Lambert proposes cost savings with new labor policy

August 24, 2009

Summary

Building flexibility and responsiveness into labor contracts

Story

In response to King County’s budget shortfall, Councilmember Kathy Lambert today proposed policies that prioritize cost savings for labor, which is the largest expense category in King County’s budget.

“Tough economic times call for a reasoned, logical approach to budgeting that focuses on finding savings rather than finding new money,” said Councilmember Lambert. “Since last November’s budget-cutting exercise, I have been working with our labor representatives and other Councilmembers on how to best prioritize our labor policies in order to support our excellent employees and continue to serve our citizens well while reducing labor costs.”

The legislation adds three requirements for King County’s labor bargaining authority, which is vested in the Executive’s Office by the King County Charter, the county’s constitution:

A. Expands the range for the annual cost-of-living adjustment in salaries, by lowering the minimum to zero percent, and maintaining the maximum at the current 6 percent. Labor contracts currently allow a minimum annual cost-of-living adjustment of 2 percent, whether the Consumer Price Index rises by that much or not.

B. Requires new labor contracts to include a reopener clause in the event that county revenues are projected to remain flat or to decline in the next calendar year.

C. Outlines broader labor expenditure reduction strategies, to include:
     1) No cost-of-living adjustment
     2) Increase employee contributions for health care benefits
     3) No step increases
     4) Reductions in wages and salaries
     5) Unpaid furlough days

“When a turbulent economy upsets the revenue stream, the county needs to be able to respond in a matter of months instead of the three-to-six-year terms of most labor contracts,” said Councilmember Lambert. “With more than 80 percent of King County’s labor force represented by unions, it is important to build flexibility and responsiveness into our labor contracts.”

An important objective of this labor policy is to minimize reductions in the level and quality of services to the public in times of declining revenue.

“Updating this labor policy has involved working through policies and legal concerns,” said Councilmember Lambert. “Ultimately, this will help bring balance between labor and management staffing and resources, prevent more layoffs by saving on labor costs, and reduce the need to raise more tax revenue.”


Read the motion