Posted on: Thursday, July 10, 2003

Lingle to seek caps on raises won by unions in arbitration

By Bruce Dunford
Associated Press

The Lingle administration will ask next year's Legislature to put a ceiling on pay increases awarded when public employee labor contracts are resolved through binding arbitration, state Chief Negotiator Ted Hong said yesterday.

"The governor values the use of arbitration, but is concerned there will be no way to determine what the resulting costs will be to the state," Hong said. "We'll suggest they put a ceiling on it," possibly tied to the Consumer Price Index.

On Tuesday, the Legislature overrode Gov. Linda Lingle's veto of a bill restoring binding arbitration to resolve labor disputes for 23,000 state and county white-collar workers.

The workers represented by six bargaining units of the Hawaii Government Employees Association were given the right to strike to settle contract disputes as a major provision in the 2000 Civil Service Reform Act, which was strongly opposed by the union. That has been reversed.

Those employees are covered by contract extensions that expire June 30, 2004.

Hong said unions covered by binding arbitration usually ask for twice as much as they want, because they know arbitrators will give them about half.

"We just had one union that asked for a 40 percent increase (in pay) and ended up getting 20 percent over four years," he said. "They knew they would get something in the middle, and they did."

Hong said caps on binding arbitration awards are common in collective bargaining in the private sector.

Senate Majority Leader Sen. Colleen Hanabusa, D-21st (Nanakuli, Makaha), a labor attorney, was the only Democrat joining the GOP to oppose the override.

Senate Labor Committee Chairman Sen. Brian Kanno, D-19th (Kapolei, Makakilo, Waikele), said binding arbitration "levels the playing field between the employer and labor unions."

Sen. Sen. Sam Slom, R-8th (Kahala, Hawai'i Kai), called binding arbitration "a win-win situation for public employee unions and a lose-lose situation for the taxpayers who ... wind up picking up the tab."