The state’s largest public workers union is voting Friday on an agreement with the Murphy administration that promises none of its 35,000 members would be laid off through December 2021 “no matter what happens with the economy.”
Gov. Phil Murphy first announced the tentative agreement earlier this week, which promises that workers would be furloughed and not laid off. Under the deal, CWA members agree to defer annual pay increases.
The COVID-19 pandemic and ensuing government response have led to one of the worst economic downturns in American history. And it’s meant steep drops in tax revenue, on which the state relies, and as a result, steep budget cuts the state will have to implement for at least the next year.
“We have worked hard with the CWA to structure these furloughs to maximize state savings while minimizing the financial impact on our employees,” the governor said Tuesday at his daily COVID-19 press briefing at the Trenton War Memorial.
Under the memorandum of understanding, state workers will get an average of 10 furlough days between June 29 and July 31, which is when the expanded $600 of unemployment runs out under the federal Coronavirus Aid, Recovery and Economic Security Act.
Workers will also be furloughed the day after Thanksgiving in 2020 and for President’s Day in 2021. They would lose at most five days of pay, the document reads.
While furloughed, they will receive the same level of health benefits.
A 2 percent wage increase schedule for July 2020 will be delayed. Instead, workers would get 2 percent raises in July and December 2021. The agreement calls for a 2 percent pay increase in July 2022, which is just an April pay increase delayed by three months.
“Deferring wage increases and having workers furloughed, even for a few days, is difficult,” the CWA said in a June 23 Facebook post. “But in an environment such as this, we believe that we have accomplished something remarkable.”
The CWA said the agreement is effectively better than the deal it received over a decade ago during the Great Recession. New Jersey’s unemployment peaked then at 9.8 percent, compared to the staggering 16.3 percent unemployment rate from this past April.
“The crisis we face now is much, much worse and promises to have more long-term effects,” reads the agreement summary. “However, we have negotiated an agreement here that will protect our jobs. And we have done so while not having members sacrifice as much as we did in 2009.”
Too little, too late?
The new deal mirrors several aspects of a proposal rolled out by Senate President Stephen Sweeney, D-3rd District, in May that he said could save hundreds of millions of dollars by partially furloughing up to 100,000 state and local workers. State and local governments could cover the costs of retirement and health benefits, while the state unemployment system – and the federal expansion of the aid – would cover the lost income for workers.
On May 22, the administration said it would allow public workers to take voluntary furloughs.
Murphy has taken a much softer stance to public unions than Sweeney, saying as recently as Tuesday, in a statement, that he “prefers negotiating in good faith with our workforce and bringing people to the table,” in order to negotiate cheaper health and retirement plans.
“We cannot hide the impact this public health emergency is having on our state finances,” the governor added on Tuesday.
Still, Republican lawmakers were highly critical of the agreement, saying it was too little, too late.
“By not implementing broad furloughs months ago when much of New Jersey, including most government offices, were shut down, the opportunity to achieve savings has been greatly diminished,” reads a Thursday letter by the state Senate’s 15 GOP lawmakers.
“Compensation appropriated through the federal CARES Act is set to expire before the end of July, leaving workers who are furloughed after that date with far less financial support than if furloughs had been implemented earlier, as urged by the Legislature.”