Pact satisfies neither O'Malley nor AFSCME

1-year contract may set stage for future labor battles

October 04, 2000|By Gerard Shields and Neal Thompson | Gerard Shields and Neal Thompson,SUN STAFF

In the first major showdown between Mayor Martin O'Malley and the city work force, it appeared as if the workers blinked first.

But as union officials, workers and observers this week assessed the damage, some say O'Malley's first union scuffle was more a draw than a victory.

The 5,000 members of the American Federation of State, County and Municipal Employees (AFSCME) Local 44 settled this week for a 2.25 percent pay raise - far less than the 10 percent they had sought - and agreed to start paying more for their prescription drugs.

But O'Malley's negotiators conceded on some issues, too, and the lack of decisive victory for either side might have set the stage for future battles.

"This represents a postponement of a fight," said Matthew A. Crenson, a political science professor with the Johns Hopkins University. "They've just decided that this is not the time to fight."

While AFSCME leaders and workers expressed disappointment with their new, one-year contract, city leaders weren't thrilled with the outcome, either.

Earlier this summer, administration officials said they hoped to scale back costly work practices that have crept into the city work force such as excessive overtime and sick leave.

But the late-night, closed-door contract ratification by AFSCME on Sunday did not include concessions on those issues. The city also backed off its demand that workers pay more for health care.

Even O'Malley viewed the settlement more as a "compromise."

"That's why it doesn't satisfy anybody," he said yesterday.

Facing down a city work force can make or break a mayor, and O'Malley has been trying to learn from leaders like former Philadelphia Mayor Ed Rendell. Rendell stood fast in his 1992 showdown with city unions, accepted the risk of a strike, and then won major concessions.

But at the same time, O'Malley doesn't want to risk his political future by alienating workers who are also voters.

"Any politician would think twice before alienating a group as large as AFSCME," said Thomas A. Mills, a former Philadelphia finance officer and a senior lecturer at the University of Pennsylvania's Fels Center of Government. "Because they [city union members] are also very active political influentials."

Mills said O'Malley appears to be following Rendell's method of confronting unions early in his administration. "And then he [Rendell] had another three years to heal some of the wounds he created," Mills said.

David L. Cohen, Rendell's former chief of staff, said O'Malley isn't facing the same type of fiscal crisis that empowered Rendell to stare down the unions. But O'Malley at least gained some concessions without any apparent damage to his relations with the 16,000-strong city work force.

"The mayor essentially got the things he needed and didn't trample on the unions," Cohen said.

Still, other city union members are wondering about the ripple effect of the AFSCME contract. Baltimore's other major union, the City Union of Baltimore (CUB), whose 5,000 members are working without contract, rejected last week an offer from the city similar to the one AFSCME accepted.

CUB union leaders met into the night yesterday to discuss the impact of the AFSCME ratification on its own negotiations.

And Stephan G. Fugate, head of the Baltimore Fire Officers Association, which is battling the city in court over its contract, said AFSCME's decision to ratify its contract puts CUB in an awkward position. He said AFSCME workers "caved" under what he called O'Malley's "hardball tactics."

"To a large extent, the rank and file is afraid of him," Fugate said.

Fugate and others said workers are also afraid of O'Malley's apparent interest in privatizing city services, an idea that business leaders are pushing.

The economics of the AFSCME contract will not help O'Malley's future budgets, which are already headed for a projected deficit of $59 million over three years.

Even though AFSCME agreed to start paying up to $15 per drug prescription - up from the current $5 - overall prescription costs will jump 9.2 percent next year, at a cost to taxpayers of $20 million, said city Personnel Director Jesse E. Hoskins.

And the union's refusal to pay more for health care will also cost the city many millions. Health costs for city workers will rise 4 percent to 12 percent next year, depending on which plan workers are enrolled in, for a total cost to the city of about $9 million, Hoskins said.

Hoskins said the end of the AFSCME showdown was bittersweet. He's pleased the workers made some concessions, but he'd like to see more.

"The projections just don't look that good," he said. "We've got to tighten up."

The city must also find $30 million to pay for the raises it gave police officers earlier this year, which amount to increases of up to 33 percent over three years.

In August, O'Malley sent letters to city workers, warning that the city couldn't afford raises and asking their cooperation. He said the police raises were necessary to make the city safer, which could attract more residents and increase tax revenues that could be shared with employees.

Observers said the letter, and O'Malley's compromise with AFSCME, might have simply bought him some time.

"If he's successful on crime, he can go after other things," said Fred Siegel, an urban affairs expert with the Progressive Policy Institute in Washington. "He would be foolish to take the unions head-on this early; he needs a notch in his belt."

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