Thomas Breen
Michael Gormany and Tom McCarthy testify on the deal.
The city and the local attorneys union have agreed to a new four-year contract that follows a trend in recent city-labor deals by trading modest raises for increased employee healthcare and post-employment benefit contributions.
During Monday night’s Finance Committee meeting in the Aldermanic Chambers on the second floor of City Hall, city Labor Relations Director Tom McCarthy and Acting Budget Director Michael Gormany walked the alders through the proposed new collective bargaining agreement between the city and the New Haven Attorneys Union, Local 1303 – 464 AFSCME, Council 4.
The last Local 1303 – 464 contract expired in June 2015. This new proposed contract extends back from July 1, 2016 through June 30, 2020.
The committee alders decided for procedural reasons not to act on the proposed new contract agreement so that the deal can get a hearing and vote at the Aug. 6 full Board of Alders meeting. According to state law, the latest date on which the Board of Alders can act on the proposed contract is Aug. 8.
In almost the exact same terms as laid out in recent contract agreements with Local 3144’s management and professional employee union and Local 884’s clerical employee union, the new attorneys union contract promises members their first raises in years in exchange for greater employee contributions towards medical and retirement benefits.
The attorneys union is significantly smaller than other city public unions. While Local 3144 has 380 members, the attorneys union only has 11 members, and one of those unionized positions is currently vacant.
According to a letter sent by McCarthy to the full board on June 25, the city and the union both ratified the new agreement on June 25.
The agreement promises across-the-board wage increases of 3.0 percent for 2016 – 2017 (not retroactive), 2.0 percent for 2017 – 2018 (retroactive to July 1, 2017), 2.25 percent for 2018 – 2019, and 2.0 percent for 2019 – 2020.
In return, union members have agreed to contribute 0.75 percent of their base pay towards retiree medical / Other Post-Employment Benefits (OPEB) for July 1, 2018 through June 30, 2019. That payment will increase to 1.25 percent for July 1, 2019 through June 30, 2020.
The proposed contract implements the same Health Incentive Plan (HIP) that Local 3144 and Local 884 now have, which encourages employees to seek preventive medical care and penalizes non-compliant members with $50 monthly fines for individuals and $100 monthly fines for families.
It also bumps up employee cost shares for the four available healthcare plans. The employee premium cost share for the high deductible Lumenos plan will decrease from the current 13 percent rate to 9 percent for Fiscal Year 2018 – 2019 (FY19) and 10 percent for Fiscal Year 2019 – 2020 (FY20). The cost share for the Blue Care POE will increase from 21.5 percent to 23.5 percent in FY19 and 24 percent in FY20; the Century Preferred PPO employee premium cost share will increase from 23 percent to 24 percent in FY19 and 25 percent in FY20; and the Comp Mix employee premium cost share will increase from 17.5 percent to 19.5 percent in FY19 and 20 percent in FY20.
McCarthy told the alders that the city has also added a Health Savings Account (HSA) option for the high deductible Lumenos plan, and will incentivize migration to that plan by funding 65 percent of the deductible effective July 1, 2018 and 50 percent of the deductible effective July 1, 2019 and each year thereafter for the duration of the contract. The deductible for the Lumenos plan is $2,000 for individual members and $4,000 for families.
Hill Alder Dolores Colon asked McCarthy if union members will be required to move to the high deductible plan. McCarthy said they do not have to, but they now have the option to, and will receive some support from the city if they choose to move to that plan.
“The higher deductible will lead to more people paying attention to their healthcare and making better decisions and saving money over the long haul,” McCarthy said. He said the HSA will allow individual union members to invest up to $2,000 each year and families to invest up to $4,000 each year pre-tax in an account where they can save money and then apply it to future medical costs.
McCarthy and Human Resources and Benefits Manager Stephen Librandi said after the meeting that new HSA and high deductible plan encourages employees to put more “skin in the game” by paying a higher deductible up front and therefore, they hope, seeking out regular general practitioner visits rather than emergency room care.
“I think we all understand that healthcare is the cost that is booming in New Haven,” McCarthy told the alders. “It’s booming everywhere.” He said the HSA-high deductible medical plan is the most aggressive step the city is taking in these new union contracts to curb some of those future medical costs.