By: Ted Dabrowski and John Klingner

It looks as if AFSCME will win yet another battle in its long-standing contract fight with the state. The state and AFSCME haven’t had a labor contract in place since the last one expired in June 2015.

Since then, AFSCME salaries have been frozen, but now the courts say that the state must honor any step increases – built-in automatic increases over and above normal pay raises – that were in place in the previous contract. The courts have now sent the pay dispute back to the Illinois Labor Relations Board (ILRB) for a remedy.

Ironically, that means many AFSCME workers could see pay increases even if their union won’t agree to a contract. And if they get their way, it will be expensive. The step increases alone will cost the state – and taxpayers – more than $400 million. That’s the cost to make up for the lost step increases since July 2015 through 2019, the soonest Illinoisans might expect a new state contract with AFSCME. (It’s unlikely the union will reach any sort of deal with Gov. Bruce Rauner before the general election.)

According to AFSCME, roughly 40 percent of its 35,000 members under the governor’s purview are eligible for step increases. On average, the automatic step increases are 3.8 percent a year.

The AFSCME contract runs counter to what the state has been able to negotiate with 19 other labor unions in Illinois. The other, smaller unions agreed to salary freezes and other concessions in light of Illinois’ financial difficulties.

Not AFSCME. The union’s original demands included worker salary raises ranging from 11.5 to 29 percent, a 37.5-hour workweek, five weeks of vacation and enhanced health care coverage.

Their additional demands are extreme considering what they’ve gotten in the past. State AFSCME worker salaries grew more than 40 percent between 2005 and 2015. Meanwhile, the earnings of ordinary Illinoisans grew only 11 percent, half the rate of inflation.

In fact, Illinois state workers are the 2nd-highest paid in the nation after you adjust for cost-of-living.

Taxpayers also pick up most of state workers’ health care costs. And in retirement, career state workers get free health insurance and will average over $1.6 million in lifetime pension benefits – on top of Social Security.

In all, our previous work shows the average state worker receives nearly $110,000 in total compensation.

Illinois taxpayers, struggling under the highest property taxes in the nation and a recent income tax hike, can’t afford these type of benefits for AFSCME workers.

Illinois’ crisis won’t end until AFSCME salaries, healthcare and retirement benefits are reduced to a level taxpayers can afford.

A salary freeze, which was the de facto situation for the past three years, should be the least of AFSCME’s concessions.

19 Comments
Newest
Oldest Most Voted
Inline Feedbacks
View all comments
Jason
2 years ago

Have all the pensions you deserve, but why can’t we tax them ? @ age 55 a 50% tax,full pension @ age 67 if you get two state pensions the higher one can be taxed at 50% if you and your spouse get state pensions you get taxed on both 25%. I think there is no law saying after you get your pension payment it can not get taxed.

nixit
2 years ago
Reply to  Jason

If you tax public sector pensions, you must tax all retirement income. BUT the state could always exempt social security, as many states do. That, I’m sure, would get the public sector retirees all riled up.

John Bond
2 years ago

Having fun with your constant state employee hatemongering? Feel better about yourself? Here’s some learing for you sir. The contract that expired is still in effect until such time a new one is negotiated or imposed. So, that means the contractual provisions – all of them – have to be honored. You can stomp your feet and hold your breath all you want and blame all the world’s woes on state employees but that’s just pathetic. And it’s nice to see you’re all giddy about taking money away from people, whether it be through salaries or benefits. Mr. Dabroski, the… Read more »

Adam
2 years ago
Reply to  John Bond

Your pensions will not be paid as is because math and reality say so. Math and reality always win. Taxes can only go up so much for your corrupt pensions created for votes. The good of the state will win out. You have a lot to worry about. Me, if my company moves, then I am out of this dump of a state. Your pensions will run out of funds and then have be lowered. The end.

Rauner’s Daddy
2 years ago
Reply to  Adam

Adam, 250 years of contract law and a federal constitution say otherwise. There is nothing you can do about it.

Adam
2 years ago

Nothing I can do? WRONG. I will move when my company does due to the taxes being too high, and of course so will many others. Law does not win over reality and math. Do you think taxes can and will go up forever for your unsustainable pensions? Do you think families barely getting by with kids are going to live in the poor house and still work in this dumpster fire of a state just for your pensions? If so, then you are at the least a total fool. Enjoy the mathematical reality coming your way pal.

