City Council members, County Commissioners Need to Scale Down Employee Benefits

I have been clicking around on the city and county websites to learn more about fringe benefits offered to local governmental employees.

In the past, civil service employees were granted very generous benefit packages because the assumption was that their earning potential would be less than that for employees in the private sector.  However, that is no longer true.  Now governmental employees tend to do better than private sector employees.  Under the system of Eurosocialism introduced by Obama, public sector workers are the new aristocracy.

There is now enormous fiscal pressure on both the city and the county.  Both the city and the county need to reevaluate the lavish benefit packages afforded local governmental employees.

The city's benefit package is described here.  The county's is described here.

Here are several things that jump out at me:

1. Both the city and the county allow 12 paid sick days per year.  This is incredibly wasteful, and likely has few parallels in the private sector.  Both the city and the county need to rid themselves of this benefit, and adopt a Paid Annual Leave (PAL) system that is inclusive of both vacation and sick leave.  If the employee lays out sick, it should come from the same pot as his vacation time.  No additional time should be allotted under the assumption that employees are going to take sick days. 

2. Vacation benefits are extravagant. Both the city and county start at two weeks per year (or more), and increase with tenure to nearly five weeks per year.  Again, I am not sure the private sector is typically offering this level of benefit, but even if it did, it is too much.  Paid Annual Leave (PAL) should start at one week per year, and increase over time to three weeks annually, max.

3. Medical benefits typically are excessive and extremely expensive.  United Healthcare (UHC) is the insurer for both the city and the county.  Employees often have gold-plated health care plans with little or no copayment or deductible.  Both the city and county should shop and get quotes from other insurers; and should not give UHC preferential treatment because it has operations in Greensboro.  Moreover, both the county and city should increase deductibles dramatically and adopt consumer-driven plans.  It is not clear to what extent dependent coverage is subsidized by taxpayers; but employees should be responsible for the entire cost of dependent coverage, as they often are in the private sector.

4. Vision and dental insurance should be scrapped.  People can pay out of pocket for these services.

5. Life insurance should not be subsidized except perhaps for a minimal amount that would cover funeral expenses.  The city offers life insurance covering two times the amount of annual salary.

6. Retirement benefits are an absolute racket.  Both the city and the county offer their employees a total of three retirement plans (in addition to Social Security).  Each fund two types of plans.  This is excessive.  Funding one plan should be more than enough for our local governments to offer.  In addition, we should cut back dramatically on the number of employees who are able to retire prior to age 65.  It has been a tradition in many civil service settings to allow folks to retire after a given number of years of service.  Instead, folks should be required to work until they are eligible for Social Security before drawing their retirement.  (Exceptions could perhaps be made for public safety workers, who cannot necessarily be expected to be able to do their jobs to that age.)  The gravy train of governmental retirement benefits needs to be stopped in its tracks. 

7. There are too many paid holidays.  The city and county offer in the range of 10-11 paid holidays per year.  That should be reduced to 7-8, max.

When City Council members and County Commissioners wrestle with their respective budgets, they need to consider the prodigious costs associated with employee benefits.  Human resources-related expenses are typically a huge component of the costs any organization faces.  We have not even begun to discuss the matter of wages and salaries.  But benefits, and paid leave of various types, are very expensive to taxpayers. 

Our elected officials should be expected to manage these benefits with good stewardship.  They should not defer these decisions to HR people or to other staff who might feel inclined to make employee benefits quite generous. 

There will be attempts to represent that we are offering a "competitive" benefit package; but those of us who have been in the private sector know that is not true.   There will be attempts to suggest that the city and/or county will lose workers if we cut benefits.  But I truly doubt that is an issue, particularly in the new economy. 

Comments

[Brenda Bowers]

The only way this will happen is if the Congress steps up and makes it illegal to unionize all federally employed workers. then the states and cities have a leg up and can move in the same direction. Alone each city and state can be held hostage by their unionized workers as was seen by the actions of the New York City unionized workers this week. BB

[Joe Guarino]

Brenda, our city and county employees enjoy these lavish benefit packages WITHOUT collective bargaining. Yes, we have some "unions', but they can't strike or negotiate collectively. And yet, they have still been granted extremely generous benefits by city and county leadership.

[Will Tax For Food]

The problems you cite will only be solved when politicians and government workers can be found on street corners holding signs that read, "Will Tax For Food."

Anything else prolongs the inevitable...

[JC]

Joe, some of your points are state controlled.

[Joe Guarino]

JC, we need to know which paid benefits are absolutely mandated by the state, and which are flexible for the city and county. If the county and city have flexibility on any given item, they need to maximally take advantage of that flexibility to compensate for any benefits mandated by the state.

[Steve Harrison]

Joe, do you have any idea of when the City/County adopted these benefits? Just trying to figure out if Obama's Eurosocialist influence over municipal governments predates his election to the Presidency...

[Joe Guarino]

Steve, the introduction of more socialism, and the economic malaise that accompanies it, drags many non-governmental workers and entrepreneurs downward. That is why governmental workers suddenly occupy a privileged position.

When I visited Italy several years ago, I was told that the high-prestige occupations were governmental workers, professors (who also tend to be government employed) and physicians. There was high unemployment there, even before the financial crisis, and less opportunity overall than in the US.

