Nov 17, 2008 4:18 pm US/Central
Agreement Could Reduce City Budget Layoffs
CHICAGO (CBS) ―
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Mayor Richard M. Daley (File)
CBS
The City of Chicago may not be laying off as many workers as originally planned. Mayor Richard M. Daley's administration and several employee unions have found a way to save some of the 929 jobs that had been on the chopping block.
CBS 2's Mike Parker reports heads will still roll at City Hall, thanks to the economic crunch, but probably not so many. The unions have given up a little to get that assurance from the Daley administration.
The warning came weeks ago: 929 city employees would have to be laid off in order to plug up a more than $400 million deficit in the year to come.
The city's chief financial officer Monday stood alongside the heads of the major unions representing city workers to reveal the deal that's been cut.
"I think what's good by seeing all of us up here, is we understand that it's a problem that we face together," Chicago CFO Paul Volpe said.
"If organized labor was to stand up and say, 'we're not going to entertain this and we don't want to be part of it,' then our layoff numbers would be a heck of a lot larger than they are today," said Dennis Gannon of the Chicago Federation of Labor.
The city says 145 of those 929 threatened jobs will be saved, and that the number could go even higher. Unions have changed policy and agreed with Daley's plan for unpaid furlough/government shutdown days.
The unions also have agreed to voluntary retirement buyouts ranging from $5,000 to $15,000 for employees with long seniority. The city says that voluntary severance program will likely clear the decks for younger workers to come on board.
"People were going to be put out on the street and if people have the ability to retire, it will open up jobs to keep people working," said Lou Phillips of Laborers' Local 1001.
Before ordering the biggest job purge of his 20-year tenure, Daley shrank the city payroll by offering $12,000 to $20,000 in cash to non-union employees who agreed to retire voluntarily in August. It paid off to the tune of $8.3 million.
Records show that 156 people took advantage of the one-time offer, removing $10.9 million in salaries from the city payroll. The incentive payments averaged $16,000 and cost $2.6 million overall.
Phillips had urged the mayor to make the same offer to union members who comprise 80 percent of the city's workforce.
He predicted the cash incentive would induce an avalanche of retirements that would minimize the need to lay off 307 of his members, in part by shrinking the size of 80 more garbage collection crews — from two laborers on a truck to one.
Aldermen from across the city have raised questions about whether smaller crews could keep pace with garbage collection and bulk pickups in densely populated wards.
Earlier this month, Daley agreed to put the 929 layoffs tied to his 2009 budget on hold until Jan. 31 and reduce the overall number if there's a wave of year-end retirements.
"I think we all look at our 401k's and we see where they're going and the city's in the same situation," Gannon said.
For every 12 union employees who retire by Jan. 31 — and have notified the city by Nov. 14 — 11 jobs will be saved, Daley said.
CBS 2's Mike Parker and the STNG Wire contributed to this report.
(© MMIX, CBS Broadcasting Inc. All Rights Reserved.)
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