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No health contribution in state worker contract

Published: Friday, March 8, 2013 11:05 a.m. CST

DES MOINES (AP) — Workers in Iowa’s largest public-sector union won’t have to contribute to their health insurance, but they will not see an overall raise under a new two-year contract issued by an arbitrator Thursday.

The contract for the 20,000 members of Iowa Council 61 of the American Federation of State, County and Municipal Employees includes no raises, except for step increases for workers who haven’t reached top pay scale.

Local 61 President Danny Homan said the union and Gov. Terry Branstad agreed on wage terms during negotiations, but the process went to neutral arbitration in February because the two sides couldn’t resolve health care.

Branstad called for union members to start paying a portion of health care costs, while the union sought to maintain current benefits. Homan said workers agreed to no pay increases in order to maintain their current benefit plans, for which most members pay no monthly contribution.

“That was one of the arguments we made at the arbitration hearing, that the reason we agreed to do a two-year wage freeze was solely for the purpose of keeping our health insurance at the current rate,” Homan said. “That was the quid pro quo.”

In a statement, Branstad said he was disappointed by the health care decision.

“For the first time in bargaining history there will be no across-the-board pay increases for the duration of the contract,” Branstad said. “I am disappointed that Iowa will continue to be one of only six states where the overwhelming majority of state employees will continue to pay nothing toward their health insurance.”

But the Republican governor said this plan will be more affordable than a contract with across-the-board raises.

The award, which starts July 1, will cost the state an additional $107 million over two years, according to the governor’s staff. Branstad said this was the first time since the state started collective bargaining in 1977 that a contract has included no pay increases.

Branstad said earlier this week that he would not appeal the terms of the arbitration award.

Contracts have been settled through arbitration just twice before since Iowa state workers started collective bargaining. One arbitration deal was reached in 1991 during Branstad’s previous run as governor. Then, Branstad vetoed a salary bill for the union, and the workers successfully sued.