BA Reform? Think Bigger

December 4, 2008

There’s no better indicator of the sorry state of Connecticut’s fiscal-policy “debate” than the latest push for reforms of binding arbitration (BA) at the municipal level.

BA is the mechanism by which contract disputes between managers and union bosses are resolved by an allegedly impartial arbitrator. According to a 2005 legislative study, “the process is based on parties submitting their last best offers on each disputed issue … . The general concept … is that it forces the parties to make ‘reasonable’ offers on each issue under dispute because of the risk that the arbitrator(s), who can only choose from the parties’ offers, will not select an unreasonable one.”

Connecticut’s leading proponents of fiscal sanity agree that local-government BA is biased toward higher spending. Some taxpayer activists want it repealed. In the depths of the state’s last recession, former Governor John Rowland proposed a multi-year moratorium. For several years, wishy-washy Republicans in the legislature -- with former state senator Lou DeLuca often leading the way -- have suggested a menu of BA reforms, including:

* parity between the BA rules for municipalities and state government

* the exemption of municipal fund balances from the “ability-to-pay” formula used by arbitrators

* a requirement that arbitrators pay special attention to the municipality’s property-tax burden

Presently, the Nutmeg State’s cities and towns are so strapped for cash, even the Connecticut Conference of Municipalities (CCM), the lobbying behemoth that represents expenditure-crazed local politicians, has endorsed a tightening of BA deadlines. CCM’s proposal is an attempt to avoid “sizable liabilities for retroactive pay and benefits” from disputes that “drag on for months and, in some cases, years.” (Predictably, Governor M. Jodi Rell has endorsed CCM’s scheme.)

Given the poor condition of municipal coffers, there’s a chance -- albeit a small one -- that 2009’s legislative session will produce the first alterations to municipal BA in many years. If so, lawmakers and the governor will claim credit for being “fiscally responsible” and offering “property-tax relief.”

Don’t be fooled. Real reform of municipal-personnel costs would involve the repeal of forced unionism.

As the Mackinac Center for Public Policy’s Thomas W. Washburne and Michael D. Jahr observe: “Collective bargaining, with its roots in the industrial, mass-production sector of the economy, operates under a ‘factory model’ of bargaining: One size fits all. In this system, unions focus on securing for their members contracts with uniform benefits, working conditions and salaries.”

It’s a crazy scheme, one that no sane managers -- and no industrious employees -- want controlling their relationships. Supervisors need the flexibility to reward stars and punish laggards. Employees need incentives to be more productive. (What’s the reason to work harder or suggest innovations when you’ll receive no better compensation than slackers in your “bargaining unit”?)

But a less-discussed liability of forced unionism is the way it removes management’s authority over its shop. Union boss-engineered pettiness is a constant presence in the Nutmeg State’s public sector. In local government, “grievances” have been filed over the use of a towing service rather than city mechanics, the administration of a test for police officers, the creation of new school-district jobs, and one unfortunate mayor’s decision to remove a metal grate from a storm sewer himself, without calling in four union laborers at overtime rates to complete the task. (A Rhode Island court recently overturned an arbitrator’s ruling that that a government-school district had improperly combined its music and arts departments, because it didn’t ask the teacher union’s permission first.)

Clearly, compulsory unionism in Connecticut’s municipal government has jumped the fiscal shark -- and for the sake of overburdened taxpayers, it must be repealed. But contrary to labor-boss spin, doing so won’t turn local-government workplaces into hellholes. The existence of tens of millions of satisfied American employees in non-union offices and factories suggests that “representation” has outlived whatever dubious usefulness it once had.

Collective bargaining in Connecticut cities and towns -- and at the state level, for that matter -- needs to be replaced with policies that link compensation to performance, while at the same time protect employees from abuse by unreasonable managers. Best personnel practices from the private sector should be substituted for a rigid system that fosters employee apathy and hinders labor productivity.

When you accept the central assumptions of your opponents, you’ve lost the battle before it has commenced. Connecticut’s fiscal reformers must reject tinkering with the broken rules that govern municipal employment. Forced unionism itself is the problem, and it needs to go.

D. Dowd Muska is a writer, commentator and lecturer. His website is www.dowdmuska.com.

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