Tagged: state employees

Thousands of state employees are applauding a judge’s ruling that they shouldn't be forced to pay for their pension benefits.

An Ingham County Circuit Court judge said today that a rule requiring state employees cough up four-percent of their salaries to keep their pensions is unconstitutional.

She said it’s effectively a pay cut, something only the Michigan Civil Service Commission has the authority to enact.

Ray Holman is with UAW Local 6000, the largest state employee union in Michigan.

LANSING, Mich. (AP) - Nearly 50,000 state workers are getting refunds on the 3 percent they've been paying for a year toward retiree health care costs.

State budget director John Nixon estimates a worker making $50,000 a year will get back about $1,500.

Gov. Rick Snyder signed bills last month agreeing to refund the money after courts ruled the fee unconstitutional. The money was being returned Thursday.

Workers can choose to receive the refunds in their paychecks or as a deposit into their 401(k) or 457 retirement accounts.

A similar 3 percent contribution being paid by teachers toward their retiree health care costs is not being refunded.

State employee unions had contested the fee, saying only the Civil Service Commission could impose it. Unionized and nonunionized workers will receive the refund.

Governor Rick Snyder’s administration has reached a deal with unions representing 35,000 state employees on a two-year contract beginning next year. Last week, both sides declared their negotiations were deadlocked.

The agreement averts arbitration hearings that were to begin Monday. Details on compensation, benefits and work rules are not being made public pending union ratification votes. But the tentative agreement does include some employee concessions, while the Snyder administration has agreed to examine manager-to-staff ratios and the cost of outside service contracts for possible ways to save money.

The contract will take effect in October of 2012.

The state unilaterally resolved a deadlock to come up with $265 million in savings in the current fiscal year by imposing four unpaid furlough days, and not filling 367 vacancies. About 2,000 corrections employees will also lose their jobs as the state closes a prison in Detroit.

Update 3:12 p.m.

Governor Rick Snyder has decided not to send out 30-day layoff notices to thousands of state workers while contract bargaining continues.

Allowing today’s deadline to pass means no workers can be laid off with the start of the state’s new fiscal year on October 1.

The governor’s spokeswoman says he wants to send a signal that he’s confident a deal can be reached without resorting to layoffs and other temporary solutions to keep the state budget balanced.

Ray Holman is with UAW Local 6000, the largest state employee union. He says the decision not to send layoff notices was the right one.

 "We agree with Governor Snyder that we need to make structural changes and what we need to do is look at the private contracts and then also invest in frontline staff, invest in the foot soldiers - the people actually doing the work."

Holman says that means managers should be first in line to lose their jobs to budget cuts.

The Snyder administration is trying to convince state employees to pick up a bigger share of their health and retirement costs.

The administration is looking for a total of $265 million dollars in employee savings.

2:58 p.m.

Governor Rick Snyder's administration will not send layoff notices to state employees as contract talks continue.

Snyder's spokeswoman says he wants to send a signal to state employees that he believes a deal can be struck before the state's new fiscal year begins on October 1.

State contracts require 30-day notice before layoffs can occur.

The Michigan Court of Appeals says the Legislature violated the state constitution by illegally taking money from state employee paychecks to cover retirement health care costs.

State employees are in line to get back $60 million dollars that was withheld from their paychecks if this decision stands.

The court of appeals says then-Governor Jennifer Granholm and the Legislature could not take three percent of state employee salaries for retirement costs after lawmakers failed to block three percent pay raises.

The pay raises were approved by the independent state Civil Service Commission, and could only be reversed by super-majorities in the House and Senate.

The appeals court said that was just another way to take away the pay raise, and violated the process set up by the state constitution.

Governor Rick Snyder says the money is needed to help cover a shortfall in the state employee retirement fund. He could ask the state attorney general to appeal the decision to the Michigan Supreme Court.

*Correction - an earlier version of this story incorrectly stated that the current Michigan legislature and Governor Snyder "adopted the plan earlier this year that requires state employees contribute 3 percent of their paychecks toward their retirement health care costs."

The plan was adopted under a previous legislature and then-Governor Granholm.

The headline has been changed as well. (previous headline "Court rules Michigan legislature and Gov. illegally quashed pay raise").

We regret the error.