February 21, 2007 Issue (70k ) of Negotiations Update

Important alert

The mandatory insurance pool called for by Senate Bill 426A does interfere with local collective bargaining rights for all parties, despite what bill proponents are saying. It reduces your collective power of choice.

Local boards now choose their health insurance company only 40 percent of the time. The rest of the time, the carrier is chosen by the local union or by the union in concert with the district. Benefit plans are chosen by mutual decision 68 percent of the time, by the union 29 percent of the time, and by the district only three percent of the time. 

SB 426A takes these collective-bargaining rights away from local unions and school boards. The choice of plans would be given to eligible employees. Note these bill sections:

Section 4: ". the board shall provide options under which an eligible employee may arrange coverage ." Subsection 3, lines 10-11.

Section 5: ". the total cost per month of the coverage afforded the employee under the plan for which the employee exercises an option." Subsection 2, lines 33-37.

Section 8: " . any part or all of the district contribution for employee benefits in cash to the employee." Subsection 2(d), lines 31-32.

Because the bill would establish in statute the individual employee's right to choose benefit plans, a collective bargaining agreement would not be able to change or restrict that right. This would include the individual right to receive cash for the benefit contribution. What remains is merely a restatement that districts and unions must bargain the "costs" of the benefits - but that is all.

Section 14: "A district is obligated to bargain with employees of the district or with the exclusive representative of the employees concerning the district's costs of benefit plans." Subsection 3, lines 27-28.

Insurance cap monkey wrench

If the bill grants rights to individuals to choose any plan or combination of benefit plans, then current cap structures in collective bargaining agreements need to be revised. Contracts currently restrict coverage choices to two or three plans, and not all employees use all of the cap dollars available. Pooling arrangements are common in districts; some use unit or composite rates.

Individual employee choices from a large menu of options - with the only practical limitations of eligibility and the amount of the cap - will force boards to re-negotiate caps from the composites to establish caps for different coverage levels: single, two-party and family policies. Only one district (Rainier SD) has such a cap arrangement.

This bill is coming to a vote in the Joint Ways and Means Committee, Friday, Feb. 23, 2007.

More on SB 426