Last week’s quarterly state revenue forecast was largely flat, and that was bad news for the roughly two-thirds of state employees who have topped out in their job’s pay range. Despite a small improvement in state revenues, the increase is still too small to trigger a provision in two-year labor contracts that would have given 1 percent cost of living adjustments in pay for about 60,000 general government agency workers on July 1.
The outcome was not unexpected – and Gov. Jay Inslee had not accounted for the pay raises in the supplemental budget he first outlined last December.
But the lack of a general pay adjustment extends the pay-raise drought through the current biennium, which ends in June 2015. That’s a seven year span that includes a two-year period in which pay and hours worked were both reduced by 3 percent, and inflation during that time span has eaten into employees’ purchasing power.
“By the end of this biennium, state employees will have gone seven years without a general wage increase,” state budget director David Schumacher said in a news release last week. “We face a number of big challenges in the next biennium — in addition to finding new funding to meet our constitutional basic education obligation, Gov. Inslee has made it clear he intends to address a growing backlog of compensation issues.”
Schumacher also notified state agency leaders that the pay raises won’t be in the offing. In an email sent to state agency directors and budget directors on Wednesday, Schumacher said:
The state Economic and Revenue Forecast Council met today to adopt its new quarterly forecast, which shows a slight increase in General Fund collections over the previous forecast. Unfortunately, revenue collections have not grown enough over the past few years to trigger an automatic 1 percent pay increase for many state employees. Under the 2013–15 operating budget (Chapter 3, Laws of 2013, 2nd Special Session) and terms of the state’s current collective bargaining agreements with unions representing many state employees, salaries would have been increased by 1 percent if, as a result of increased economic activity, today’s forecast had been at least $200 million higher than what was forecast in September 2012. Revenue growth generated by economic changes has increased by only $11.7 million over that period.
Attached is OFM’s news release announcing today’s revenue forecast. Please feel free to share with your employees.
If it is any consolation, about a third of the general government workforce remains eligible for a step pay adjustment worth 2.5 percent to workers in their early years of government employment.
But union leaders were already expecting the worst. Executive director Greg Devereux of the Washington Federation of State Employees had said for months that he doubted revenues would be enough to trigger the 1 percent raises.
The conditional pay adjustments also were written into a number of higher education employee contracts.
Devereux said earlier this month that – based on Inslee’s ongoing efforts to adjust pay for agency heads – he thinks the governor is concerned about fair compensation for workers.
Devereux now wants Inslee, who won election in 2012 with strong support from organized labor, to show the same attention to rank-and-file state workers when negotiations on a 2015-17 contract begin in the summer.
“If we get to negotiations and he says there is no money, we’ll raise holy hell,’’ Devereux warned.