A review of the literature on public employee collective bargaining at the local and state level, including the following findings:

• Similar budgetary issues for states with and without collective bargaining laws
• Public employees’ wages lower than wages of counterparts in private sector
• Interest arbitration an effective part of public sector collective bargaining
• Labor-management partnerships working throughout the public sector
• Collective bargaining reduces turnover in the public sector
• Public sector collective bargaining considered an international human right

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Michael Wasser, American Rights at Work, Jan. 2011

A new report takes on misconceptions about state and local finances that have fueled many of the attacks on public employees. The report debunks the following myths: pension obligations will bankrupt cities and states; states and cities are borrowing money to pay salaries and benefits; and out of control spending has states and cities on the verge of collapse. Findings conclude that these longer-term issues should be addressed over the next several decades, rather than factored into near-term solutions to address the projected operating deficits for fiscal year 2012 caused by the weak economy.

» View the report

Iris J. Lav and Elizabeth McNichol, Center on Budget and Policy Priorities, Jan. 2011

Jeffery Keefe of Rutgers University conducted a study to compare the hourly rate of public and private sector employees, controlling for education, experience, hours of work, organizational size, race, gender, ethnicity, and disability. It found that local and state government workers are undercompensated compared to their private sector brethren.

• On average, public sector workers are paid 3.7% less than similarly situated, full-time private sector employees.
• The comparison is closer for local public employees (1.8%) than state workers (7.6%). 

The study also found other differences discussions about public sector compensation often fail to take into account. State and local governments pay a higher percentage of employee compensation in the form of benefits (34.1%), as opposed to the private sector (26.1-33.1%). The forms of benefits vary between the two sectors:

• Health insurance: 11.2% of public sector compensation; 6.3-8.3% of private sector compensation.
• Retirement benefits: 8.1% of public sector compensation; 2.8-4.8% of private sector compensation.

Differing pay levels between the public and private sector are affected by education differences amongst the workforce: 54% of full-time state and public workers earned at least a four year college degree; only 35% of private sector workers have the same.

» Summary
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Jeffrey H. Keefe, Economic Policy Institute, Sept. 2010

In 2003, the Public Sector Labor-Management Committee and the John F. Kennedy School of Government at Harvard University studied successful public sector labor-management partnerships through a case study analysis of four public services. Their findings include:

• Ohio: The Toledo Public Schools and the Toledo Federation of Teachers, AFT Local 250, developed the Toledo Plan in 1981 as a way to train and develop teachers and improve student performance. In addition to improving student test scores across a variety of subjects, the school district and teachers have had no disputes over teacher dismissal. The Toledo Program serves as a model for labor-management collaboration.

• Pennsylvania: The city of Philadelphia formed a partnership with employees represented by AFSCME, Fraternal Order of Police, and the International Association of Fire Fighters in 1996 to address budget challenges. The Redesigning Government Initiative includes both a city-level committee and individual department programs to address both strategic and day-to-day issues. The program requires labor and management to develop programs within a “Win-Win-Win” framework that seeks improvements for the city budget, workers, and citizens. An example of the program’s success is found in the police department’s forensic science laboratory: a department level labor-management committee streamlined processes to reduce costs and improve productivity, thus eliminating the backlog of cases in 2002.

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Allyne Beach with Linda Kaboolian, The Public Sector Labor-Management Committee and The John F. Kennedy School of Government at Harvard University, Aug. 2003

U.S. Secretary of Labor Robert Reich’s 1996 Task Force on Excellence in State and Local Government through Labor-Management Cooperation found that for governments with labor-management partnerships, taxpayers benefitted from better service and more cost-effectiveness, while employees experienced a better quality of work life.

As part of the task force’s work, it commissioned a random sample survey of public sector workers, finding a strong interest in labor-management collaboration and a desire to provide input on services and workplace issues. The task force highlighted several labor-management partnerships from around the country, including:

• Connecticut: The state Department of Mental Retardation partnered with the New England Health Care Employees Union to reduce employee injures by 40%, resulting in a $5 million reduction in workers’ compensation claims.

• Illinois: In 1993, Peoria city officials and union leaders agreed to settle issues related to healthcare costs outside of bargaining. From this special partnership came savings of $1.2 million in the next budget year without needing to go to arbitration.

• Wisconsin: Managers in Madison worked with city building inspectors represented by AFSCME Local 60 to improve customer service and improve safety through an updated inspection process.

• California: The Los Angeles Bureau of Sanitation created a committee with the Service Employees International Union Local 47 that reduced overtime by 54% through a program that improved truck availability.

• Arizona: The Phoenix fire department worked with members of Firefighters Local 493 to create a problem-solving forum. From 1986 to 1996, the city and its firefighters did not need arbitration to resolve disputes. 

» Download the report here

U.S. Department of Labor, U.S. Secretary of Labor's Task Force on Excellence in State and Local Government Through Labor-Management Cooperation, May 1996