Wayne County Michigan (Detroit + 35 Cities) Imposes Huge Wage Cuts on AFSCME Union Workers

Wayne County Michigan, fed up with two years of failed negotiations on wages and benefits for public union workers, has decided to impose wage cuts on AFSCME union employees.

The Wayne County News Release states "Wayne County will implement a 10% reduction the union refused to take in budget year 2009-2010, as well as the 10% reduction for the current 2010-2011 budget year."

The wording is somewhat ambiguous as to whether the cut is 10% or 20%. The Detroit News reports 10% while the Detroit Free Press reports 20%.

The Detroit News reports 10% pay cut for Wayne Co. union workers

Wayne County Executive Robert Ficano said he's left with no choice but to implement cuts to pay and benefits for union workers effective today.

The American Federation of State County and Municipal Employees will take a 10 percent cut after refusing to do so for nearly two years, Ficano said in a released statement. The sides are at an impasse on several issues, including key economic and benefit issues, he said.

The Detroit Free Press reports Wayne Co. imposes 20% wage cuts on workers

Wayne County Executive Robert Ficano today imposed what amounts to a nearly 20% wage reduction on 1,400 employees in the county’s largest union after two years of failed negotiations.

Employees’ checks will be reduced 10% for not accepting wage cuts for the last budget year and an additional 10% for the 2010-11 budget.

“Our efforts have been tireless, and unfortunately, it’s painfully clear this action must be taken due to the fiscal reality we’re all living in,” Ficano said. “These decisions are neither easy, nor taken lightly. We’ve continued to act in good faith throughout this process, which included rescinding layoffs, hoping proposed concessions would be accepted by the membership. Unfortunately, time and time again, they were not, and we’re left with a disappointing and devastating situation.”

The Correct Approach

1. Establish a budget.
2. Tell the union what the budget is.
3. Refuse to give in on the budget.
4. If negotiations fail, impose wage cuts whether the union likes it or not.
5. To prevent such headaches in the first place, outsource every job possible to the lowest qualified bidder.

The importance of point 5 cannot be over-emphasized. It will help limit the budget and end the haggling with unions on points 1-4. If there is money left over, that money should be returned to the taxpayers via lower property taxes, not wasted on frivolous services.

City, county, state and federal governments have a duty to be fiscally responsible public servants. It's time they behave that way. That means doing everything possible to get taxpayers the most for their money, not the least.

Mayors, city councils, state representatives, and governors, as well as Congress and the president of the United States all need to read the preceding paragraph and act on it.

At the Federal level, Congress needs to abolish Davis Bacon, abolish public union collective bargaining, and abolish all prevailing wages laws. States need to do the same. This in turn will allow cities to do their job, many of which are bankrupt because of regulations imposed by state and federal governments.

Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com
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