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NYC LABOR AGREEMENTS
New York City’s plan to get retirees on Medicare Advantage is stalling labor contract negotiations.
By Bob Hennelly
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THE THORNY ISSUE of how New York City provides its nearly 250,000 retired civil servants with health care is shaping up to be a major impediment for contract negotiations getting underway with dozens of unions that represent the city’s roughly 280,000 employees.
“I think I was one of the first unions to reach out to City Hall to try and start negotiations for the next round of bargaining to get detectives their well-deserved increase in salary but the Medicare Advantage situation is holding everything up up because it could have a devastating effect on both our active and retired members,” Paul DiGiacomo, president of the Detectives’ Endowment Association, told City & State. “My strategic analysis is if I settle a contract now and get 3%, 4%, 5% over five years, whatever it may be, and then the health care costs come back and they say we have to contribute 3%, 4% or 5%, where’s the raise?”
The union’s contract expired in June, and the upcoming talks for city unions will play out under strained conditions. And with a booming private sector job market, New York City’s public agencies just don’t seem as attractive as they once did when jobs were harder to get.
According to an analysis by New York City Comptroller Brad Lander’s office, Mayor Eric Adams did not set aside a lot of money for raises in the upcoming contract talks.
“In addition, looming on the horizon is the upcoming round of collective bargaining, which could pose a significant additional risk to the budget,” the comptroller wrote. “The city set aside resources in the labor reserve assuming 0.5% increases in the first two years of the contracts and 1% increase in each year thereafter, which is likely to be insufficient. Each additional percentage point in wage increases would cost $450 million per year.”
DiGiacomo noted that the contract limbo was playing out at a time when more of his members were opting to retire, a trend that’s applicable across the NYPD. The pandemic and a perceived lack of support, DiGiacomo said, had affected mo-
ANDREW LICHTENSTEIN/CORBIS/GETTY IMAGES New York City Mayor Eric Adams has a bunch of expired union contracts that need to be resolved, including with NYPD detectives.
rale. “There is no rank that stands out more than the rank of detective during the COVID virus when we lost eight NYPD detectives,” DiGiacomo said.
“Prior to the 2001 9/11 attack, we had 7,400 detectives. Right now, we are at 5,300, and we are doing a lot more investigations in addition to counterterrorism. The rank of detective is spread very thin with the number of violent crimes and shootings that need to be investigated,” he said. “There are some days when there are more defendants in the precinct cell than there are detectives working.”
UP IN THE AIR
Last year’s retiree revolt against thenNew York City Mayor Bill de Blasio’s administration and the Municipal Labor Committee’s proposal to shift retirees to a privatized Medicare Advantage program resulted in an ongoing court case and a decision by the two health insurance companies to withdraw. One key issue was a requirement that city retirees who opted out of the new offering would have to pay
a $191 monthly premium for their old plan.
While City Hall and the unions said the Retiree Health Alliance, which was going to be run by Anthem and Empire Blue Cross Blue Shield, would produce $600 million in savings with no degradation in coverage, the New York City Organization of Public Service Retirees said the change threatened retirees’ continuity of care, would cost more and would cover less.
Last month, when Anthem and Empire walked away, Adams spokesperson Jonah Allon said the city and the Municipal Labor Committee “continue to believe that a customized Medicare Advantage Plan (was the) best opportunity” for retirees and the city’s taxpayers, but there was been no resolution of the controversy that has pitted some retirees against union leadership.
Further clouding the city’s public sector labor contract picture was a request for information put out by the city and the Municipal Labor Committee in June looking for a new benefits administrator for its active duty workforce and dependents.
“Our joint goal of the redesign is to reduce the cost of delivering health care by at least 10% while continuing to provide efficient, high-quality health care to all city employees and pre-Medicare retirees without significant increases in member outof-pocket cost,” according to the request. “This RFI requests information from interested, qualified entities to determine whether creative ideas and better delivery strategy can be achieved.”
Traditionally, New York City civil servants have successfully resisted having health care premiums imposed on them, even as other public employees, including state workers, have had to pony up. City union leaders insisted that they were not getting a free ride because they had made wage concessions for a generation to hold on to those benefits.
