Government workers get raises of up to 9 percent

By Gordon Y.K. Pang
Advertiser Capitol Bureau

More than 23,000 state and county white-collar workers would get raises of 5 percent to 9 percent, but will have to wait until next year, under an arbitration award announced yesterday.

Russell Okata, executive director of Hawai'i Government Employees Association, called the award "reasonable." Deborah Booker • The Honolulu Advertiser

The City and County of Honolulu would need to come up with $6.2 million to pay its share next year. It is unclear what the three other counties would have to pay.

The award calls for a 5 percent across-the-board raise beginning Jan. 1. In addition, most workers could move up one or more "steps," or pay grades, based on years of service, beginning July 1, 2004.

The possibility of "step movements" would mean that employees would end up with raises of up to 9 percent, HGEA Executive Director Russell Okata said.

The raises are subject to approval by the Legislature and the four county councils. Although it's not likely to happen, rejection by any of the five legislative bodies could negate the award, sending the parties back into litigation or to the bargaining table.

Senate Ways and Means Chairman Brian Taniguchi, D-10th (Manoa, McCully), said the HGEA increase appears manageable.

Union member Pat Tompkins, chief planner for elderly affairs in the city's Department of Community Service, said she had hoped for a contract that offered more, but was pleased that all employees will have the same vacation and sick leave benefits.

The panel decided to restore a benefits package giving all employees 21 vacation days and 21 sick leave days effective July 1.

Gov. Linda Lingle last week said she anticipated the award would be high and expected to urge lawmakers to reject it.

Lingle yesterday was in California on family business and could not be reached for comment. Members of her Cabinet said they were still studying the details of the 46-page decision.

The three-member arbitration panel was led by Sacramento-based professional arbitrator Catherine Harris.

The HGEA had sought an 8 percent increase over two years, including step movements. The state and counties proposed a 0 percent increase in the first year and a 1 percent hike in the second.

Last week, the state agreed to a six-year contract with the University of Hawai'i Professional Assembly giving its 3,150 members raises of 1 percent this fiscal year and 3 percent next year, which would cost the state about $10 million during the first two years. The final four years would add another 27 percent in pay increases.

Still looming are anticipated raises for the 13,200-member Hawai'i State Teachers Association and 8,300 members of the United Public Workers. The state recently began negotiating with the HSTA, while the UPW contract calls for new negotiations if HGEA workers get raises.

Okata said he and members would have preferred raises in the first year, noting that most members last year began paying anywhere from $10 to $300 more a month for health benefits.

"The one disappointing part of our award is that there will be no dollars paid for the first year of the contract," Okata said. "However, the contract basically protects the public employees we represent with a settlement that, we hope, both the Legislature and the respective county councils will find monies to fund."

The "back-loaded" agreement, with no raise the first year, should enable the state to pay for the raises in the second year, Okata said.

The state had said that finances would make it difficult to give HGEA members any raises during the two-year period.

The union, at one point, offered to settle for "nominal" pay raises less than that awarded by the arbitrator, Okata said.

"And this off-the-record position was not considered by the employers because they felt that they could not afford any monies effective July 1, 2003," he said.

Taniguchi, whose Ways and Means Committee is now deliberating the state budget, said the Legislature probably will be able to finance the HGEA raises.

"I think it's on the low side, and so if that's what it is, it's good news," he said.

He added that he would be "very surprised" if the administration called on lawmakers to reject the raises .

"I think she (Lingle) was just overly cautious," Taniguchi said.

With the governor out of town, the administration issued a brief written statement from budget director Georgina Kawamura and chief state negotiator Ted Hong shortly before 5 p.m.

"The Lingle-Aiona administration greatly values the contributions of our employees and we are committed to giving them the support they deserve," the release said. "However, while the arbitrator's decision was for this one particular bargaining unit, it is our responsibility to look at the overall impact this decision will have on our state economy and taxpayers."

The administration will "now need some significant time to digest" the decision, the release said, noting that the raises would carry a recurring annual cost of $53.4 million beginning in fiscal year 2005-06.

At Honolulu Hale, there was mixed reaction to the decision.

Mayor Jeremy Harris reiterated his position that the city cannot afford to pay the raises for 2,911 city employees covered by the contract.

"In my opinion, it's inappropriate to award public employee pay raises at a time when we are raising property tax rates on businesses," the mayor said.

Harris' proposed budget for the fiscal year that begins in July includes a 7 percent tax increase for commercial properties.

Council Budget Chairwoman Ann Kobayashi said Harris' proposed budget should have included money to cover raises, which were widely anticipated.

Kobayashi said the Honolulu council likely would approve the raises if the Neighbor Island councils did. She said she hoped to find ways to cut spending, rather than raise taxes, to cover the cost.

But Councilman Charles Djou said approving the pay raise "will trigger either a massive tax increase that will dwarf Harris' enormous 2003 tax hikes or major systemwide layoffs."

Advertiser staff writers Johnny Brannon and Lynda Arakawa contributed to this report. Reach Gordon Y.K. Pang at gpang@honoluluadvertiser.com or 525-8070.