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PEP Jul/Aug 2009
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Public Employee Press

City postpones 1,000 firings as Municipal Labor Committee accepts health-care savings

The city agreed to postpone the layoffs of 1,000 permanent, noncompetitive and labor-class workers for 90 days under an agreement announced June 2 with the Municipal Labor Committee that will save $400 million in health-care costs over the next two years.

The pact calls for the city to provide a one-time $200 payment to union welfare funds for each worker and retiree. The money should let the DC 37 Health & Security Plan maintain current benefits despite rising costs.

“This deal provides the budgetary relief the city needs with a minimum disruption to our benefits,” said MLC Chair Harry Nespoli, president of the Uniformed Sanitationmen’s Association. “In addition, we achieved two important goals, which are additional money for our welfare funds and the suspension of layoffs of permanent workers for a period of time.”

In negotiations, the MLC rejected Mayor Bloomberg’s demand for a new pension tier that would delay retirement and lengthen the contribution period for future city employees. Bloomberg said he would push for the new plan again next year.

Two major state unions recently agreed to a new pension tier to avert 8,900 layoffs, but the plan’s fate in the stalemated Legislature was in question as PEP went to press.

Bloomberg also dropped his demand that city employees and retirees pay 10 percent of their health-care premiums at a total cost to them of approximately $350 million per year.

The health-care agreement calls for the following changes in the HIP/HMO health plan:

  • a $50 co-payment for hospital emergency room visits, which will be waived if the patient is admitted.

  • a $100 co-pay for hospitalization.

  • a $50 co-payment for treatment at an ambulatory surgery facility.

  • eliminating the preventive dental rider from the basic benefit. (Most members and retirees have union dental coverage.)

In the GHI Senior Care Plan, the agreement establishes a $50 emergency room co-pay for retirees (waived if the patient is admitted).

A series of other changes in the GHI-CBP/Blue Cross plan are largely administrative and will not substantially affect services or costs to members and retirees.

Under the changes, GHI subscribers must use ambulatory surgery facilities and freestanding kidney dialysis facilities that are participating providers in Empire Blue Cross Blue Shield. Subscribers are also required to stay within the EBCBS hospital network.

The deferral of the layoffs will be funded through the Stabilization Fund established by municipal unions in the 1980s as a rainy day fund for benefits.

“The agreement is as good as the MLC could expect under the current circumstances,” said DC 37 Executive Director Lillian Roberts, who is the executive vice chair of the group, which represents 550,000 city workers and retirees.

“It buys time for the workers who face layoffs. In the next three months, we will be looking at whatever we can do to protect their jobs. We have already managed to have some people facing the chopping block move into new positions in the city.”

— Gregory N. Heires



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