Contract With Town Hall Employees Heads Back to RTM

A proposed contract between the town and a union representing Town Hall employees is heading back to the Representative Town Meeting with a higher cumulative salary increase but a requirement that new employees participate in a "401(a) type pension plan with no eligibility or vesting rights in the Town's existing Pension System."

The RTM had rejected a proposed contract between the town and 84 employees in the union last summer - along with a proposed contract between the town and a union representing firefighters - because First Selectman Ken Flatto's administration, according to RTM leaders, hadn't presented them with a financial analysis that compared having employees in a 401K instead of the town's pension plan. Since then, Hooker & Holcombe, the town's actuary, released a report saying annual required contributions to the town's pension plans for town employees and for police officers and firefighters were projected to rise to $17.38 million in the 2016-17 fiscal year.

Contracts between the town and the seven unions representing town employees have all expired. The contract with the Town Hall employees expired June 30, 2010.

In addition to the change to a 401(a) type pension plan for new employees, the new proposed contract between the town and Town Hall employees also calls for annual raises of:

* 0 percent from July 1, 2010 to Dec. 31, 2010.

* 1.5 percent from Jan. 1, 2011 to June 30, 2011.

* 2.5 percent from July 1, 2011 to Dec. 31, 2011.

* 0.5 percent from Jan. 1, 2012 to June 30, 2012.

* 3.5 percent from July 1, 2012 to June 30, 2013.

Annual raises in the existing, expired contract had been 3 percent in each of the four fiscal years covered by the contract, which ran from July 1, 2006 to June 30, 2010. Annual raises in the contract rejected by the RTM last July had been 0 percent from July 1, 2010 to Dec. 31, 2010; 1.5 percent from Jan. 1, 2011 to July 31, 2011; 2.5 percent from Aug. 1, 2011 to June 30, 2012; and 3.25 percent from July 1, 2012 to June 30, 2013.

The new proposed contract also calls for the employees to take a furlough day and what is referred to as "one paid furlough day" and calls for overtime, at a rate of time and-a-half, to be for hours worked in excess of 40 hours a week, instead of 35 hours a week. It also "deletes permanently" allowing the employees one day's pay for every six months with no sick time and calls for existing employees, effective July 1, 2011, to contribute 10 percent toward their health insurance premiums with no cap (12 percent for new hires.) The percentages rise on July 1, 2012 to 11 percent (13 percent for new hires), again with no cap.

Employees hired after April 1, 2011 have to contribute at least 4 percent to the 401(a) type pension plan, though they can contribute up to the maximum allowed by law. The town would match the employee's contribution up to a maximum of 5 percent, and the town's contribution wouldn't vest until the employee had been continuously employed for five years.

The town also has to provide longterm disability benefits for the "permanent and total disability of employees" hired after April 1, 2011 at a rate of 50 percent of salary, and that benefit would be provided through insurance.

The cost of the proposed contract is estimated at $39,084 from July 1, 2010 to June 30, 2011; a savings of $16,496 from July 1, 2011 to June 30, 2012, and a cost of $97,235 from July 1, 2012 to June 30, 2013. Employees in the union representing Town Hall employees make an average of $50,000 a year, according to town officials' statements last summer.

The cost of the new defined contribution plan and the longterm disability benefits is projected by Hooker & Holcombe to remain flat at 7.5 percent of payroll for an employee who's hired at age 40 and who retires at age 62. The cost of the current defined benefits plan is projected to rise from 8.7 percent of payroll at age 41 to 22.9 percent at age 62 and includes all of the benefits provided under the plan, including death, disability and retirement benefits. The projections don't reflect the impact of employee turnover before retirement.

Changes to medical co-pays weren't immediately available, but they are projected to save $36,461 in the next fiscal year and $40,107 in the 2012-13 fiscal year. Employees' increased contributions to health care premiums are projected to save $46,956 in the next fiscal year and $52,121 in the 2012-13 fiscal year, and the unpaid furlough day and "paid furlough day" in the next fiscal year are projected to save $17,714.

The proposed three-year contract, which runs from July 1, 2010 to June 30, 2013, is scheduled for review and a vote by the RTM during a meeting that begins at 8 p.m. April 25 in Osborn Hill School.