Rauner’s Daddy
2 years ago
Reply to  Adam

It appears you don’t comprehend math very well. 1) families barely getting by with kids don’t pay jack in taxes – so it doesn’t make any difference to them. 2) IL has. A $700B GDP. Top 20 in the world. Bigger than most countries. There is plenty of money in this state. 3) The unfounded pension amount is how much would be needed IF EVERYONE retired right now. Not gonna happen. 4) There is plenty of money to be made in this state, businesses aren’t going anywhere. 5) You are a brainwashed fear-mongering idiot that ca’t step back and look… Read more »

Admin
2 years ago

Families barely getting by are paying dearly for pensions through sales taxes and property taxes (even if they are renting because much of the tax is passed through). The unfunded liability is not based on everybody retiring now. That’s a common myth. It’s the difference between how much we project will have to be paid out and how much we have in assets, adjusted to reflect expected earnings on those assets, all respecting work already performed. The tax base is already shrinking because of the exodus. If you think businesses aren’t going anywhere, start with a visit to Southeastern Wisconsin… Read more »

nixit
2 years ago

I bet those “families barely getting by with kids” who “don’t pay jack in taxes” will still be counted in JB’s progressive tax plan as those that’ll receive a tax cut.

Adam
2 years ago

What a pathetic response Rauner’s “I’m too afraid to use my real name” Daddy. Mark said everything I was going to. Wrong in every single way you are. The constitution will lose to mathematical reality, and then the provision will mean zero for your bankrupt pension. Enjoy your pension defaulting and then being lowered significantly. I will more than likely be enjoying your misery in another state by then.

Mark M
2 years ago

Rauner’s Daddy – families barely getting by with kids don’t pay jack in taxes! Precisely!! It strikes me that only the top five percent of income earners – the truly productive – can make a debt in the enormous debt Illinois has accrued and will continue to accrue. And these top 5 percent are most migratory of all income earners. I confess to not having done the detailed math, but even with a highly progressive income tax, fixing this mess on the backs of 250 thousand income earners who have more agency over their lives than most seems incredibly unrealistic.… Read more »

Paul
2 years ago
Reply to  Mark M

It is fairly easy for the high income taxpayers to move. Much harder if you are the typical cash strapped middle class Illinois taxpayer. And who wants to buy your property if you are leaving because the taxes are too high?

Mark M
2 years ago
Reply to  Paul

A bit of off topic – upon leaving the Newark NJ airport this last Saturday morning, I was greeted by a billboard adjacent to I-78 proclaiming “Come to Indiana, a Great Place to Do Business!”. High tax, big government jurisdictions like New Jersey and Illinois make it easy for governments such as Indiana’s to cherry pick businesses as it is tempting for such businesses to avoid the burdens of operating in kleptocratic blue states. And of course, when the businesses leave, so do the jobs and people. Don’t think for a moment Indiana is spending money on some of the… Read more »

Adam
2 years ago
Reply to  Paul

As I stated before, if taxes get too high then I am certain the company I work for will move out of state. When that happens I will simply move with it. I already own my home, so I will just auction it off if I have to. I will gladly take whatever I can get and watch the pensions collapse from somewhere else.

Paul
2 years ago

When the contract is expired it is the time the union can be replaced.

2 years ago
Reply to  John Bond

John Bond, you sound hateful and greedy, when you should be grateful. Even the Illinois Constitution cannot over-rule natural law. When the money is gone, and the stores have closed and all of Illinois resembles Detroit at its worse, then what will you do?

Paul
2 years ago
Reply to  JanS

They will be happy to get $0.30 on the dollar and a frozen payout.

With automatic raises, why even bargain for a new contract?

nixit
2 years ago
Reply to  Paul

I was wondering the same thing. The only thing lost was COLA increases, but the past 3 years inflation averaged a bit over 1%, so COLA wasn’t really necessary. The step increases easily beat inflation. From a salary perspective, AFSCME really made out like a bandit here by doing nothing.

2 years ago
Reply to  John Bond

“Mr. Dabroski, the pensions HAVE TO BE PAID. The Supreme Court has said it. “
LOL, well, if the Supreme Court “said it”, then it MUST BE TRUE!!!! Hahahaha… John, are you a comedian as well as a public employee? The dorks in Detroit, Stockton and Vallejo said the exact same thing! So tell me, how did that work out for THEM John?