Older Cohort Means Not Many Utilizing It While All Make Givebacks
Paid Parental Leave A Big City Money-Saver At Managers’ Expense
· By RICHARD STEIER
· Sep 25, 2017 Updated 16 hrs ago
STU EBER: Parental-leave package no bundle of joy.
ROBERT W. LINN: Too early to make revisions.
RONNIE LOWENSTEIN: A clear savings to city so far.
An analysis by the city’s Independent Budget Office of the early stages of Mayor de Blasio’s paid-parental-leave program found that relatively low usage by managerial employees gave the city a net savings of $5.8 million because of givebacks in salary all managers were required to make and vacation days more-senior ones relinquished in return for the benefit.
Stuart Eber, the president of the Managerial Employees Association, said the IBO study “affirms our contention that the city is overcharging the managers for Paid Parental Leave. PPL remains a great benefit with a defective payment methodology.”
Unions Haven’t Taken Bait
City Hall had hoped to extend the program to the entire workforce, but municipal unions refused to take the plunge because they said the tradeoffs sought by the de Blasio administration were onerous. By law, city managers are prohibited from joining unions; the MEA is an advocacy group on their behalf but lacks formal collective-bargaining rights.
In January 2016, the Mayor announced the program, under which employees can take six weeks of parental leave at full pay. To offset the anticipated cost, it required managers to forgo a scheduled raise of .47 percent and those with at least 15 years’ service to give up two annual vacation days.
Based on the results for fiscal year 2017, which ended June 30, Mr. Eber said in a Sept. 20 phone interview, “They no longer need to be taking the two days, and even the .47 is too much.”
Labor Commissioner Robert W. Linn countered that it was too soon to reach any conclusions, pointing out that the scheduled wage increase did not to take effect until July 1, the day after the period examined by the IBO. He said in a Sept. 22 interview that to this point the city has spent $5.8 million on the program, which exactly matched the savings.
“Going forward, we’re not yet in a mature situation,” he said. “We plan at the end of this fiscal year to see where we are,” adding that it would not be until after next June 30 that a determination would be made as to whether “the rate should be adjusted.”
One District Council 37 source noted that Executive Director Henry Garrido previously had said the city’s asking price for the benefit was too high.
New Structure for Unions?
Mr. Linn said, “We are going to have conversations with each of the unions. I don’t know whether we’ll be using the same structure with them.”
There are variables that would figure to produce different results for unionized workers compared to managers. Few employees come into the municipal workforce in managerial positions, and those who are promoted often have at least five years on the job before gaining managerial status. The managers losing the two vacation days are on the extreme end of the spectrum, even though more than a few city managers have twice as much service time: the loss of the two vacation days drops them from 27 annually back to the 25-day norm for less-senior managers.
The IBO took note of the greater seniority tending to skew usage of the parental-leave benefit. Among the 230 managers who had taken advantage of the program during fiscal 2017, their median age was 37. The median age of 8,279 eligible employees who were examined by the IBO was 47, and for those with at least 15 years’ service who had to give up the two vacation days, it was 55.
“The report clearly shows that the older managers are losing annual leave for a benefit that is being used by the youngest employees,” Mr. Eber said.
Unionized Overtime Cost
The fact that non-managerial employees would tend to be younger and more likely as a result to value the opportunity to use the paid-parental-leave benefit, as well as the fact that, unlike managers, they are eligible for overtime pay, could actually lead city officials to take a tougher stance with their unions even though no deal could be unilaterally imposed on those workers. Mr. Eber explained that city officials “would say they’d have to be paying overtime for people replacing those who are using the benefit,” where managers continue to be paid straight time regardless of the number of hours they work in a day or a week.
While it is expected that Mr. Eber and Mr. Linn will have further informal conversations on the issue, the MEA head said he was unwilling to wait until next summer for a decision on whether the concessions should be reduced. He said the group would look to speak to Mr. de Blasio himself and Ciy Comptroller Scott Stringer, as well as “covered” agencies including the Department of Education, NYC Health + Hospitals and the Housing Authority, to seek a swift recalculation of the givebacks necessary to offset the cost of the leave benefit.
IBO Director Ronnie Lowenstein said in a letter to Mr. Eber that her office estimated that the savings to the city of not paying the .47-percent raise would be $4.4 million in the current fiscal year, and that the city would save another $1.3 million in related costs “through reduced pension obligations, FICA and MTA payroll taxes, and other employee benefits. Savings from eliminating two days of paid vacation is an estimated $2.5 million annually.”