MADISON — As public sector unions prepare to negotiate their first contracts under the 2011 state law that narrowed the scope of collective bargaining to cost-of-living pay raises, labor experts are reminding workers about how little clout they will have at the bargaining table.
Act 10 eliminates binding arbitration to break impasses, and instead allows government managers to end talks and impose a pay structure.
"Is it the bargaining that we used to have? No. Is it an utter sham? I'd say it's always worthwhile to talk," said Jim Scott, chairman of the Wisconsin Employment Relations Commission. "But in the end, clearly if an impasse is reached, the school board (or other public employer) will be free to implement their last best offer."
Little attention was given to the elimination of arbitration over the last year as hundreds of unions won certification elections giving them the right to bargain for small raises, but not benefits, working conditions or anything else.
But managers and unions have begun talking about it in the wake of a dispute over a rule Gov. Scott Walker approved on March 30 for setting base wages as required under the controversial collective bargaining law. Union negotiations couldn't start until the rule was established.
The Employment Relations Commission approved the rule on a 2-1 vote after Walker rejected an earlier version. Labor attorneys from both the management and union sides told the State Journal that there has been confusion about the rule's implications, with some claiming it means an automatic pay cut for teachers because of the way it deals with Act 10's prohibition on contractual premiums for educational attainment.
Walker said Friday that the rule doesn't require cuts in pay, and Scott has told labor lawyers the same thing. Even the lawyer for the state's teacher union agrees.
Employment Relation Commission general counsel Peter Davis said he disagrees with Scott about the rule's meaning, but the commission and the governor have the final say.
In any case, the competition for good teachers is so keen that probably no school boards will allow teacher pay to decrease, and when necessary the boards will find ways to add supplemental pay beyond the legal limits for contractual wages imposed by Act 10, Davis said.
Walker agreed that despite Act 10's strict limits on negotiated pay raises, employers can add whatever they want. In a meeting with the State Journal editorial board Friday, he used an example in which the contractual cap was $50,000.
"If they want to pay them $70,000, they can do it," Walker said. "There's nothing to stop that."
Davis said unskilled workers are less likely to see such extra pay because there is less competition for their services.
"Things may be tighter for them. I would guess that the local politics could be a little more rough and tumble and taxpayer groups may hold a little more sway," Davis said. "You may hear them say, 'If we were to reduce the pay and, say, lose a truck driver, there would be a hundred people lining up for the job.'"
School districts hit hard
School districts hit hardest by state revenue limits and reduced aid may seek more savings in employee benefit costs, but it won't always be enough, especially in districts where teachers and others are already paying more for health care and pensions, said Barry Forbes, associate executive director of the Wisconsin Association of School Boards.
"They could choose to give no pay increase," Forbes said. "Act 10 gives almost all the bargaining power to the employer. Could schools find themselves in a situation where they had to make a choice between cutting teacher compensation and cutting staff? Definitely there will be some school districts in that situation."
Andrew Phillips, an attorney who advises public administrators, said the future is uncertain.
"I don't think anybody's looking to take the hatchet to anybody's pay," Phillips said. "Employee contributions for pension and insurance have helped, but we will have to look in the long term to find a pay and benefit system that will create lasting savings."
Union attorneys said shrinking budgets present a bleak outlook for public sector workers bargaining under Act 10.
"Walker's budgeting is stripping school districts of the money they need to operate properly and at some point, they'll have to either do serious layoffs or wage cuts," said Katy Lounsbury, who represents municipal and other unions.
Kurt Kobelt, general counsel for the Wisconsin Education Association Council union, said many members are worried, so he sent a memo Wednesday reassuring them that Walker's rule on base wages didn't make pay cuts mandatory. Still, Act 10 has left employees vulnerable unless school boards are "sensible," Kobelt said.
"It's kind of dawning on people how far the act goes and how the bargaining rights under the act are illusionary," Kobelt said. "The sham bargaining created by Act 10 is only window dressing so that Gov. Walker could create the appearance he was not opposed to all forms of collective bargaining."
Scott, the Employment Relations Commission chairman, said employees still have the option to lobby elected officials.
"The employers don't hold all the cards," Scott said.