“We would probably be making 33% more in wages if we didn’t have to make the concessions to hold on to the health care for all these years,” said Joe Puleo, president of Local 983, which represents thousands of blue-collar workers. “A lot of our members don’t realize how it works, how these benefits are funded. They think the city just voluntarily picks up the tab.”
Citizens Budget Commission, a nonprofit fiscal watchdog, has advocated that city workers should pay some portion of their health insurance premium, a non-starter for city unions.
“This (is) always quite a challenge because the city has a long-term structural problem in its budget and any money that we spend in raises for workers that’s certainly deserved by many is not in the current budget that has out-year gaps,” said Andrew Rein, the group’s president. “We really need to change the nature of the labor-management compact because city employment has been structured to guarantee job security, not necessarily to be flexible, innovative and nimble.”
PANDEMIC PROBLEMS
Dalvanie Powell, president of the United Probation Officers Association, told City & State that the inability to start contract talks due to the unresolved Medicare Advantage controversy was problematic.
“Our contract expired back in November of 2020, during the height of the pandemic,” Powell said. “I have been losing members since 2019 when we had 849, down to now just 671 in just the last three years. They are frustrated. The young people are leaving after just three, four and five years for other agencies because our salaries that start at just $45,934 are extremely low.”
Powell noted that her members are required to have a four-year college degree, are armed and receive firearms and self-defense training as peace officers, yet are considered civilians. The union, which is mostly comprised of women of color, has a pending Equal Employment Opportunity Commission case alleging that the existing pay disparity with the NYPD amounts to race- and gender-based discrimination. The city’s FDNY emergency medical services unions have a similar case pending.
In an interview with City & State, Harry Nespoli, chair of the Municipal Labor
District Council 37 members gathered for a June 15 contract rally that emphasized better pay and the important role they play at work.
– Harry Nespoli, Uniformed Sanitationmen’s Association president, on how the city should proceed with negotiations
Committee, the umbrella coalition of all of the city’s public unions, said it was his understanding that the city Office of Labor Relations was holding off on contract negotiations pending a resolution of the Medicare Advantage controversy.
“This mayor did kind of inherit a broken city right now and he has been trying to put it back together, and all the unions are anxious to get back in there to negotiate,” Nespoli said. “These city workers have been through hell for these 2 1/2 years during COVID and there are still unions out there that did not get their contract settled in the last round yet because of the pandemic. I don’t see why (Adams) doesn’t move forward with those unions that didn’t settle in the last round.”
Nespoli, who is also president of the Uniformed Sanitationmen’s Association, believes that City Hall and the unions can work on a two-track strategy. “You know how long a contract takes? So, start talking to the unions now so that once this Medicare Advantage is resolved, one way or the other, we can get these workers their money,” he said. “I mean people like my members were all ordered in when the whole city was shut down. You have to compensate them. You see what inflation is doing now in the grocery store.”
Michael Mulgrew, president of the United Federation of Teachers, spoke in a wide-ranging interview about the UFT contract expiring in the middle of September and he expressed confidence that the health care coverage issue would be resolved because of the city’s strong financial situation.
“The workers of New York City are essential to it bouncing back from COVID,” he said. “They performed admirably throughout the pandemic and now the city does have record reserves. We are going to wait to see where things go. We see that tourism is back and is alive and well. But if New York City is going to bounce back big time and thrive, then we need to make sure we’re giving the workers the raises that they need to live here.”
The UFT, which is unusual in that it permits retirees to vote and participate in the union, has started its internal committee process that relies on hundreds of members to weigh in on future contract priorities.
“Universal child care is a big issue,” Mulgrew said. “My union is 80% female – and it shouldn’t be this way – but the women are always the ones taking care of the family.”
Organization of Staff Analysts Chair Bob Croghan, whose organization represents several thousand staff analysts in city agencies as well as in NYC Health + Hospitals, said wages were not the only thing on his members’ minds.
“It appears to be an odd period because people have been battered by the tremendous changes brought on by COVID and the pandemic that’s been going on forever, so that everything is really discombobulated, making it really hard to know what comes next, not just here in the city, but nationally,” Croghan said. “For that reason, I don’t think I am getting battered yet by my members about the high inflation and that there’s at least a possibility we don’t see such a high raise. I think I am waiting for the other shoe to drop.”
