 In a 5-0 decision, the Illinois Labor Relations Board determined on Nov. 15 that
the state and the American Federation of State, County and Municipal employees
are at an impasse in negotiations for a new contract for state employees.In
light of the state’s fiscal crisis, Gov. Bruce Rauner has sought contract
provisions that would benefit state workers and state taxpayers alike, but
AFSCME has repeatedly rejected the state’s proposals. For example, the state
proposed a temporary four-year salary freeze, but also proposed bonuses for
state workers based on hard work and performance. AFSCME also rejected the
state’s proposal that overtime start at the market norm of 40 hours, instead
demanding that overtime pay apply after just 37.5 hours in a week.
The board’s decision means the governor will be able to implement his last and
best offer to AFSCME. AFSCME, in turn, can strike. AFSCME can also appeal the
board’s decision to a state appellate court.
AFSCME already receives top-notch pay and benefits
 Illinois state workers already are the highest-paid state workers in the nation
when adjusted for cost of living. When the most recent AFSCME contract expired
in 2015, the median AFSCME salary was $63,660 – compared with just under $32,000
for an Illinois worker in the private sector. In fact, according to the U.S.
Census Bureau, the median income for an individual AFSCME worker is higher than
the median income for an entire Illinois household in the private sector (just
under $58,000 in 2014).
But on top of that, AFSCME workers get platinum-level health insurance – a level
of coverage not even available to Illinoisans on the state’s insurance exchange,
let alone at the rock-bottom price state employees pay. Taxpayers subsidize a
whopping 77 percent of the average AFSCME worker’s health care, which costs
taxpayers $14,880 a year per worker.
Most AFSCME employees also receive free health insurance at retirement, simply
by working 20 or more years. This benefit alone costs taxpayers $200,000 to
$500,000 per employee.
In addition, state retirees on average receive $1.6 million in pension benefits,
in addition to Social
But that isn’t enough for AFSCME leadership, which is making contract demands
the Rauner administration estimated would cost the state an additional $3
billion in pay and benefits for state workers. Those demands include wage
increases of 11.5 to 29 percent by 2019, continued platinum-level health
insurance at little cost to workers, and a workweek with overtime for workers
after just 37.5 hours. In a letter to state employees, Rauner explained that the
wage-increase demands alone would cost the state nearly $1 billion.
Rauner’s proposed AFSCME contract
 Rauner, on the other hand, is trying to bring union costs in line with what
Illinoisans can afford, while avoiding widespread state worker layoffs. To ease the financial burden on taxpayers, Rauner’s proposal to
the union includes a temporary four-year wage freeze on AFSCME
salaries. At least 19 other unions have already ratified contracts
with the state that include provisions similar to those offered to
AFSCME. Both the Teamsters and the Illinois Federation of Teachers
have agreed to a temporary four-year wage freeze.
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 And instead of continuing to provide platinum-level health insurance
at bronze-level prices, the governor is asking AFSCME workers to pay
40 percent of their health care premiums – up from the 23 percent
they pay now. This means state taxpayers will continue subsidizing
60 percent of an AFSCME employee’s health care, at $11,600 per
worker annually – still a significant amount by any standard.
The governor also has proposed overtime provisions that more
closely reflect what exists in the private sector. Currently, many
state workers earn overtime after working just 37.5 hours in a
workweek. Rauner’s proposal would require 40-hour workweeks for
state workers before overtime kicks in. The difference between a
37.5-hour workweek and a 40-hour workweek would save the state $63
million dollars over the term of the contract.
The proposal also adjusts overtime pay for holidays. Currently,
state employees earn double time if they work on any one of the
following holidays or their observed days: New Year’s Day, Martin
Luther King Jr. Day, Lincoln’s Birthday, Presidents Day, Memorial
Day, Independence Day, Columbus Day, Veterans Day, the Friday after
Thanksgiving and Election Day.
The expired contract also included three “super holidays”: Labor
Day, Thanksgiving Day and Christmas Day. Employees working on super
holidays earn double-and-one-half times their normal rate of pay.
The governor’s proposal would modify holiday overtime, providing
that AFSCME employees would receive overtime pay at the rate of time
and one-half (rather than double time) for regular holidays, and
double time for super holidays. This adjustment to holiday pay would
save taxpayers $48 million over the life of the contract.
The governor’s proposal also includes many provisions that would
benefit AFSCME workers. For example, Rauner’s offer maintains
workers’ current salary levels.
In addition, the governor has proposed over $200 million in
additional compensation in the form of bonuses when employees meet
simple, objective standards – such as not having unexcused absences.
Also known as merit pay, this performance-based incentive would
reward good employees with bonuses above and beyond normal salary.
And many other lavish perks – such as lax disciplinary rules
allowing workers up to 10 unauthorized absences without
repercussions – would continue under Rauner’s last offer.
While the board’s decision brings the parties one step closer to the
implementation of a contract for state workers, things are still far
from over. With AFSCME expected to appeal the decision, it will be
early 2017 – at the earliest – before resolution of the stalemate
between AFSCME and the state.
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