What’s this all about?
The IBEW 1245 labor agreements (contracts) with Pacific Gas & Electric expire on Dec. 31, 2014. These include the Physical Agreement, the Clerical Agreement, and the Benefits Agreement. In March, IBEW members began submitting proposals to revise these contracts during General Bargaining, which would begin after Labor Day. Toward the end of March, with unanimous support of IBEW 1245’s negotiating committee, the union proposed an extension of all three agreements for one year, through 2015, and to give an across-the-board wage increase of 2.75% on January 1, 2015, to all Physical and Clerical employees in the IBEW bargaining unit. On April 1, the company agreed to our proposal.
Does the union have a position on this offer?
The IBEW 1245 Bargaining Committee, including Business Manager Tom Dalzell, has unanimously endorsed this offer. So the company’s offer is now considered a Tentative Agreement.
Do I have to do anything?
Any tentative agreement, even if it is just a decision to extend the current agreements, must be ratified by the members. On April 18, 2014, a “mail ballot” will be sent to all current Physical and Clerical members. You should follow the instructions for completing your ballot and then return the completed ballot in the envelope that is provided. Ballots will be counted at Weakley Hall in Vacaville, CA on May 16, 2014. Ballots arriving after counting has begun will not be counted.
Why does the IBEW 1245 Bargaining Committee favor extending the agreements rather than going into full-scale general bargaining?
Timing is important in collective bargaining. Right now we face a toxic bargaining environment at PG&E, largely due to the San Bruno disaster of 2010. Since then the company has spent some $2.7 billion in making improvements—costs that cannot be passed onto the ratepayers. Additionally, the California Public Utilities Commission is expected to impose fines on PG&E that could go as high as $4 billion. After the company offered to extend our labor agreements, it was announced that PG&E will also face criminal indictments in connection with the San Bruno disaster.
But if PG&E is in such a weakened condition, doesn’t that put the union in a stronger bargaining position?
It might seem that way. But in reality, collective bargaining is about getting a company to put money on the table. When a company can show that it is under severe financial pressure, negotiations tend to focus on “take-aways”—things the company wants employees to give up to help the company get back on its feet. The IBEW 1245 bargaining committee believes it is not realistic to expect the company to put more than 2.75% on the table. In fact, if this wage increase is rejected, it is possible the company would come back to the table with a lower offer, not a higher one.
Is the company allowed to do that?
Normally the law does not allow companies to lower an offer they’ve already made. But it’s possible that PG&E could get away with it by claiming that its financial situation has changed. The criminal indictments were announced after the offer was made.
Are Hiring Hall members eligible to receive the 2.75% wage hike?
Yes. And Hiring Hall members will be eligible to vote on the wage hike.
Does the 2.75% wage hike measure up to our historical standard?
IBEW 1245 wage increases at PG&E have consistently exceeded inflation, and this wage increase continues that positive trend. Over the last 10 years, IBEW 1245 Clerical members have seen their wages rise at nearly twice the rate of inflation. For Physical members, that figure is even higher, due to special CDL and 2-man rubber-gloving premiums that were added in recent years. Over that same 10-year period, 70% of workers nationwide have seen their wages stagnate or decline. The inflation rate in 2013 was just 1.4%. So far in 2014 inflation is running at only 1%, and shows little sign of heating up. The 2.75% increase means that IBEW 1245 members will continue out-running inflation by a significant amount.
Does the extension make any other changes to the agreements, other than the wage hike?
We know that certain parts of the Benefits Agreement pertaining to Hiring Hall employees are not in compliance with the federal Affordable Care Act (Obamacare). The company and union will have to find a way to bring these provisions into compliance with the law. These changes will apply primarily to Hiring Hall employees. Fortunately, it appears that any such changes will have to be positive in order to bring the company into compliance with the law. These ACA-related changes are the only changes that would be permitted under the terms of the extension.
What exactly will I be voting on?