City Hall was asked about the concerns raised by several union leaders that contract negotiations were contingent on the resolution of the Medicare Advantage issue. “The city looks forward to bargaining with any unions who are willing to come to the bargaining table for contracts that are in the best interest of city workers and taxpayers,” Allon said.
Henry Garrido, the executive director of District Council 37, representing over 100,000 city workers, said in a statement, “City workers have sacrificed so much since the pandemic began, and they continue to put their lives on the line every day for New Yorkers while dealing with the pressure of economic uncertainty at home. As the cost of living continues to rise, our workers deserve a fair and reasonable wage. We look forward to negotiating with the Adams administration to achieve the best possible contract for our members.” ■ Bob Hennelly is a reporter with The Chief.
By Max Parrott Baristas unite!
More than 200 stores have been unionized in the past year.
After a legal victory in Tennessee, Starbucks workers in Western New York are watching a National Labor Relations Board case that could boost their drive to unionize.
THE FUTURE OF the U.S. labor movement is set to play out in a Western New York courtroom.
Union advocates alleged that seven Western New York Starbucks baristas were fired in retaliation for organizing. They also alleged union-busting practices across 18 Starbucks locations, including surveillance and threats. In June, the National Labor Relations Board filed a petition for a federal injunction that would reinstate fired workers and send a message that the union is here to stay.
A successful injunction would make Buffalo the second local Starbucks union campaign to receive a federal court victory. A federal judge in Tennessee just became the first to order Starbucks to reinstate a group of fired workers at a Memphis location in mid-August. The company was also ordered to stop meddling in other ways, such as by discarding pro-union flyers.
That landmark win for the union in Tennessee set up the NLRB’s Buffalo case currently making its way through courts. But the Buffalo case will test a much more extensive set of allegations – and it’s being heard by a more conservative judge.
In reaction to the wave of Starbucks unionization, NLRB General Counsel Jennifer Abruzzo has pushed for regional offices to “aggressively seek” injunctions in cases like those against Starbucks, where an employer is being accused of undermining active union campaigns. In the normal course of an NLRB investigation, the agency can take anywhere from one to two years to reach a final decision on a labor case – especially one as expansive as the one against Starbucks in the Buffalo region. A federal injunction would fasttrack enforcement within the span of several months. (Separately, New York City is also getting involved in the cause, suing Starbucks for allegedly firing a union organizer in Queens.)
REPLICATING TENNESSEE’S SUCCESS IN NEW YORK
The Buffalo district court case will be the third NLRB attempt to score an injunction against Starbucks. The Arizona branch of the agency lost its first bid for an injunction before the victory in Memphis. The Tennessee injunction was a major boost, according to Michael Dolce, a partner at the law firm representing the Buffalo workers.
“The thorough and well-reasoned order from the Western District of Tennessee should be a sign of things to come. We expect district courts across the country who are examining similar
Protesters rallied outside former Starbucks CEO Howard Schultz’s New York City apartment
fact patterns to follow in its footsteps, including up in Buffalo,” Dolce said.
The union said the Memphis decision validated reports that Starbucks stores across the country have intimidated and in multiple cases terminated workers involved in the organizing campaign.
“Starbucks has repeatedly denied firing the Memphis workers for their organizing activity, and this decision … set the record straight. We will continue holding Starbucks accountable for their vicious and unethical union-busting campaign,” the Starbucks Workers Union wrote in a statement.
In response, Starbucks’ corporate leadership continued to maintain that the workers in Memphis were let go for violating company policies. In Buffalo, the company has thus far launched a similar defense.
According to a statement on the Starbucks website, the company plans to appeal the Tennessee decision and request a stay of the injunction, potentially delaying the rehiring of fired workers.
The Memphis decision upheld a broad cease-and-desist order against labor violations at all Starbucks stores. In the Memphis case, the labor violations included interfering with a sit-in campaign, a retaliatory writeup and the removal of fliers from the community bulletin board, but the main consideration involved Starbucks firing the majority of one store’s bargaining unit after several workers invited a news crew into the store after hours to cover the nascent union drive.
