July 29, 2015
To the Honorable
Members of
The Illinois Senate,
99th General Assembly:
Today
I veto Senate Bill 1229 from the 99th General Assembly, which would amend the
Illinois Public Labor Relations Act to replace collective bargaining with
binding interest arbitration.
For
many months, I have advocated that local governments should have the right to
determine which subjects are collectively bargained with their public
employees. The response from some union officials is that my proposal would
“gut” the collective bargaining rights of those public employees. Those same
union officials proposed Senate Bill 1229, which goes far beyond my simple
proposal. It removes every subject of labor negotiations from the bargaining
process and allows unelected arbitrators to impose billions of dollars of new
costs on our taxpayers without any involvement of the Executive Branch, the
General Assembly, or those taxpayers. This legislation is undemocratic, it is
bad for our budget, and it is unconstitutional.
Senate
Bill 1229 is also based on a false premise that our Administration has been
unreasonable in labor negotiations and wants to lock-out employees or prompt an
employee strike. Nothing could be further from the truth. We have negotiated in
good faith with AFSCME since shortly after I took office. We came with our
proposals ready on day 1, and we made significant concessions from our initial
proposals, including revising our proposals on management rights, dues
collection, holidays, subcontracting, layoffs, and employee pensions. We asked
AFSCME to schedule more frequent weekly negotiating sessions (which they
declined), and we voluntarily agreed to extend negotiations even after the
current collective bargaining agreements expired on June 30, 2015. At my
request, those “tolling agreements” contain express provisions that prohibit a
strike or lock-out during our negotiations. Today our Administration signed a
new tolling agreement that extends negotiations until at least the end of
September. We are working diligently to reach an agreement with AFSCME.
Our
proposals have also not been unreasonable. In fact, the proposals we offered to
AFSCME are similar to those recently adopted by state employees represented by
the Teamsters. It took only two weeks from the time our Administration first
met with John Coli, the President of the Teamsters Joint Council 25, to reach
agreement with the Teamsters. The Teamsters, to their credit, were realistic
about the State’s dire financial condition. They cleared their calendars to
negotiate around the clock. They made no outrageous financial demands for large
pay increases or new health benefits. They had no problem agreeing to a 40-hour
work week. We similarly sought to build a strong partnership with the Teamsters
in exchange for their concessions. We agreed to a large monetary bonus pool to
reward employees for their exceptional performance. Rather than have an
unlimited subcontracting provision, we agreed to allow the Teamsters to bid on
any project offered to a private sector company and share in the savings
achieved by the State. We also agreed to fund an educational program for their
employees, a top priority for our Administration.
Given
time and reasonableness, we can reach a similar agreement with AFSCME. This
legislation, however, prevents our Administration from doing so. Many are
unfamiliar with the concept of interest arbitration that replaces collective
bargaining in this legislation. It is not the same as arbitration in civil law,
business, or other contract disputes. Interest arbitrators are not allowed to
fashion a compromise that Illinois taxpayers can actually afford. Presented
with the State’s and the unions’ proposals, arbitrators will be picking winners
and losers by accepting either side’s proposal in its entirety. Because
they are unelected and unaccountable, arbitrators can decide to impose on the
State the unions’ proposals without regard to the dire impact those proposals
will have on our fiscal stability. As I write this message, if AFSCME seeks to
impose its current proposal, it would cost our taxpayers an additional $1.6
billion in salary and pension costs and would eliminate $500 million per year
in healthcare savings that were part of the overall healthcare savings included
in both Democrat and Republican budgets. If an unaccountable arbitrator awards
AFSCME’s contract, the clear losers will be the State’s taxpayers. And the
already-difficult task of balancing the State’s budget in a constitutional
manner will become insurmountable, hurting the beneficiaries of State programs
and services that would no longer be possible. We cannot afford Senate Bill
1229.
Finally,
if enacted into law, Senate Bill 1229 would violate the United States
Constitution by retroactively impairing contractual obligations. In the last
round of negotiations, the State and unions entered into collective bargaining
agreements that spanned the period from July 1, 2012 to June 30, 2015.
Negotiating those contracts in 2012, both sides knew, and bargained with the
understanding, that any contractual obligations the parties undertake would
expire on June 30, 2015. Senate Bill 1229 changes that bargain by extending the
terms of expired agreements beyond June 30, 2015. The United States
Constitution forbids the State from enacting a law that changes contracts
retroactively. Senate Bill 1229 is therefore unconstitutional.
Senate
Bill 1229 would cede major financial decisions to unelected, unaccountable
arbitrators. This legislation is bad policy and would derail our efforts to
honestly balance the State’s budget and enact meaningful government reforms.
Therefore,
pursuant to Section 9(b) of Article IV of the Illinois Constitution of 1970, I
hereby return Senate Bill 1229 entitled “AN ACT concerning State government”,
with the foregoing objections, vetoed in its entirety.
Sincerely,
Bruce Rauner
GOVERNOR