Statement by Eugene J. Keilin

Chairman of the Citizens Budget Commission

On the Expiration of New York City's

Largest Labor Agreement

March 30, 2000

At midnight tomorrow the contracts between the City of New York and 56 unions, which bargain together through District Council 37 of the American Federation of State, County and Municipal Employees, will expire. Effective April 1, 2000, about 125,000 municipal employees, the largest single collective bargaining group, will be working without a new contract.

This is just the first of multiple contracts that expire in the coming months. The ending dates of the major union contracts are:

Uniformed Sanitationmen's Association - May 22, 2000

Uniformed Firefighters Association - May 31, 2000

Patrolmen's Benevolent Association - July 31, 2000

Correction Officer's Benevolent Association - July 31, 2000

United Federation of Teachers - November 15, 2000

The prospect of municipal employees working without a new contract is discouraging for two reasons. First, workers who deserve raises will not receive them in a timely way. This leaves them working amidst economic uncert ainty and does not foster a productive work environment.

Second, from the citizens' vantage point, we are deprived of the benefits of new work rules that promote productivity and of the benefits of merit pay principles that can be implemented only through collective bargaining. Mayor Rudolph W. Giuliani committed to such productivity initiatives and to merit pay as a basis for future raises in his January Preliminary Financial Plan. The Citizens Budget Commission (CBC) has long advocated these management goals in collective bargaining and enthusiastically supports the Mayor's recent commitment to them.

While workers can be given their raises retroactively, it is very difficult, if not impossible, for service improvements and lower unit costs to be achieved retroactively. Citizens, therefore, have at least as big a stake as municipal employees in timely labor settlements.

The CBC urges Mayor Giuliani and the municipal labor leaders to give their full energy and attention to reaching timely agreements. In December 1999, as the expiration of the Transit Workers\rquote Union's contract with the Metropolitan Transportation Authority approached, Mayor Giuliani strongly and correctly chided the parties for not beginning serious negotiations earlier and for n ot bargaining around the clock as the deadline neared. The same advice applies to municipal labor negotiations. It is not responsible to let contracts lapse without serious bargaining.

The Citizens Budget Commission is a nonpartisan, nonprofit civic organization that has been monitoring the finances and operations of New York City government since 1932.

###