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October 6, 2012

Council to act on union pay hikes

(Continued)

Last week, the agreements were brought before the City Council’s Finance Committee, which debated at length over the reliability of the Mayor’s numbers and over the merits of granting union employees pay raises. The Finance Committee consists of all 9 City Council members.

“The struggle always is on this matter whenever there is any pay raise involved, some people want to just focus on that,” Kezer said. “What I expressed strongly to the councilors was with this whole agreement, you have to look at salaries and benefits, the whole package.”

Prior to the meeting, Kezer submitted a memo to the councilors explaining the new contracts and how the deal would result in a net savings for the city. The memo includes three charts, one that details the city’s health insurance savings over the next three years, one that details the yearly costs of each of the four union contracts and one that calculates the city’s net savings using those figures.

According to the memo, Amesbury will save $794,484 in city health insurance over the course of the three-year agreement. The total cost of the four agreements, taking into account both the pay raises and the concessions, will add up to $497,200, meaning the city would save a total $297,284 based on those numbers.

Kezer praised the city employees for taking a big leap of faith by agreeing to the changes in the health care plans before any agreement on the contracts was approved, and added that the savings were only possible because all four unions agreed to the changes.

“By the employees agreeing to the health savings under this process, the city avoided having to go through the process of adopting and following the new municipal health care law, which would have delayed any savings until next year and would have required the city to pay a 25 percent health savings mitigation cost to the city’s employees.”

Kezer estimated that the city’s mitigation cost would have been $92,851 before negotiating any new collectively bargained contracts.

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