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Friday, Mar 31, 2023

Unions Push Public Pay Out of Scale

There is little question that the compensation, benefits and pensions of public sector employees exceed those of many private sector workers. Whatever the standard, compensation that is commonplace for hundreds of thousands of public sector workers in California is almost unheard of in the private sector. 

Consider, for example, the city of Los Angeles. Its memoranda of understanding with public employee bargaining units are posted on the city’s website. There are more than 80 types of clerical positions. The pay range for these is, on average, $43,600 to $53,200 per year. In general, after five years employment, a secretary will earn $53,200, well above what the private sector generally pays. 

The salaries of clerical workers are commensurate with those of other city workers. Child care associates, golf starters and salaried recreation workers all typically receive more than $40,000 a year to start and all other full-time, salaried city recreation positions receive more than $50,000 a year to start. 

With respect to sick leave, six days a year is common in the private sector, and sick leave often is use it or lose it – it cannot be banked for future years or counted toward retirement. In the public sector, it is entirely different. While different agencies negotiate different sick leave benefits, 12 days of sick leave or more per year is common. The city of Los Angeles provides 17 days of sick leave per year for many employees – 12 days reimbursed at 100 percent of the employee’s daily rate and five days at 75 percent. In addition, sick leave may be accumulated and retained days credited at retirement as additional days worked. 

Concerning pensions, the benefits of public sector employees are unparalleled. Public employees often may retire at 50 to 55 with 75 percent to 90 percent of their final salary, indexed for inflation, for life. Sometimes, particularly in public safety, public workers may not contribute to the pension programs they receive. 

Concerning holidays, six holidays are often standard in the private sector. If a holiday falls on a Saturday or Sunday, it is not necessarily taken on the preceding Friday or following Monday. But many public employees receive 10 holidays per year and one to three floating holidays or personal necessity days. 

These sorts of salaries and benefits do not emerge in a vacuum. Nor is inefficient use of public resources the only negative consequence of current public sector employee organization. Powerful public employee unions create a systemic bias toward larger government and more government activity. Public sector unions are among the most powerful political forces in the nation, particularly at the state and local levels. Many elected officials are strongly backed by public employee unions. 

Public versus private

President Franklin Roosevelt was clear that there is a great distinction between public and private sector unions: “Meticulous attention should be paid to the special relations and obligations of public servants to the public itself and to the government. … The process of collective bargaining, as usually understood, cannot be transplanted into the public service.” George Meany, the first and longtime president of the AFL-CIO, had the same view. 

It is neither liberal nor progressive to support waste in government. The pensions, other benefits and salaries of public sector workers are overwhelming the treasuries of many state and local governments throughout America and the federal government. It should not be the case that two classes of workers are established – government employees and everyone else. Public services should not be sacrificed for public employee compensation. 

The successful path to reform would include eliminating public employee collective bargaining, as several states have done including Virginia and North Carolina. The legislation passed in Virginia under former Democratic Gov. Douglas Wilder prevents the state, counties, cities, school districts and other government agencies from recognizing any employee association as a bargaining agent for government workers and from bargaining with them. 

To eliminate public employee collective bargaining does not take away the ability of government workers to form voluntary organizations to lobby on a variety of issues, including compensation. But it would not give these organizations the ability to represent government workers in the bargaining process. 

The rise of public sector unions has coincided with a vast expansion of government compensation, and wasteful and overly expensive compensation for public employees. While it is essential that many aspects of public employee compensation, especially pensions, are reformed in the coming years, equally important will be to reform the system of public sector employee organization itself. To eliminate public sector collective bargaining would be a significant step in the right direction. 

Lanny Ebenstein is a visiting professor in the economics department at UC Santa Barbara and is president of the California Center for Public Policy, a Santa Barbara research institute focused on public sector employment issues. He also is the author of many books on political science and economics.

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