Binding arbitration tying municipalities in knots
When binding arbitration for police and firefighters was introduced in New York state in 1974, after a big lobbying campaign by the unions, it was regarded as an experiment. But it has been routinely extended by the Legislature. At the end of June it’s set to expire again, and this time should be allowed to lapse — or, if extended, at least limited.
The reason is that the system, which makes binding arbitration compulsory as the final stage of a labor impasse, is so one-sided that it discourages and distorts collective bargaining. The unions know they’re going to get, if not all they ask for, at least a good deal from the arbitration panel (which consists of one person chosen by the employer, one by the union, and a mutually acceptable third party, who serves as chairman). So they have little reason to seriously negotiate, especially since they also have the Triborough Amendment, which keeps in force most of the provisions of the previous contract, including “step” and longevity increments, after it has expired.
The arbitrators are required to look at compensation patterns among “comparable” jurisdictions — i.e. what other police and firefighters in the area get — so one excessively lucrative contract leads to another. They’re also supposed to consider a municipality’s ability to pay, but never seem to.
The result, according to a new report by the Empire Center for New York State Policy, has been average salary increases of 3.3 percent for police and firefighters in the years since the 2008 recession, down only slightly from the 3.6 percent increases in the five years before. And, over time, salaries that have grown far faster than other unionized public employees’, making police and firefighters easily the best paid in the state. Add generous health benefits, and early retirement with pensions based on those salaries (often inflated by overtime in the final years), and police and fire costs are pushing many municipalities to the financial brink.
The Legislature could allow the binding arbitration law to expire at the end of June, and let police and firefighters negotiate just like other unionized public employees, such as teachers. Or it could keep arbitration but limit awards to 2 percent for base salary, steps and longevity increments, as New Jersey did in 2010 (and, ideally, benefits as well). At the very least, it should cap awards for fiscally distressed municipalities, as Gov. Cuomo proposed in his executive budget, a provision that, unfortunately, was dropped in the adopted budget.