In Buffalo, the complaint issued by the NLRB was much more extensive. It included 18 stores and hundreds of impacted workers. Like in Memphis, the NLRB is seeking a cease-and-desist order as part of its injunction, but the range of labor violations involved in the NLRB’s New York complaint included surveillance, interrogation, store closures, threats and promise of benefits to nonunionized stores, among other offenses.
Potential enforcement of cease-and-desist orders raises new legal challenges for Starbucks that a court order in Buffalo would expand on. If the injunction is ordered, future violations like those listed in the case could allow the union lawyers to charge Starbucks with contempt of a federal court at other Starbucks stores.
In New York, penalties for civil contempt can be strong. The rulings could
Employees in Buffalo waited for the results of a union vote count last year.
lead to monetary penalties and in some cases imprisonment.
While the union celebrated the Memphis injunction as a landmark win, there were several parts of the injunction that the judge denied.
For instance, the NLRB general counsel asked the judge to order a remedy forcing Starbucks to read aloud the court’s order and share it through an online system called Partner Hub, but the judge declined the request, saying that it went beyond the scope of a remedy for the Memphis workers impacted by the labor violations at that one store.
SUMMER SQUABBLING, INJUNCTION ON DECK
The union was hoping to begin court proceedings on the Buffalo injunction earlier this summer, but the federal judge in charge put the case on hold because it would overlap with the first step of the NLRB’s internal hearing process over the Buffalo Starbucks case, in which an administrative law judge hears the case and issues a ruling to be handed up to the executive board.
For the past two months that administrative hearing resulted in Starbucks attorneys from employer-side labor law firm Littler Mendelson locking horns with NLRB prosecutors in a long series of dueling motions.
A major consequence for the injunction case came in July, when Administrative Law Judge Michael Rosas ruled that swathes of evidence unearthed in the hearing will be transferable to the district court hearings as well. The NLRB’s general counsel demanded sanctions over Starbucks’ “glacial production pace” of providing subpoenaed mountains of internal documents that Starbucks reportedly anticipated numbering in the millions.
Littler Mendelson’s attorneys have responded by making motions against the judge himself, calling his order to turn over evidence to the district court case ”wholly improper” and demanding he reverse course.
Since the initial sparring, sources familiar with the matter said that Starbucks has turned over tens of thousands of pages of evidence and the pace of witness interviews has picked up.
Though the NLRB’s administrative judge has ruled favorably so far for the union, the outlook may not be so sympathetic in federal court.
The federal judge who will be overseeing the case in the Western District of New York is John L. Sinatra Jr. He’s a Trump appointee, and a host of Senate Democrats, including U.S. Sen. Kirsten Gillibrand, voted against installing him in 2019.
Sinatra made headlines last summer when he ruled to place Byron Brown on the ballot in the general election for mayor of Buffalo after Brown lost the Democratic primary to Democratic Socialist India Walton and missed the deadline to get on the ballot with a different party by several months.
Prior to becoming a judge, Sinatra had a prestigious legal career, working as general counsel for the U.S. Department of Commerce under George W. Bush before joining a private firm. There, one of his focuses involved representing parties on both sides of the False Claims Act, a federal law that is typically used to prosecute federal contractors who defraud government programs.
The administrative case wrapped up on Aug. 29 giving both Starbucks and NLRB lawyers the opportunity to file a status report based on where the case stands. Judge Sinatra will decide whether to recommence the discovery process in district court and set a new court schedule for the injunction case. ■
By Eric Holmberg
A VENTI-SIZED UNION
It’s only taken a year for a couple hundred Starbucks stores to organize.
SINCE THE FIRST employees at three Starbucks stores in Buffalo filed petitions to unionize about one year ago, Starbucks Workers United has quickly grown this year. More than 200 Starbucks locations have approved a union, while about 45 rejected forming a union, according to data compiled by pro-labor union group More Perfect Union.
While the movement started in Buffalo, other Starbucks locations in Manhattan, Queens, Brooklyn, Long Island and upstate have all voted for a union this year.
Here’s how much the movement has grown – and how quickly it has grown – in the past year.
STARBUCKS UNION PETITIONS FILED BY MONTH
AUG 2021 SEPT 2021 OCT 2021 NOV 2021 DEC 2021 JAN 2022 FEB 2022 MAR 2022 APR 2022 MAY 2022 JUN 2022
