July 20, 2014 Andrew V. Lalonde Labor Relations Coordinator Madison Oneida BOCES

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NEW YORK STATE ASSOCIATION OF MANAGEMENT ADVOCATES FOR SCHOOL LABOR AFFAIRS, INC.

37th Annual Summer Conference

BARGAINING TRENDS AND “HOT” ISSUES

July 20, 2014Andrew V. Lalonde

Labor Relations CoordinatorMadison Oneida BOCES

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Teacher Salary Statistics in NYS

* The median salary of a starting teacher with a Master’s Degree in NYS is $43,928.00.• The median salary of a teacher with twenty (20) years

of experience is $69, 460.00.• The lowest starting salary for anew teacher with a

Master’s Degree in NYS is $37,946.00.• The highest starting salary for a new teacher with a

Master’s Degree in NYS is $110,568.00.(NYS Teacher Salary Report: Cornell ILR School (Dec. 2013)

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Teacher Salary Statistics in NYS

• However, teachers with similar qualifications and experience in:• A. Finger Lakes Region• B. Southern Tier• C. Mohawk ValleyMake on average forty percent (40%) less that their downstate peers.

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Teacher Salary Statistics in NYS

• Teacher earnings vary greatly depending on:a. Longevityb. Where a teacher works

Example:(1) A new teacher with a Master’s Degree first employed in a school district on Long Island on average starts with a salary equal to the median salary of a teacher in the Finger Lakes Region of the State with twenty (20) years of experience.

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Teacher Salary Statistics in NYS• (2) At the same time, a starting teacher with a Master’s

Degree who is hired for a school on Long Island on average would make more than a teacher with twenty (20) years of experience in the Southern Tier Region of NYS.

• On a more positive light, the National Education Agency reports that teachers in NYS offer the sixth (6th) best starting salary to beginning teachers in the nation ($41,079), and the overall best average teacher salary ($69,118). The NYS Education Department reports the average to be $70,518.00.

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Teacher Salary Statistics in NYS• With respect to the issue of EXPERIENCE:

(1) The median salary of an entry level teacher employed on Long Island is $58, 299.00.

(2) The median salary of an entry level teacher employed in Central New York is $44,017.

(3) The median salary of a teacher employed on Long island with twenty (20) years of experience is $106,505.00.

(4) The median salary of a teacher with twenty (20) years of experience in Central New York is $56,487. which reflects an approximate 28% increase in salary over the twenty (20) year period.

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Teacher Contract Settlements in NYS

The NYS School Board Association’s 2013 Teacher Salary Survey reported an average salary increase, exclusive of step, of:• 2011-2012: 1.59%• 2012-2013: 1.67%

• As for Health Insurance contributions, the Survey found that teachers pay less than 14% of health premiums:

• Individual Coverage: New teacher: 11.9%Veteran Teacher: 10.8%

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Teacher Contract Settlements in NY

• Family Coverage:New teacher: 13.3%Veteran teacher: 12.1%

• Health Insurance Premiums: (average)Individual: $7313.00Family: $17,862.00

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NYSSBA Survey Profile: 2013

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Teacher Salary Information

• RocDocs.com• Salary.com• SeeThrough.NY (contracts)

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Contract Negotiations are Taking Longer

In 2013, a survey conducted by the N.Y.S. School Board Association reported that the average time required to negotiate a new collective bargaining agreement was two hundred and ninety-four (294) days.

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Contract Negotiations are Taking Longer

Impact:

1. Continued salary and benefit payments due to Triborough.2. Inability to affect changes in district health insurance plans

and premiums.3. Delays in negotiations serve to avoid the Union

addressing/paying additional costs for health insurance.4. Inability to make changes in contract.5. Morale.6. Inability of school districts to address changes, both

administrative and financial.

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School Districts Continue to Struggle with Rising Health Insurance Costs

• Health insurance premiums are increasing on average between 5.6% and 6% annually.

• Impact of the Affordable Care Act of 2010 on district health insurance programs, costs, employee rights, and options.

• It is projected that a fifth of school districts in New York State could be impacted by the Affordable Care Act “Cadillac Tax” when it goes into place in 2018.

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School Districts Continue to Struggle with Growing Health Insurance Costs

• 1. The Cadillac Tax will apply to health insurance premiums that exceed certain dollar amounts:a. $10,000.00 for an individual health insurance plan.b. $27,500.00 for a family health insurance plan.2. Employers will be required to pay a forty percent (40%)

tax in excess premiums for each participant in a health insurance plan.

3. The New York State School Board Association projects that the total tax on affected school districts and BOCES in New York State in 2018 will exceed 22 million dollars.

