May 17, 2022 Bargaining Report

Where things stand. The CASE Bargaining Team and CalHR met last Thursday, and the salary lag that shorts families, causes CASE professionals to flee state service, and hampers hiring was the center of discussions. As legal professionals know all too well, disputing parties can disagree most on the issue presented and the facts that should guide resolution.  MOU negotiations present similar challenges. The CASE Bargaining Team has dedicated considerable time to educating CalHR on both the issues and the facts.

Here are the facts. Compared to local jurisdictions where attorneys engage in similar work, using their legal expertise in similar ways with similar goals (serving the public), state legal professionals’ salaries lag by about 30%. The State’s most recent Total Compensation Report also shows a lag, but a much smaller one – 11.7%.  Why is their gap so much smaller? There likely are several reasons, but all can be summarized as an affliction we like to call selective data blindness. And, of course, their 11.7% figure is for Attorneys. Their ALJ figure is . . . not credible (to put it mildly). ALJ comparisons show an even greater salary lag than exists for Attorneys. We’re confident in our numbers. The data is clear – as is the impact. Unit 2 positions are vacant and departments have trouble attracting and retaining top talent.  

Telegraphing expectations. Data clearly shows an average 30% lag in unit 2 salaries compared to peer public sector positions (and ALJs lag even further behind). The US Bureau of Labor Statistics shows record inflation hovering above 8%. CASE’s salary proposal accounts for the documented lag as well as inflation’s impact on Unit 2 families. Though the state has yet to offer a comprehensive economic proposal, CalHR last week acknowledged there is a lag, but stuck to their 11.7% figure. Why would CalHR bother to acknowledge any lag at all on a day they weren’t prepared to present an offer? Because they’ll want applause when they offer something to ease – but probably not eliminate – an 11.7% lag. They won’t get applause.

The May Revise. You saw the headlines: on Friday, the Governor announced a record $97.5 billion budget surplus, of which $49.2 billion is described as “discretionary” (not committed to specific spending requirements under constitutional mandates, such as education spending under Prop 98). In the same breath, the Governor also announced his plan to dedicate about 94% of that surplus to one-time spending. The CalHR team on Thursday foreshadowed this idea that the record surplus is a non-factor in MOU negotiations since the economy could tank at any time and the surplus could not go to on-gong obligations – like salaries.  

You can check out the May Revise summary regarding General Government and Statewide Issues here. You’ll note a section on Employee Compensation and Collective Bargaining that begins on page 4 of the pdf. While the summary notes planned one-time $217.6 million and ongoing $143 million increases to the employee compensation budget, it specifies that these increases are primarily tied to health benefit premium increases, other post-employment benefits, telework stipends, and Division of Juvenile Justice recruitment and retention differentials. Salary increases are included in the list, but no specifics about the percentage of the total increase reserved for that purpose.

CalHR and the Department of Finance have stated that each 1% increase in Unit 2 salaries would cost the state $8.6 million.

Six units are currently at the table with the Administration – CASE and units 8 (firefighters), 9 (engineers), 10 (scientists), 13 (stationary engineers), and 18 (Psychiatric Technicians).

What comes next? The CASE Bargaining Team continues to eagerly await CalHR’s comprehensive proposal on Unit 2 salaries and benefits. CASE will update you once we receive it.

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