The Orange County Board of Supervisors will publicly take up their first labor contract next Tuesday as they consider a three-year deal with the Orange County Managers Association.
Supervisors appear to be generally supportive of the deal, arguing that it calls for employees paying their full share of annual pension contributions and keeps overall compensation in check.
“We want to keep total compensation in place because our revenues aren’t increasing,” said Chairman John Moorlach.
Having employees pay more into their pensions has been a central theme of supervisors as they enter labor talks.
Labor leaders, in turn, have been very critical of the fact that supervisors don't pay into their own pensions. Moorlach has defended that disparity, hinting that supervisors will only pay into their own pensions after all employees pay into their own.
The managers' deal is the first of what observers have dubbed the Super Bowl of labor negotiations because the contracts of nearly every major labor group — the managers, the Orange County Attorneys Association, the Orange County Employees Association and the Association of Orange County Deputy Sheriffs — are up this year.
Sources close to negotiations say the attorneys contract is also close but still in the fact-finding arbitration phase with an unfair labor practice complaint filed against the county.
The managers deal — which will cost taxpayers $623,000 during the remainder of the 2012-2013 fiscal year due to performance incentives and a phasing in of payments toward retirement from managers — is set to save $883,000 annually when all the deal points take effect over the next two years of the contract, according to contract documents.
Managers have gone two years without a contract. They voted down a previous version of the contract, supervisors balked on providing bonuses and both sides have fought intensely over having managers pay more toward retirement.
Negotiations reached an impasse on Aug. 24, with the managers requesting the initiation of a fact-finding arbitration a month later. Earlier this month, managers voted to approve the subsequently negotiated offer that will come before supervisors next week.
(The managers association offers its members a history of negotiations here.)
“This has been a long road,” said Moorlach, acknowledging that the two-year delay in negotiations had ultimately lowered net savings for taxpayers.
Moorlach said he favored the deal because it kept total compensation in check and had managers paying toward their pensions.
Supervisor Shawn Nelson took aim at the managers over the delay.
“The managers don’t pay the employee full share, and to drag it on meant they didn’t pay the employee end for up to two years. That’s the best deal in the world,” Nelson said.
Nelson said the managers deal includes a message for the county’s other employee organizations: “All employees will be expected to pay the employee share of the pension,” he said. “It should have been paid a long time ago.”
That’s what the county’s general workforce has been doing since 2004.
This week, the Orange County internal auditor finished examining how employee contributions worked following the highly publicized and controversial pension enhancement of 2004.
We found that OCEA [Orange County Employee Association] members themselves and not the County fully and accurately paid for the cost of the pension enhancements of $101.2 million (2.7% @ age 55 benefit formula) as agreed upon in their 2004 Memorandum of Understanding for Fiscal Years 2008-09, 2009-10, & 2010-11. The $101.2 million paid included additional employee contributions of $67.6 million and health insurance cost savings of $33.6 million.
OCEA General Manager Nick Berardino reacted to the news of the manager’s deal by noting, “the rank-and-file employees have been leading the way since 2004 and have proven themselves to be the true leaders. So it’s a positive step to see the managers paying for their fair share of retirement costs.”