But there’s still hope: The governor said he only intended to delay the raises by one year. 

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