COLAs promised with employees picking up 50% of pension costs
Sacramento County and the International Union of Operating Engineers (Local 39) have reached a tentative agreement for a five-year contract. If approved by the Board of Supervisors on December 10, the agreement will be effective July of 2013.
“We are very pleased to bring this agreement to the Board of Supervisors,” said Robert Bonner, Manager of Labor Relations. “It’s a fair, cost-effective agreement, and puts us ahead of the California Public Employee Reform Act, which requires employees to pick up a greater share of pension contribution beginning 2018.”
In exchange for receiving flexible Cost of Living Adjustments (COLAs) – pay adjustments based on the Consumer Price Index – during the next 5 years, the employees have agreed to increased contributions to pension costs. This increase will occur in gradual 1/3 increments in Fiscal Year 14/15 through Fiscal Year 16/17 until the employees and the County are both paying equal percentages of 9%.
Of the County’s 25 Labor Agreements, Local 39 is one of the larger labor unions, with 1,144 employees. It is comprised of two units:
1. Unit 006 - Operations and Maintenance, refuse collectors for Waste Management & Recycling. (761employees)
2. Unit 017 – Water Quality, employees working in the Sacramento Area Sewer District and Sacramento Regional County Sanitation District. (383 employees)
The net cost to the County over the five-year agreement is modest since the employees will be paying an increased percentage of pension costs. COLAs will be adjusted from 2-5 percent, based on the annually adjusted Consumer Price Index (CPI).
Annual COLA Rates of the Agreement:
FY 13-14 Zero COLA
FY 14-15 2-4 % COLA
FY 15 -16 2-4% COLA
FY 16-17 4% COLA
FY 17-18 2-5% COLA
Read more about the California Pension Reform Act.
Note: The Board of Supervisors approved the contract December 10.