City Council Tells Employees to Layoff, Approves Tentative Budget
The package includes an early retirement incentive
Thursday, Jan 7, 2010 | Updated 2:43 PM PST
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The Los Angeles City Council unanimously approved a tentative budget package today that includes layoffs for an unspecified number of employees, but eliminates mandatory furloughs for thousands of others.
The budget package also includes an early retirement incentive program that is expected to take about 2,400 employees off the city payroll.
The City Council dropped plans to lay off 926 employees and require 21,000 members of the Coalition of Los Angeles City Unions to take 26 furlough days -- but not before coalition leaders agreed to significant concessions during marathon negotiations that lasted three days.
City Administrative Officer Miguel Santana, who led the city's bargaining team, said the coalition promised to help reduce the city's $405 million deficit by at least $105 million.
Sources familiar with the talks said labor leaders agreed to defer its members' pay raises and some cash bonuses. They also agreed to let the city transfer some of their members to proprietary departments like Los Angeles World Airports, the Department of Water and Power and the Port of Los Angeles.
The deal still has to be ratified by coalition members then be approved again by the City Council -- a process that could take 30 days.
Santana said the city will lay off an unspecified number of employees who are not members of the coalition to help balance the budget. Furloughs will also still be mandated for 6,400 members of the Engineers and Architects Association, whose negotiations with the city broke down in July.
The City Council also approved an early retirement incentive program after labor leaders tentatively consented to increasing their members' pension contributions by 1.07 percent, instead of just 0.75 percent under an earlier agreement. Also, employees who take advantage of the ERIP must pay 1 percent of their retirement benefits into the pension fund.
But before any changes in pension contributions can take effect, another actuarial study must be conducted. Also, the plan must be presented to all unions who contribute to the pension plan, not just the coalition.
Although the exact number of city employees facing layoffs was unknown, Mayor Antonio Villaraigosa said today's pact saved hundreds of jobs.
“Today's agreement yields nearly $78 million in labor concessions that were not on the table in the original proposal,” the mayor said. “Together we saved the jobs of more than 850 employees because we were willing to stand firm and refused to back down.”
