City Agrees to New Contract with DCEA, Ending a Decade-Long Standoff

In early 2010, a Davis City Council led at the time by Mayor Ruth Asmundson voted to impose the last, best and final offer on the Davis City Employees Association, after not being able to reach an agreement during the middle of the economic downturn. That would begin a long and protracted standoff between the city and the employee group, which would see that impasse overturned by PERB (Public Employment Relations Board) in November 2011, layoffs in the spring of 2012, another imposed contract in 2013, and no agreement until now.

To put into perspective how long this standoff has lasted, the current agreement was agreed to in 2005 and expired on June 30, 2009.  The current terms were imposed on November 19, 2013, and these terms included requirements for employees to pay the full employee portion of CalPERS (California Public Employees’ Retirement System) pension costs, and made changes to the employee benefit cafeteria program.

After ten years of ongoing negotiations, the two sides have finally come to a tentative agreement.

This is no small bargaining unit – DCEA is comprised of 80 members, about one-quarter of the city’s workforce.  The agreement sets in place changes to wages, benefits, and conditions of employment for a term that starts July 1, 2017, and ends June 30, 2021.

With this 4-year agreement, “DCEA will move to a re-structured retiree medical plan for future retirees that is in alignment with the structure in place citywide.”

One of the changes in the contract is that it goes from looking at salary to total compensation “in acknowledging the impact unforeseen changes in the CalPERS pension rates have on the finances of the City.”

Staff writes: “As with the other labor groups for which Council recently approved contracts , the City and DCEA representatives have worked collaboratively to address the City Council’s goal of CalPERS pension costs being part of the discussion relative to compensation, and this contract provides for an employee cost/benefit sharing mechanism, as do other employee contracts.”

The city continues their assumption of an annual 2 percent compensation COLA.

CalPERS has a projection of the expected rate increases for the pension plan over the next several years.  Staff writs that “the MOU provides that the employee will share in the impact of that variance in terms of cost, contributing up to an additional 1% of salary in the form of employee pension contribution.”

The employee group has gone nearly a decade without a cost of living increase and, therefore, when the city conducted a total compensation study, “most benchmarked classifications were found to be below the market median for comparable positions in comparable agencies.”

Because of this, the city has experienced difficulty in attracting qualified candidates for DCEA-represented positions.  Thus, the city has agreed, as part of the MOU, that “the benchmarked classifications and associated classifications shall receive a market adjustment to 5.26% below median.”

Term of Agreement

• July 1, 2017 and ending June 30, 2021

Market Adjustment – effective November 19, 2018

• Public Works Maintenance Worker II and associated classifications – 7.17% Market Adjustment
• Building Maintenance Worker II and associated classifications – 4.38% Market Adjustment
• Electrician and associated classifications – 8.21% Market Adjustment
• Equipment Mechanic II and associated classifications – 9.77% Market Adjustment
• Wastewater Treatment Plan Lead Operator and associated classifications – 4.27% Market Adjustment

Cost of Living Adjustment

• Fiscal year 2017-2018 – 2% effective December 3, 2018
• Fiscal year 2018- 2019 – 2% effective December 17, 2018
• Fiscal year 2019-2020 – 2% effective pay period following 7/1/19
• Fiscal year 2020-2021 – 2% effective pay period following 7/1/20

Pension Cost Sharing

• Fiscal year 2019-2020 – Employee pickup of up to 1% pension cost share or up to 1% additional salary depending on actual PERS pension rates.
• Fiscal year 2020-2021 – Employee pickup of up to 1% pension cost share or up to 1% additional salary depending on actual PERS pension rates.

One-Time Off Salary Schedule Lump Sum Payment

• 2% of base pay non-pensionable lump sum payment to be calculated on pre-MOU hourly rate, representing one year, plus 4% of base pay non-pensionable lump sum payment to be calculated on pre-MOU hourly rate, representing four months. This lump sum covers the time from the beginning of the contract through actual contract ratification.

Retiree Medical Benefit

• Employees hired on or after November 13, 2018 will be eligible to receive a maximum retiree medical benefit that will pay the Medical Supplemented/Managed Medicare monthly rate for either retiree only or retiree plus one dependent, depending upon actual enrollment at time of retirement. This is approximately one-third of the current benefit offered to employees.

Additionally, current employees retiring prior to December 31, 2019, will see no change in benefit.

Those hired before July 1, 1996, who retire after December 31, 2019, “will receive 100% of the premium for the plan available through Kaiser for retiree plus one dependent until Medicare enrollment, at which time the value of the benefit is reduced to the cost of Medicare Supplemental/Managed Medicare plan.”

Those hired after July 1, 1996, “will receive an amount equal to 50% of the premium for the plan available through Kaiser for retiree plus family until age 60. After age 60, the benefit changes to the value of 100% of the premium for the plan available through Kaiser for retiree plus one until Medicare enrollment, at which time the value of the benefit is reduced to the cost of Medicare Supplemental/Managed Medicare.”

—David M. Greenwald reporting