State Union Contracts: What the Negotiations Tell Us

According to news reports, the state has reached a tentative agreement on 2021-23 contracts with its two largest public sector unions – the Minnesota Association of Professional Employees (MAPE) and AFSCME Council 5.   The final contract details, as always, will be the focus of media attention and legislator talking points.  But in public sector collective bargaining, the journey is no less important than the final destination.  That’s because collective bargaining in the public sector pits private labor interests not against wealthy owners of capital but rather against the broader public interest as represented by elected officials and their representatives.  Absent insights into how the negotiations evolved, citizens have little ability to evaluate what provisions/changes government representatives believed were needed to advance the public interest or to what degree those provisions were secured or sacrificed in the final outcome. 

This year, thanks especially to MAPE’s commitment to what it calls “radical transparency” (radical because the general public could listen in on and read union updates and access each side’s proposals on its website) we have a little better understanding than usual of how the journey unfolded.  And this year’s journey raises questions that deserve to be asked – not just concerning this year’s contract negotiations and results, but also about the future of the state human capital system.

State Government: “A Terrible Negotiations Partner”

In an April 6^th memo from MMB containing the state’s opening proposal, union representatives were likely stunned to see some major proposed changes to longstanding collective bargaining workforce rules -- especially coming from a DFL administration.  Of primary concern were altered provisions pertaining to workforce processes and procedures, many centering around filling vacancies and dealing with layoffs and recall.    For example, the state proposed eliminating language that in the case of equal job finalists, an individual in the bargaining unit must be selected.  

The biggest waves were created by a direct attack on one of the most sacrosanct features of collective bargaining: seniority.   For example, instead of basing layoff decisions exclusively on the basis of inverse seniority, the state proposed to include consideration of criteria that reflected “skills, experience, and merit of the employee in relation to the needs of the Appointing Authority (i.e. government)” such as:

• professional awards received external to government
• skills and qualifications beyond the minimum requirements of the position,
• demonstrated self-initiative with respect to new programs, processes, or projects
• consistent satisfactory or above performance reviews. 

In addition, the state proposed to eliminate “bumping” rights whereby an employee receiving a layoff notice can take over the job of the least senior employee in the same job class, or another class in which the employee used to work or for which the employer determines the employee is qualified.

To say the least, these types of proposals were not well-received.    In an on-line negotiation update in early June, MAPE representatives described the state as “a terrible negotiations partner” in which “everything feels very anti-union.”  They stated the state’s bargaining position showed “a clear intention of union-busting, pitting employees against one another.” 

Another area of highlighted disagreement existed in the area of how to address workforce equity, diversity, and inclusion (EDI) issues.  MAPE proposed adding 6 pages of new language to the contract comprised of new committees, training, reviews, metrics, and workforce rule and process changes.   Employees not already assigned to an agency Equity, Access and Inclusion Department would be allotted time to work on EDI issues (at the request of management), and those who volunteer to do so would have their workload adjusted to ensure employees would not be unfairly burdened by tasks impeding their normal work performance -- including modifying the employee’s performance measures themselves.   Position descriptions would be updated to make equity work part of staff assigned duties at all agencies.  Hiring processes would be altered.   Equity criteria would have to be incorporated in all position descriptions before posting, and decision-makers in the hiring process would be diversified. 

Well-meaning intentions aside, state negotiators strongly resisted these intrusions into management control.  The National Academy of Public Administration has described government human capital systems as suffering from bureausclerosis – “preoccupied with a process of internal compliance with layers of regulations that advance neither agency mission or merit.”  It seems possible the state saw the addition of these provisions as a recipe for full blown cardiac arrest for the state human resource system.   Instead, recognizing that human resource decisions based exclusively on seniority are very likely to affect a disproportionate number of EDI employee groups, the state proposed including a consideration of adverse impacts of seniority on EDI outcomes in making any layoff decisions.   For MAPE, that was an equity and inclusiveness bridge too far.

A cynic may question the sincerity of the state’s interest in these proposals and view their existence as providing future sacrificial fodder to reach an agreement.  A mega-cynic might wonder how real the tension and rift between a DFL administration and its historical political allies really was and whether the negotiation battle might be better thought of as a World Wrestling Federation script to fire up membership and strengthen the union’s reputation.   It is interesting that, according to MAPE, on July 9^th the state “dropped their remaining egregious, anti-union proposals” even before major economic provisions like health care cost share and cost of living increases had been settled where the state’s greatest bargaining leverage existed.  

However, there is reason to believe that the state’s proposals were serious and that the drawbacks of the current state human capital system are becoming more evident to agency management and leadership.  That may be true because of the experience with COVID.  Emergency Executive Order 20-07 provided state agencies “the flexibility to hire staff, schedule, assign, reassign employees without adherence to limitations in collective bargaining agreement, memoranda of understanding, compensation plans, administrative rules, administrative procedures and policies that present barriers to the needs of state agencies to effectively and efficiently mobilize and deploy their workforce.”  One can’t help but wonder if this experience gave agency administrators and managers a hint of what “could be” with respect to improving effectiveness, efficiency, and accountability in the delivery of government services in non-emergency times.  As a chief administrator in another state has stated “the global pandemic has shown us that we are capable of changing quickly and at scale. Now we have the opportunity to think through which changes we want to make more permanent, along with other changes we want to make to further increase our operational resilience.”[1]

A Half Century of Fitting Square Pegs into Round Holes

“Over the years the basic purpose of civil service systems has been forgotten:  to recruit the most talented among our citizens in government, not to employ legions of classification experts and personnel administrators who spend days tracing bumping routes and rewriting job descriptions.  State and local governments have a hard enough time as it is recruiting the best and brightest without actively discouraging them.”            

