HARRISBURG, Pa., Aug. 30, 2016 /PRNewswire-USNewswire/ --
Secretary of Administration Sharon
Minnich today announced details of a new
three-year labor agreement which is in the final stages of being
voted on by members of the American Federation of State, County and
Municipal Employees (AFSCME) Council 13 that will save
approximately $13.6 million in health
care costs.
In addition to the savings in the proposed contract, the
Pennsylvania Employees Benefit Trust Fund (PEBTF) has approved
further changes to active employee health care that will save
$59 million over the next three
years, strengthen the financial stability of the fund, preserve
high quality benefits for employees and mitigate increases in
employer contributions. The commonwealth also applied plan design
changes to the retiree population which also resulted in savings of
$121.2 million. The Retiree Employees
Health Program (REHP) currently provides health benefits to
approximately 64,000 retiree state employees and an additional
40,000 dependents. There are no increases to retiree
contributions.
The AFSCME agreement covers the majority of union-represented
employees under the Governor's jurisdiction. "The modest wage
increases in the proposed AFSCME agreement, coupled with greater
contributions for health benefits, represent a package that is fair
to employees and responsible to taxpayers, and I would like to
thank AFSCME for being a partner in these negotiations," said
Secretary of Administration Sharon
Minnich.
Key provisions of the AFSCME contract include:
- A 25% increase in the minimum employee health care contribution
from 2% to 2.5% of salary;
- A 7.25% increase in employee base pay over the life of the
three-year agreement.
- A reduction in the health benefit entitlement for those on
extended leaves without pay.
The increase in AFSCME employee health care contributions will
save approximately $13.6 million over
the life of the contract. Extending this savings to all employees
results in approximately $31 million
in savings. In addition, changes to the extended leave without pay
provisions in the AFSCME contract will save an additional
$3 million.
In accordance with Act 100 of 2016, signed into law by Governor
Wolf earlier this year, the administration has provided a copy of
the proposed collective bargaining agreement and required cost
analysis to the Independent Fiscal Office (IFO). This transmittal
details the costs and savings associated with the AFSCME contract
and other agreements collectively bargained under Act 195, as well
as savings achieved through collective bargaining and the PEBTF.
When combined, all savings associated with employee contributions
and health care plan design changes result in approximately
$214.2 million over the next 3
years.
3-Year
Savings
|
(amounts in
millions)
|
All
Funds
|
Collective
Bargaining
|
|
Employee contribution
change
|
($31.0)
|
AFSCME length of
benefit change
|
($3.0)
|
Total Collective
Bargaining
|
($34.0)
|
Health Plan Design
Changes
|
|
PEBTF Active Plan
Design
|
($59.0)
|
Retiree -
Non-Medicare Plan Design
|
($62.7)
|
Retiree - Medicare
Plan Design
|
($58.5)
|
Total Plan
Design
|
($180.2)
|
|
|
Total
|
($214.2)
|
3-Year
Costs
|
(amounts in
millions)
|
All
Funds
|
General
Fund
|
Collective
Bargaining
|
|
|
AFSCME wage &
employer benefits
|
$292.4
|
$96.9
|
Act 195
Pattern
|
$135.8
|
$59.8
|
Total
|
$428.2
|
$156.7
|
Negotiations with other unions whose contracts expired on
June 30th are
continuing.
Media contact: Dan
Egan (OA), 717-772-4237
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/secretary-of-administration-announces-proposed-agreement-with-afscme-council-13-and-first-major-health-plan-design-changes-in-over-12-years-through-both-pebtf-and-retiree-health-care-plan-changes-300320035.html
SOURCE Pennsylvania Office of Administration