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School Districts Continue to Struggle with Rising Health Insurance Costs

RETIREE HEALTH INSURANCE • 95% of school districts and BOCES provide

health insurance benefits to retirees.• On average school districts pay more than 2/3 of

the cost of retiree health insurance costs.• The cost of “Pension Liability” has been

estimated at approximately 150 Billion Dollars.• (E.J. McMahon, “Public Sector, Inc.” (6-16-201_)

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School Districts Continue to Struggle with Rising Health Insurance Costs

Retiree Health Insurance:Problem:

1. NYS law restricts the ability of public employers to sequester money in trust funds to pay for future retiree health insurance cost.

2. Ultimately school districts are left to have to “pay as you go.”

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School Districts Continue to Struggle with Rising Health Insurance Costs

• Retiree Health Insurance• The average time requirement in labor

contracts is for an employee to have to work five (5) to fifteen (15) years to qualify for health insurance.

• Vast majority of New York taxpayers who work for private firms do not obtain ANY retiree health insurance coverage.

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School Districts Continue to Struggle with Rising Health Insurance Costs

Retiree Health Insurance

• Ability to make changes:1. Used to be governed by State moratorium language that limited

increases to those made to active employees.2. Court of Appeals in 2013 . In the Matter of Kolbe v. Tibbetts, ruled:a. As a Union no longer represents a retiree;b. A collective bargaining agreement cannot diminish an established

premium and contribution right of a retiree;c. Once parties specify percentage of employee premium at time of

retirement.Result: Important for school districts to negotiate in contract for future retirees.

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Health Insurance Options

• Reviewing alternate health insurance plans and options, as well as health savings accounts and health reserve accounts.

• Fund employee contributions to state offered plans under the Affordable Care Act.

• Blue Cross/Blue Shield is developing plan options comparable to those offered through the Affordable Care Act.

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Other Retirement Benefit Costs

• It is projected that New York State and its local governments and schools districts are exposed to at least one (1) trillion dollars in post-employment benefits.

• It is further projected that the Tier 5 Pension “Reform” Law has locked an estimated thirty-eight (38) billion dollars of long-term benefits to school districts alone.

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Other Retirement Benefit Costs

• In 2013, more than 142,000 teachers, teaching assistants, guidance counselors, and administrators drew a pension from the NYS Teachers’ Retirement System.

• The number of retirees increased by nine percent (9%) between 2010 and 2013.

• The average pension grew by 5.6% over this same time period.

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Other Retirement Benefit Costs

• For the 2014-2015 school year, school districts will pay a 20.1% of employee payroll to the State Employees’ Retirement System (ERS), down from 20.9% in the 2013-2014 school year.

• District costs into the Teachers’ Retirement System for the 2014-2015 school year will, however, rise from 11.84% to 16.25%, a 37% increase.

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The Impact of the State Cap on Budget Increases on School Districts

• School districts statewide have proposed for the 2014-2015 school year an average tax levy increase of 1.98%.

• 96% of school districts proposed tax levy increases at or below their tax levy limits.

• For the 2014-2015 school year, its is estimated that school districts will use approximately 1.2 billion dollars in fund balances to lower school taxes.

• The largest element in projected school spending increases will be to district contributions to (1) employee retirement plans, and (2) health insurance increases.

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Shared Services Becoming More Widespread

• According to a Survey of School Business Officials conducted by the NYS School Boards Association in May of 2014, approximately 2/3 or approximately 65% of those who responded to the survey reported that their school districts plan to share services with other districts in the 2014-2015 school year.

• The most common areas in which school districts are sharing services include: Transportation, Athletics, Special Education, Technology, Business functions, and Food Service.

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School Mergers

• Number of studies being performed in school districts and local government levels.

• Union impact/involvement/support. Questions of job loss and loss of contracts.

• Potential impact on unions themselves.• Since 2000 five (5) successful mergers.• Since 2010 thirty (30) schools (15 merger proposals)

have been rejected.• Two (2) studies identified as currently ongoing in 2014.

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Other Issues Affecting Labor Negotiations

• Impact of Charter Schools1. Financial.2. Impact on student populace and

enrollment.• Layoffs

1. Class sizes.2. Increased unemployment benefits3. Potential impact of increased workers’ compensation

claims.

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Other Issues Affecting Labor Negotiations

• Expanded school days.• Outsourcing.• Privatization.• Impact of Technology.

1. Virtual classes.2. Use of technology in the classrooms.

• Availability of Bus Drivers in Rural School Districts.• Employee absenteeism.• Changes to job titles.

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Other

• Questions?