“ … (I)t is the fervent hope of the Union that we will not see a repeat of the kinds of proposals this time around that hit the table in 2007.”
If that sounds like a union getting ready for contentious contract talks with management, it is. But in this case, the union is the United Staff Organization of Michigan, and “management” is the Michigan Education Association.
The public tends to hear a great deal about teacher contract negotiations in local public school districts during summer and fall, particularly if a district is placed by MEA on its “critical list.” Usually the district and its teachers or support staff are at odds over how much the district can afford to spend on wages and health insurance.
Yet year-end reports written by people who work for the MEA or its affiliates suggest that when the union is the boss, it also looks for ways to reduce costs, and not always in ways that workers find union-friendly.
The USO is the umbrella organization representing employee groups within the MEA, its third-party insurance administrator (Michigan Education Special Services Association) and its financial services affiliate (MEA Financial Services).
Tom Greene, USO president, declined to be interviewed for this article. However, reports written by union officers inside the MEA, MESSA and MEA Financial Services point out some areas of discontent.
For example:
• At MESSA, management is taking a harder line on employee absenteeism, “suspected abuse” of sick time and what it calls the “culture” of leave time, according to a written report by the president of the Services Staff Association.
In an effort to determine if sick leave also qualifies as time off under the federal Family Medical Leave Act, MESSA asks “for more clinical details than they need, and sends threatening letters to members in order to get this information,” the report said.
MESSA is a third-party insurance administrator that sells Blue Cross Blue Shield insurance packages to Michigan public schools. Two years ago, the association and the MEA fought hard against changes in state law that now require MESSA to release aggregate medical claims histories to school districts — saying it would threaten school employees’ medical privacy.
• At the MEA, management and staff are at odds over travel and expense accounts, according to a report by Chuck Agerstrand, outgoing Professional Staff Association president. Agerstrand also is president of the National Staff Organization, a national umbrella organization for state groups like the USO.
• And at MEA Financial Services, the entity that sells financial products to school employees, workers are "angry and extremely distrustful" after a year in which a new product collapsed and management tried to introduce a new compensation system, according to a written report from the president of the Financial Services Representatives union.
• Finally, the USO apparently has had difficulty getting information from the MEA for the next round of bargaining and considered filing unfair labor practice charges, according to a report by Dave Bowman, head of the USO bargaining committee. The opening paragraph of this article also is from Bowman’s year-end report.
All of the reports were posted at the USO Michigan Web site in advance of its annual meeting in April. USO officers have proposed doubling the budget for grievances and arbitration in the coming year, documents show.
“MESSA as a company is under more pressure than ever before due to legislative attacks, the overall economic downturn and increasing competition for our business,” the Services Staff Association report says. “The MEA membership is changing, in terms of overall numbers, and in what those members want and can afford in a health insurance plan.”
A number of school districts have shifted to lower cost MESSA products in recent years, and some have switched to other insurance providers or administrators altogether.
A growing number of school districts have reported saving money by hiring private firms to provide food, custodial or transportation services, partly because they no longer must purchase health benefits or contribute to retirement pensions for those employees.
MESSA didn’t lose money in 2008, but it didn’t gain as much as in previous years, according to its latest audit. The association added $5.5 million to its “net assets available for benefits” last year, putting that fund at $365 million. In comparison, the previous year MESSA gained $90 million, and the year before that, $129 million. That money consists primarily of insurance premium payments from public school districts, and investment earnings on that income.
At the MEA, the union reported to the federal government that it took in about $132 million and spent $137 million in 2007-2008. Overall, the union had $37 more in liabilities than assets as of August 2008, according to the report, called an LM-2. While income from dues remained steady, at about $66 million, spending was up by about 10 percent.
Education union employees in Michigan are not the only people unhappy with management, according to media and Web reports. Staff employees at the National Education Association headquarters dressed in black, carried signs and conducted a silent, indoor “walk-thru” to protest “takebacks” in the latest NEA contract offer, according to an article at the NEA Staff Organization Web site.
Employees of the California Teachers Association picketed union headquarters in April in contract disputes over an underfunded staff pension plan, according to media reports. Similar disagreements were cited in Oregon.
Michigan Education Report reported in June that public schools will have to chip in more to the Michigan Public School Employees’ Retirement System beginning this fall, to address stock market losses in the billions. Similar losses are taking a toll on private sector pension plans.
According to a report at the National Education Association, many state-level teachers unions are under pressure to fund their employees’ defined-benefit pension plans. The stock market freefall, combined with changes in federal pension law, are forcing the unions to set aside more money to meet mandated funding levels, the report says.
The NEA said 11 state affiliates anticipate pension costs ranging from 19 to 57 percent of payroll in the coming year.
That could trigger some tough bargaining between union employees and management, according to Mort Rhineheart, a pension consultant with the National Staff Organization.
In a video posted at the NSO Web site, he said, “If you’re in a defined benefit plan, you kind of have a battle on your hands with your (union) employer, because they’re footing the bills and the bills that are coming due ... will be very large. All you can do it bargain, and bargain hard.”
The NEA report said that some state-level unions might have to cut programs and services, close offices or increase member dues to pay for their employees’ pensions.
(For further reading, see Paul Kersey's commentary, "The Eternal Struggle," about MEA/USO relations. Kersey is labor policy director of the Mackinac Center for Public Policy, which also publishes Michigan Education Report.)