Unions Nix Job-Saving Plan

Imagine you've found out that your job was just eliminated by your employer — an experience Michigan residents have faced at an increasing rate in the last decade. Now imagine your co-workers, out of pure goodwill, decide to collectively take pay cuts so that you can keep your job and your employer can stay afloat. What a remarkable act of kindness this would be!

A group of employees in the Wyoming school district in West Michigan tried this very thing recently. Unfortunately for them (and the 57 employees who stand to lose their jobs), it looks like their plan will fall flat. The unions that exclusively represent these employees are working to nix the idea. Union leaders want instead to keep the pressure on Lansing for supposedly not adequately funding schools, and they have thus far only offered one possible solution to the district's spending problem: Squeeze out more cash from the district's fund balance.

Even if this group of generous employees in West Michigan were able to maneuver around union leadership, it's questionable whether or not their act of kindness would even be legal. Under the Wyoming teachers' collective bargaining agreement, only specific pre-tax payroll deductions are permitted. Deductions can fund contributions toward the cost of MESSA insurance, Michigan Education Association Financial Services, MEA dues and the MEA Political Action Committee. Permission is not granted, however, for deductions to go to the school district which could then be used to save some of the jobs the district needs to cut from its budget.

This is a great example of how collective bargaining agreements hinder school districts from finding creative ways to reduce their costs. Because these contracts lock in the costs of employee compensation, school districts are left with only a few options to deal with their overspending: lay off employees, cut programs or dip into their fund balances. An innovative remedy, albeit temporary and limited, like the one proposed in West Michigan doesn't even make its way to the table when employee contracts exclusively dictate compensation costs.

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