Christie Enters Contract Talks With Weary Public Unions

New Jersey Governor Chris Christie is headed into contract talks with unions that are still smarting over wage freezes and higher health-care payments imposed during his first term.

Negotiations with all employees except state police are slated to begin this month, according to a bond offering statement. Workers affected have four-year contracts that expire on June 30. No talks have been scheduled, said Michael Drewniak, a Christie spokesman.

The Republican governor, 52, persuaded Democrats during his first term to support an overhaul of pensions and benefits. The agreement allowed unions to bargain for lower health premiums after four years, or in the upcoming contract talks. Employees are hesitant to make any more concessions, said the director of the largest union for state workers.

“You can’t squeeze blood from a stone -- the concession stand is closed,’” said Hetty Rosenstein of Communications Workers of America, which represents about 40,000 of 74,000 state workers. “They don’t believe in collective bargaining. Everything Christie does now is about politics. It’s about the fact that he wants to run for president.”

Union Spats

Christie became a national Republican figure after his spars with labor unions and his calls for smaller government. When he ran for re-election in November, Christie touted his ability to work with Democrats who control the legislature, and said it was a lesson for federal politicians. The governor said as recently as Oct. 1, in a televised interview, that he was considering running for president in 2016.

In 2011, Christie signed bills raising the minimum retirement age for new hires and freezing cost-of-living adjustments. He also raised workers’ health-insurance contributions to as much as 35 percent of the cost of their premiums based on income, from a flat 1.5 percent of salary. Christie initially sought to force all workers to pay 30 percent of the premium cost by 2014, a move Democrats fought.

Also that year, Christie negotiated a two-year wage freeze with unions, followed by raises of 1 percent in the third year and 1.75 percent in the fourth.

The legislative and negotiated changes amounted to a pay cut of as much as 6 percent, Rosenstein said. Her union’s negotiations often serve as a bellwether for the labor pacts governing all state bargaining units.

More Givebacks

Christie said in February that unions and Democrats must agree to more changes in retirement and health plans because his 2011 overhaul didn’t go far enough to contain costs. The state’s escalating benefits burden has been cited by credit analysts in eight downgrades during Christie’s administration, a record for a New Jersey governor.

Senate President Stephen Sweeney, a West Deptford Democrat who backed Christie’s first-term benefits overhaul, said the governor won’t get any support from him this time because he broke his promise to make $2.5 billion in extra pension payments in fiscal 2014 and 2015.

As part of the 2011 changes, Christie signed a law requiring the state to make gradually higher pension payments until it reached full funding in fiscal 2018. The governor cut those contributions this year to balance the budget after income-tax collections fell short of his targets.

“If he wants to make health-care changes then he should go to the unions and negotiate for it,” Sweeney said in an Oct. 8 interview. “We have workers who are paying dramatically more than they ever have in the past. After we did all these things, he reneged.”

$90 Billion

New Jersey has a $90 billion unfunded liability for retirement and health obligations after a decade of skipped payments and expanded benefits, according to a Sept. 25 report by a 10-member panel that Christie appointed. The panel is scheduled to release its full findings, which will include recommendations for closing the gap, this month.

Democratic lawmakers say the funding deficit is because of the state’s failure to put in enough money, not the size of the benefits or employee payments.

Drewniak, the Christie spokesman, declined in an Oct. 6 e-mail to discuss specifics of the talks or what Christie will seek at the table. He said the current contract was the product of negotiations and was ratified by all major unions. Over the past 15 years, unions were happy to go to lawmakers seeking pension boosts, he said.

The spokesman denied claims by Rosenstein that the state didn’t bargain in good faith during the last talks.

“Having a governor who is actually driving a hard bargain on behalf of taxpayers must still feel like a shock to the system for the public employee unions and their Democratic patrons in the legislature,” Drewniak said.

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