Before Right-to-Work Begins, Michigan Unions Rush to Sign Contracts

All over Michigan, public employee unions are scrambling to cement long-term contracts with school districts, higher education institutions and local units of government before the state’s right-to-work law takes effect March 28.
by | March 22, 2013

By Melissa Maynard

All over Michigan, public employee unions are scrambling to cement long-term contracts with school districts, higher education institutions and local units of government before the state’s right-to-work law takes effect March 28. In doing so, unions have once again stirred the wrath of GOP lawmakers.

The law will prevent unions from including “union security clauses” in their contracts that require employees to pay fees covering the cost of their representation regardless of whether they choose to be a dues-paying member. Because the law doesn’t apply to contracts already in place, public employee unions have had a window since its passage Dec. 11 to bargain with their employers.

Some have secured contracts that will delay the law’s impact for a decade.

Lawmakers in the Republican-controlled legislature are incensed by what they see as efforts to circumvent the law and are considering severe financial sanctions for educational institutions that participate.

"There's some pretty frenetic activity going on where unions are trying to secure long term contracts to throw their members under the bus and prevent them from having a choice," said Republican state Rep. Mike Shirkey, a key sponsor of the right-to-work law. He said supporters didn’t have the votes necessary in December to make the law effective immediately, but didn’t anticipate at the time that unions would resort to “acts of desperation.”

Race to Beat Deadline

Union leaders say it’s unreasonable to expect them to follow a law before it’s actually in place. “For politicians to attempt to enforce a law not yet in effect is no different than them deciding to lower the speed limit to 60 miles per hour starting this summer, but ordering police to start issuing speeding tickets to motorists driving 70 miles per hour starting tomorrow,” Steven Cook, president of the Michigan Education Association, said in a statement.

Although Michigan is the 24th state to pass a right-to-work law, the move was a shock because of the state’s relatively strong union presence and central role in the modern labor movement.

Some of the public employers involved are using lengthy contracts to make overt political statements against the legislation, especially in areas of the state that are dominated by Democrats. In the Ann Arbor area, the Washtenaw County Board of Commissioners passed a resolution Feb. 20 formally condemning the right-to-work legislation as “designed to weaken labor unions and their ability to serve their members” and urging swift repeal. The resolution also directed the county administrator and director of human resources to engage in expedited negotiations with the county’s labor unions.

On Wednesday the Board of Commissioners approved 10-year agreements with unions representing about 700 county employees. Commissioner Andy LaBarre, who authored the resolution, said unions approached the county about expediting the bargaining process and the county was proud to accommodate them. “The unions have been ready and willing,” he said. "We all agreed this rather abhorrent thing presented us both with a deadline we should meet.”

LaBarre said the new bargaining agreements dramatically reduce retiree health care and pension costs and are good for everyone, from taxpayers to the union members who make up the county’s rank-and-file workforce. "They're hearing from their membership that it's going to have a really negative effect on their workforce when you've got the vast majority of folks paying for the benefits and then others tagging along for free,” he said. The length of the contracts is helpful, LaBarre said, because it will provide the county with a greater-than-usual level of stability and certainty about its personnel costs over a 10-year period.

Republicans Strike Back

Republicans in the legislature are not buying the business case for long contracts and have decried the moves as desperate and politically motivated. On Tuesday, House budget panels approved proposals for higher education and K-12 that would reduce state aid for institutions with new collective bargaining agreements, unless that they can prove the contracts will significantly reduce their costs.

Higher education institutions could lose as much as 15 percent of their expected state funding. This includes $27.5 million at Wayne State University in Detroit, which has approved an eight-year contract with its faculty, and $47.3 million at the University of Michigan, which has reached tentative five-year agreements with five of its unions.

A similar bill targeting community colleges was passed by another House panel Thursday.

Shirkey said the budget measures are appropriate as part of the state’s ongoing efforts to use “performance funding” to promote best practices. “We see this as a non-best practice, that is, setting up a very long-term contract that is financially irresponsible,” he said. “Who can predict what the future will hold eight, 10 or 12 years down the road?"

Wayne State University ratified an 8-year contract Wednesday even as the legislature threatened to respond by pushing its state aid down to a level last seen in 1987. Moving forward with the contract was a difficult decision, President Allan Gilmour said, but the right decision because of the contract’s value to the university and uncertainty about whether the threatened reductions will actually become law.

Gilmour said the contract includes high-priority changes involving a new performance evaluation system and merit pay that the university has been trying to get the union to agree to for years. “Oddly enough, the right-to-work legislation helped on this because the union had something that they wanted us to give on," he said, referring to the eight-year length of the contract.

The contract includes annual 1.25 percent raises with up to an additional 1.25 percent for high-performers. But if the university’s funding is lower than expected in the second half of the contract, the university has three opportunities to lower the raises unilaterally. The union also agreed to higher health insurance co-pays and deductibles.

Republican state Rep. Al Pscholka, chair of the House panel that approved the higher education cuts, said the contracts defy common sense and lock the schools like Wayne State into unrealistic terms. “This is a bad deal for students, for parents and for the taxpayers of Michigan,” he said. “If they could have gotten some savings, we wouldn’t have had a problem with it.”

Republican Governor Rick Snyder has not yet indicated whether he would sign the budget measures being considered.

“What I would say is, if people are coming in and bargaining in good faith and showing real benefits, I don't believe people should be penalized,” he said in an interview with MLive. “Now, the real issue would be if somebody were doing that with no substance to simply extend the date, then I could see legislators having a concern."

K-12 Contracts

Similar conversations are taking place in K-12 education. According to the Mackinac Center for Public Policy, a free market think tank, at least 37 school districts have agreed to or extended contracts with their employee unions since right-to-work passed in December. About half of these contracts are short-term and just happened to be up for consideration, said Michael Van Beek, director of education policy at the Mackinac Center, but others are clear attempts to skirt the law and come with great costs for taxpayers.

Van Beek said there are important questions that will probably have to be decided by the courts. “The idea that in an eight-year contract that they would be able to keep everything the same is somewhat laughable,” said Van Beek. Right-to-work should kick in for contracts that are modified once the law is in effect, he said, but the districts involved seem to disagree because of the way they’ve structured their agreements.

The Mackinac Center Legal Foundation has already launched a legal challenge to a contract at the Taylor School District near Detroit. That particular contract is structured as two contracts: a 10-year union security clause, which requires fee payment for all represented members, and a four-year contract laying out the other terms and conditions of employment. The Mackinac Center argues that having two separate agreements with different termination dates violates state law.

State Sen. Hoon-Yung Hopgood, a Democrat, is sponsoring two bills that would repeal right-to-work and has launched an online campaign and petition effort. His daughter attends a school in the Taylor district, and he disagrees with the premise of the Mackinac Center lawsuit.

“This is one of those cases of Taylor schools being in a deficit and negotiating a contract in exchange for substantial concessions,” he said. “It all adds up. It's millions of dollars to help keep the district's bottom line healthy for a number of years.”


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