Revealed: latest fire department arbitration award
Shuttered since 2012, Plymouth Township Fire Station No. 2 served the Lake Pointe Village subdivision
Sept. 30, 2014 PLYMOUTH VOICE.
Plymouth Michigan News
Details of the cruel and often nasty dispute between Plymouth Township officials and their local fire fighters union after the townships combative breakup with the City of Plymouth over fire and emergency services in 2012.
“The Township has forced the Union into Act 312 litigation in four of its last five contracts and consistently seeks unreasonable and unprecedented concessions. Absent a change in the Township administration, the Union has no reason to believe that it will not face similar challenges in 2016.”
Early in 2012, Arbitrator A. Robert Stevenson issued a devastating Act 312 award to the Plymouth Township Fire Fighters, Local 1496.
The Township had presented a case of financial hardship resulting from the City of Plymouth’s withdrawal from an inter-local agreement for the Township to provide fire suppression services to both municipalities. The termination of the inter-local agreement resulted in a reduction in revenues to the fire department approaching $1 million.
Prior to and during the Act 312 hearing, the Township laid off nine bargaining unit members resulting in a savings of nearly $1 million. Despite the Employer engaging in such self-help, Arbitrator Stevenson granted an award exacting concessions from the bargaining unit nearing an additional $1 million.
The most injurious portions of the award closed the Local’s defined benefit plan, placing new hires in a defined contribution plan and accelerating the required funding in the closed defined benefit division, while simultaneously putting a cap on Employer contributions to the fund and leaving the lion’s share of the burden for funding the defined benefit upon the members of the bargaining unit. At its worst, this resulted in members of the bargaining unit contributing 31% of their pay to the pension fund for eight months during 2013.
On June 19, 2014, Arbitrator Michael Falvo issued an award in the Union’s most recent Act 312 case granting significant relief from some of the most onerous portions of the prior award.
Explicitly finding that the Township had the ability to pay for the benefits sought by the Union, Arbitrator Falvo restored the Union’s prior vacation time accruals and doubled the personal leave time available to members of the bargaining unit. Most importantly, while declining to restore new hires to the defined benefit pension system, he did award the Union its last offer of settlement imposing a 10% cap on employee contributions to the defined benefit pension.
This relief came at a heavy price, however.
The Employer brought another pension issue seeking to bridge the multiplier for the defined benefit pension from 2.8%, frozen, to 2.0%. The Union responded with a concessionary last offer of settlement of a frozen 2.5%, yielding nearly $1 million in savings in accrued unfunded liability. Arbitrator Falvo awarded the Union its last offer of settlement.
Other significant victories for the Union in this award include maintaining the status quo against proposed draconian concessions on retiree healthcare eligibility, overtime equalization, and food allowance. In total, the Union prevailed on twice as many issues as the Employer.
Although this award is a significant improvement over the prior award, the Union recognizes that the breathing room it affords is just for the duration of this contract, which runs through March 31, 2016.
The Township has forced the Union into Act 312 litigation in four of its last five contracts and consistently seeks unreasonable and unprecedented concessions. Absent a change in the Township administration, the Union has no reason to believe that it will not face similar challenges in 2016.