Hard Truth /Tough Choices -- An Agenda for State and Local Reform, Report of the National Commission on State and Local Public Service, 1993.  Report to the Clinton Administration.

Even since public union collective bargaining became established in the late 60’s and early 70’s, scholars and public administrators have struggled to address the friction and dissonance between civil service based on merit principles and collectively-bargained labor relations.    Thirty years ago, a journal article from the American Society of Public Administration captured the essence of the challenge:

Although merit principles may be acknowledged and supported by unions, they are not nor can they be the building blocks of unionism.  The union is an instrument rooted in collectivism, designed to counterbalance the employer and ensure equality and uniform treatment of employees. As long as the determination of merit and fitness possesses subjective elements, they cannot be considered legitimate union objectives.[2]  

States have long tried to reconcile this conflict by designating certain subjects in statute with strong merit principle relationships as a “management right” and not subject to collective bargaining.   This same journal article included a statutory review of subjects removed from the scope of collective bargaining in all 50 states.  At that time only 4 of 20 human resource subject areas in Minnesota were reserved by the state through statute as a management right; the rest were the subject to collective bargaining.   Our cursory review suggests little has changed in the intervening years.  Although Minnesota state statute still declares “precedence of merit principles” in its state personnel management policy,[3] as a practical matter collective bargaining constructs have supplanted them and drive the state’s personnel function.  

For the National Academy of Public Administration, the National Association of State Chief Administrators, other good government organizations, and special commissions like that quoted above, the challenges of meeting government’s human capital needs this century demands a recommitment to merit principles by changing the way they are brought to life in human capital systems, including those that are collectively bargained.    The ideas and recommendations of these organizations are major departures from the traditional designs and features of both historical civil service systems and collective bargaining systems that have been a staple of government for decades.    Needed reform doesn’t lie in a law change; it’s the stuff of “state blue ribbon commissions” typically reserved for tax reform, health care, and other complex areas of public policy.  Though no less relevant to effective, efficient, accountable government, the human capital system hasn’t shared the high profile of these other policy areas.

Questions That Need To Be Asked

Meanwhile, this year’s tentative contract agreements and the negotiations leading up to them prompt some important questions - particularly on the management side.   Even though the final details haven’t come out, we have a good idea of what labor interests achieved.  In addition to beating back self-described “anti-union” proposals, MAPE reports they “secured major victories for our members including strong wage increases, added significant benefits to our health insurance with no major changes in out-of-pocket costs or share of premium costs, added Juneteenth as a holiday, secured a large increase to employer contribution to deferred compensation, and more.”   Objectively, when looking at the contract details made available to date there is no exaggeration in this assessment.   For example, over half of MAPE employees are also eligible for step increases,[4] (57% of MAPE membership in the last contract cycle).  For these employees the 2.5% per year salary increase is compounded by an annual 3.6% increase on the employee’s work anniversary (if history holds true) yielding a two-year salary increase of 12.8%.  That’s on top of the 12.5% in the last two-year cycle among step-eligible workers. 

What’s much less clear is how the broader public interest was served in the latest agreements.  Some questions we’d like to hear asked as contracts wind their way through the Subcommittee on Employee Relations and ultimately the Legislature:

• What was the state’s rationale/motivation/interest behind proposals to eliminate bumping and introduce other considerations beside seniority in certain types of personnel decisions?  Has the status quo demonstrated some detrimental effects on state government operations and service delivery?  If so, what are they?

• What caused the state to drop these proposals?   Were any concessions made in return by labor on existing workforce rules that enhanced the state’s flexibility/ control in human resource management? 

• Looking back on the last year while operating under the substantially greater flexibility the Governor’s Executive Order on workforce management provided, are there any areas in human resource management that the state feels generated positive benefits with respect to more effective and efficient government, and therefore deserve to be made a permanent element of state workforce policies and practice?  

• Looking at the totality of the agreements, can the state point to new provisions or elements that advance the public interest in the area of state human resource management with respect to effective, efficient, accountable government -- other than satisfying labor economic interests and maintaining labor peace?

• Looking outside of the agreements, what initiatives are in place to address critical state human resource needs like strategic workforce and succession planning, identifying and filling statewide talent gaps, and upskilling?   How do these strategic initiatives fit with a human resource system whose prime directive and objective is to create uniformity and equity across hundreds upon hundreds of extremely dissimilar “jobs”?

We would not be surprised if most of MMB’s answers to these questions were essentially defensive – like preventing greater inflexibility in government operations and entanglements in new workforce rules.   But as good government organizations and practitioners are telling us, government human resource systems need to be far more flexible, agile and responsive to attract needed talent and address the extraordinary challenges facing government this century, not be one-size-fits-all and preoccupied and mired in administrative rules and process.    Simple defense is no longer adequate to serve the public interest.