The Commonwealth’s Big Labor Problem

by John Marino

February 28, 2003
Copyright © 2003 THE PUERTO RICO HERALD. All Rights Reserved.

. JOHN MARINODuring an interview to mark her mid-term in office last December, Gov. Calderón smirked when she was asked what she thought about the unionization of public employees that her predecessor had undertaken.

"This is an administration that respects laws, and we respect the public unionization law," she said, adding that her administration has sought to reach a "consensus" with union leaders on several issues, including stimulating economic development. "We had union leaders sitting down with businessmen. This administration has achieved labor peace."

Two months later, that peace appears pretty close to broken as public employee unions threaten to strike if the administration does not make good on the raises negotiated through collective bargaining contracts at several government agencies.

It’s ironic that Calderón has raised the ire of unions representing public workers -- considering the give-aways to government employees in her budget earlier this month.

She promised another $100 monthly pay raise for public employees starting in January and increased their annual Christmas bonus to $1,000. She also raised the bottom level of public employee pensions by $100 monthly, increased their Christmas bonuses by $100 and will begin paying them $100 annually to help defray the costs of prescription drugs.

Meanwhile, the Popular Democratic Party-led Legislature is considering a bill that would exempt the soon-to-be $1,000 Christmas bonuses for public employees from taxes.

Yet, labor is screaming that the first executive is reneging on her commitments. The problem: workers in some government agencies negotiated salary increases with different agencies that went beyond Calderón campaign pledge to raise salaries by $100 monthly, each year, during her four-year term. (The next budget increase delays this increase by six months, which is one source of criticism.)

But at many agencies, management and unions agreed to salary increases in excess of $100 monthly. For example, the sprawling Education Department pledged a $150 monthly increase and island schoolteachers are now in an uproar they will only get $100 monthly, and six months after expected. Other agencies in the same bind are the Public Service Commission and the Family, Health, Transportation and Public Works and the Natural and Environmental Resources departments.

The current impasse will be overcome. The opposition in the New Progressive and Puerto Rican Independence parties is lining up behind labor and lacing into the administration. Public opinion also appears on the side of public employees. After all with one-third the workforce employed by the government, nearly everyone has a loved one who would be affected by the raises.

Calderón undoubtedly will find the cash for the raises – at the latest starting in January -- and will pledge to make up the difference later on in her term, like shortly before the election, as shortly as possible.

The attention to public employees by governors bent on reelection has a long history in Puerto Rico. And former Gov. Pedro Rosselló brought unions into the commonwealth’s bloated bureaucracy. Regardless of parties – commonwealth or statehood, Republican or Democrat – governors have always catered to the massive public workforce.

Rosselló’s public employee unionization initiative gave U.S. big labor its largest new target for increased participation in years. It was generally seen as a tit-for-tat pay-off to labor in exchange for its support for statehood. But despite its deficiencies, Rosselló’s public unionization law fundamentally changed the relationship between public employees and its commonwealth employer.

Campaign pledges like Calderón’s, and Rosselló’s immediately before her, to give public employees sweeping pay raises need to be a thing of the past. Such discussions are best left at the agency level, as the current controversy shows. While agency heads are saying a clause in the labor agreements allow them to drop economic pledges if government revenues fall short, the budget chiefs say the agencies will have to cut resources elsewhere to honor the pledges.

The bottom line is that such sweeping pay promises are bad administration now that public employees are unionized. For the sake of clarity, such decisions should be left to the agency level. More importantly, governors should make no more pay pledges because they simply become the floor for negotiations with labor.

Neither Gov. Calderón, nor any of her challengers, should ever again pledge such pay hikes to public employees now that they have collective bargaining rights. That kind of paternalistic gesture no longer works. Despite the deficiencies of public unionization, chief executives need to use the model to take questions of pay and benefits out of political campaigns and put them back into the agencies where they belong.

And if the Legislature dares pass the legislation exempting from taxes the Christmas bonuses of public employees, the governor needs to quickly veto it. It is an immoral law that grants public employees a right that the great majority of Puerto Rican laborers – the two-thirds of the workforce sweating it out in the private sector – will have to pay for.

A transparent government is not just a government free of crooks. It is a government that does not make pledges it cannot afford to pay, or grant benefits to one special interest group at the expense of the larger majority.

John Marino, City Editor of The San Juan Star, writes the weekly Puerto Rico Report column for the Puerto Rico Herald. He can be reached directly at: Marino@coqui.net

Self-Determination Legislation | Puerto Rico Herald Home
Newsstand | Puerto Rico | U.S. Government | Archives
Search | Mailing List | Contact Us | Feedback