[Steve Harrison]

Just bustin' yer chops a tad, Doc. Since you're a hard sciences guy and not a (Liberal) Arts product like me, I'll give you a little refresher: The connection between a thesis statement and the elements proving such must be strong or they will both fall apart under scrutiny.

[bubba]

"The connection between a thesis statement and the elements proving such must be strong or they will both fall apart under scrutiny."

....except in the case of global warming....excuse me, "climate change", in which case deception, lies, no proof whatsoever, and outright fraud are acceptable.

[Bubbasbias]

Bubba changed the subject. LOL

[bubba]

"Bubba changed the subject."

Somebody had to point that out to you, didn't they?

Or are you just another lame brain Cone blog reader?

[Mick]

Joe, You didnt really answer the question. I dont necessarily disagree with all of your points and info or your general premis for that matter. But this appears to have started long before Obama entered the national picture. Doesnt make it right or wrong. However, invoking "Obama" lessens your argument if indeed most if not all of your points are "pre-Obama". Also, I'm not sure how much control the City/County has or had over the paid holidays with the possible exception of MLK birthday.

Bubba, that was quite a jump!

[Joe Guarino]

Mick, it doesn't matter when the city and county adopted the benefits. The national landscape is now such that Eurosocialism is our likely future. This means that the future prospects of many people will be much lower than they otherwise would have been. And it means that the relative position of governmental workers becomes much higher.

For each of the points I made, an analysis would have to be made as to how much control the city and county actually have. I may be wrong, but I don't think anyone compels them to have a paid holiday. In some cases, the holiday may be required, but that doesn't necessarily mean it must be paid. If anyone has information to the contrary, please let me know.

[Mick]

It does matter when you say this... "Under the system of Eurosocialism introduced by Obama, public sector workers are the new aristocracy". It makes it seem very much like you are tying the two together when in fact the bene's existed long before Obama.

Are you actually advocating unpaid holidays for govt employees? Seems a bit harsh. Also, I would think there are better places to go than forced, unpaid days off for savings. Do your employees have vision and/or dental? We had to add vision on to my wifes insurance but limited dental is included (with a co-pay). Where do you get your info that "employees often have gold plated ..." Seems ambiguous and rather hyperbolic. Though perhaps in some instances your opinion there may not be too far from the truth! Getting quotes and shopping around seems to make sense going forward. Agreed on sick days particularly if public employees pay is similar with private. Under any circumstance 12 seems like a huge amount of sick days! The life insurance stuff is certainly debatable particularly as to amount of allowable coverage. I do wonder how much City/County pays as compared to employee though?

The overall point of there could be savings is certainly legit. Many public sector workers indeed make as much or more as private sector these days. There is room for work no doubt.

[Joe Guarino]

My employees do not have vision or dental coverage through my office. I have worked directly with the Guilford County and city of Greensboro employees who present to my office for treatment, so I am somewhat familiar with the insurance they have. I don't think it seems unreasonable to expect that paid holidays be similar to what is offered in the private sector.

But you are right that there are savings to be had; and the point is that our elected officials need to start talking about it-- and perhaps start showing a bit of spine.

[Mick]

How differant are those paid holidays from the big corporate/private sector holiday calendar? I am my own boss so I am ignorant of the typical corporate holiday schedule.

[padem]

None of those benefits would be out of place in medium to large size corporations. In my specific instance, the only significant differences are that I don't have a defined number of sick days and that I get 12 days of vacation a year. (And you really should look into dental and vision coverage for your employees.)

[Joe Guarino]

Padem, I don't doubt that some medium to large corporations offer many of these benefits. I doubt that the majority offer the same level of vacation, sick time and retirement. And I doubt many get as many paid holidays as you do. But it would be good to see definitive data.

Many medium to large corporations are going to more austere, consumer driven health plans, especially if they are not bound by union contracts.

[Mick]

Called a buddy of mine who has been Corporate for a long time. 6 weeks vacation, only one of which "carries over" to the next year. No such thing as sick days. 6-8 paid holidays days. Insurance is good but he works for an insurance company so.....

It does seem to appear it is time for an audit of salaries and particularly benefits for city/county employees.

[Joe Guarino]

Part of this has to do with corporate culture and tradition, I'm sure. They may be generous with some things, not so generous with others. And of course, people are at risk of losing their jobs at all times typically, with no civil service protections.

But the city and county are exceedingly generous with benefits in most all respects.

[Steve Harrison]

"it would be good to see definitive data."

BoL gathers and develops some pretty good data, but (unfortunately) their information is often dated by the time it's released. So if you want timely, regional comparisons of pay & benefits, you gotta pay for it, and it ain't cheap.

Evaluations such as you're suggesting are a good idea, if they're part of a long-term plan. But making frequent modifications (good or bad) to employee benefit packages, based on fluctuations in the local labor market, can produce an uncertainty in the ranks that can devastate your ability to function efficiently and properly.

Yes, taxpayers are paying for these services. But they are also "clients", if you will, who will feel the impact of the loss of experience that results from a major turnover in the public sector workforce.

[Joe Guarino]

Steve, you are right. I don't think anyone is suggesting "frequent modifications". I think we are suggesting that our elected officials take another look, and make some adjustments based on a considerably changed long-term economic picture. And the paucity of jobs locally-- a condition not likely to change in the foreseeable future-- suggests to me we would not be losing many public sector employees if we adjusted benefits; but for those we did lose, there would be many willing replacements.