- Associated Press - Tuesday, March 25, 2014

JUNEAU, Alaska (AP) - As the state continues to negotiate contracts with unions for ferry system workers, a Senate committee on Tuesday advanced a bill that would lower pay for the system’s Alaska-based employees by eliminating cost-of-living differentials.

A provision that dates back decades allows differentials to be paid to employees living in Alaska, as opposed to those living out of state, with the minimum salary based on Seattle’s cost of living. The Alaska Marine Highway System spans more than 3,500 miles, from Bellingham, Wash., to Dutch Harbor, Alaska, and employs workers who live outside Alaska.

Information provided with the bill shows the differential is about $450 to $665 per pay period for two of the unions and roughly $4 to $5 an hour for another union.

Union leaders say getting rid of the differential will hurt recruitment. Some ferry system workers who testified to the Finance Committee talked about the long work hours and the high cost of living in rural communities.

Sen. Fred Dyson, R-Eagle River, the sponsor of the bill, has said the differential results in significant costs to the state.

Senate Bill 182 would not allow collective bargaining agreements to adjust the salary paid to an employee living in Alaska based on a difference between the cost of living in Alaska and outside the state. If approved, the bill would remove the cost-of-living adjustment for anyone hired after July 1. Employees already receiving the benefit before July 1 will continue to be paid the differential.

Nicki Neal, director of the Division of Personnel and Labor Relations, told the Finance Committee on Monday that the differential language in law is outdated and limits what can be bargained.

Critics say the state should not get involved in union bargaining issues.

The state remains in negotiations with three unions representing Alaska Marine Highway System workers. State law calls for terms of tentative agreements to be submitted to the Legislature by the 60th day of session. The 60th day happened last week.

Kate Sheehan, deputy director of the personnel division, said that if an agreement isn’t reached by June 30, when the current contracts expire, existing terms do not necessarily roll over. She said by email that similar situations have been handled in different ways in the past.

Ricky Deising, regional director with the InlandBoatmen’s Union of the Pacific, said the union has been negotiating in good faith and felt “submarined” by the bill. He said the bill will hurt recruitment of Alaska workers. He said he doesn’t support the two-tier system the bill would set up, in which new hires would not get the differential.

According to the Department of Administration, Juneau and Ketchikan have the highest number of marine unit employees in Alaska, at 212 and 200, respectively. But employees also live in places like Metlakatla, Ward Cove and Kasilof, as well as Eagle River and Anchorage.

A fiscal note attached to the original bill, which would have eliminated the differential completely, indicated a potential cost savings of about $7.7 million for next year.

The fiscal note for the revised bill, which was advanced Tuesday, cited possible savings to the state of up to $850,000 a year but cautioned that the figure was a rough estimate and that the fiscal impact could not be accurately determined at this point.



SB182: https://bit.ly/1pxNqBU



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