Physical members will vote on two issues: extending the Physical Agreement, with the 2.75% wage increase, and the changes needed to bring the medical plan into compliance with the law.
Clerical members will also vote on two issues: extending the Clerical Agreement, with the 2.75% wage increase, and the changes needed to bring the medical plan into compliance with the law.
Hiring Hall Physical members will vote only on the extension of the Physical Agreement, with the 2.75% wage increase. Hiring Hall Clerical members will vote only on the extension of the Clerical Agreement, with the 2.75% wage increase.
How can I found out more about this contract extension?
IBEW 1245 wants members to make an informed decision. If you have further questions, you can submit a question and we will publish an answer in this Q&A on the union website as soon as we can. Union stewards with special training on the contract extension will be visiting various headquarters from April 9-16, speaking with members on breaks and at lunch. Business Manager Tom Dalzell has sent all PG&E stewards a letter explaining the contract extension, and all PG&E members will receive a brief explanation by direct mail. Tom Dalzell will host two live call-in phone conferences to answer member questions, and will also appear in two web videos to explain the contract extension. Your IBEW 1245 business representative is available by phone to help—just go to the Ask Your Rep link at www.ibew1245.com.
QUESTIONS SUBMITTED BY MEMBERS:
These questions are for the Physical. What’s the total number of hiring hall getting ballots? What’s the total number PG&E getting ballots?
The approximate number of ballots being sent are as follows:
Regular Physical: 8610
HH Physical: 330
How many clerical ballots?
There are about 2400 Clerical ballots and just over 200 Hiring Hall Clerical ballots.
What’s to stop PG&E from letting the medical insurance we have now go and getting the basic insurance, whatever is up to Obamacare standards? They’d love to give us a raise and then ditch the good insurance and only comply by the “law”, or ACA.
Our medical benefit is a product of negotiations. It cannot be unilaterally changed by the company. Changes must be negotiated with the union, and approved by a majority vote of the members. That is the power of a legally-binding labor agreement. It is anticipated that PG&E will have to make some improvements to its medical benefit—mainly affecting Hiring Hall employees—to bring the company into compliance with the Affordable Care Act (Obamacare). There is no opportunity in this contract extension process for the company to take benefits away.
The BLS just reported on 4-15-2014 that inflation is at 1.5%. Shouldn’t we be asking for at least double the inflation, which would be 3%?
The BLS publishes two inflation rates: one for urban wage earners and one for urban consumers. The rate in March for urban wage earners was 1.4%. The report you heard probably was referring to the March figure for urban consumers, which was 1.5%. These two figures tend to be nearly the same, and to go up and down together. (The IBEW 1245 website always reports the wage earner figure, just to be consistent.) The wage earner inflation rate was 1.4% in March, 1% in February, and 1.6% in January. For all of last year, the rate was 1.4%. But the real point is this: 2.75% is the amount on the table, and it’s considerably more than inflation. The bargaining committee thinks it would be wise, in the current climate, to take that money while we can.
Union says it’s a “toxic economic climate” for general bargaining right now. If, in a worst case scenario, PG&E is hit with fines & penalties up to $4 billion this year by the PUC stemming from San Bruno, what is to prevent PG&E from using that when negotiations take place in 2015, and say they don’t have the financial means for benefit improvements and wage increases as a result of the fines and penalties? Couldn’t the “toxic climate” be even worse next year?
Good question. We expect PG&E to weather the coming fine and then start getting back on its feet financially. What makes the climate for bargaining “toxic” right now is the uncertainty about the fine and the criminal indictment. We want the company to be able to focus its attention and resources on general bargaining. We think there’s a better chance of achieving that next year.
If a one year extension is a good option, would a two year extension be a better option?
What will be voted on in coming weeks is a one-year extension of all three agreements, with an across the board wage increase of 2.75%. This gives us the flexibility to get back into general negotiations next year. At that time we could consider proposing another one-year extension, if that seemed like the best option. But right now we think that one year will be long enough.
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