WSLC 2005 Legislative Report

TABLE OF CONTENTS

Unemployment benefits: Compromise "stops the bleeding"
Health Care Responsibility Act killed
President's Column: We are investing in Washington
Transportation investment:
9.5 cents for our families' safety
Retro reform: GOP kills efforts to rein in workers' comp program
Apprenticeship utilization rules made permanent
Paid family leave insurance passes Senate, but dies in House

This is an abbreviated version of the 2005 WSLC Legislative Report. Order a printed copy for the complete version, which includes stories on offshore outsourcing, election and campaign reform, gay civil rights, agency performance audits, workers' compensation, mental health parity, prescription drugs, health care disclosure, and much much more.

2005 WSLC LEGISLATIVE REPORT
CONTRACTS FUNDED
State employees finally get raises
with historic first agreements

They teach our children, treat our injuries, protect our homes and property, build and repair our roads, maintain our parks, protect our environment, care for our elderly and disabled, and provide many other vital services. And for four years, Washington’s state employees have gone without cost-of-living pay raises and have had to absorb much higher medical costs to help balance the state budget. They and their families have made significant sacrifices to shoulder this burden for all of us.

In 2005, it was time to recognize those sacrifices and reward them for their service.

State employees finally gained the right to full collective bargaining in 2002. Last year, historic first master contracts -- comprehensive agreements on employee working conditions, pay and benefits -- were negotiated with the governor’s office and college/university presidents.

But it was up to the 2005 Legislature to approve and fund the contracts in the next biennial operating budget. Despite another tough budget year, they did just that (see Senate Vote #15, House Vote #15).

Those contracts grant long-overdue pay increases of 3.2% this July and 1.6% next July, pay gap adjustments and stabilize health insurance premium rates at the current level of 12% for represented employees. Non-represented state employees will have to wait until September 1 of each year to receive their COLA, and could face higher out-of-pocket health costs as well. The two-year operating budget also trimmed 1,000 Washington Management Service and other mid-level positions, freeing up funds for frontline services, and saved Fircrest School’s residential services for persons with developmental disabilities.

The budget advanced home care services for the elderly and disabled by honoring the state’s contract with individual provider home care workers, providing wage parity for private agency workers, and rejecting client eligibility cuts. But unfortunately, last-minute language was inserted to cut health care benefits for many home care workers at private agencies.

Though not perfect, this budget was very positive for working families, funding health care coverage for tens of thousands of children in low-income families and restoring some other onerous health care cuts passed in recent years. It was accomplished without raising property, sales and business taxes. It did, however, raise taxes on cigarettes and liquor, and reinstate a portion of the estate tax.

In the face of many Republican leaders’ sky-is-falling rhetoric about the state’s business climate, Democrats took a strong stand in 2005 to patch the safety net for laid-off workers. In doing so, they also committed to finding a long-term solution that’s fair both to employers and to workers who lose their jobs through no fault of their own.

EHB 2255 enacts two temporary changes to return Washington to the national mainstream on Unemployment Insurance benefits, but leaves intact most of the changes from the 2003 business-backed UI overhaul. One, it restores the "liberal construction" language -- meaning, in gray-area cases, the worker gets the benefit of the doubt, as they do in 43 other states. Two, it restores two-quarter averaging for calculating benefits, but at a slightly lower multiplier than before. Only seven states use the most-punitive four-quarter formula imposed in Washington beginning this year. These changes sunset in two years, during which time a task force will study and recommend permanent UI changes that are fair both to employers and workers.

Prime sponsored by Rep. Steve Conway (D-Tacoma), EHB 2255 passed the House 56-41 (Vote #8) and the Senate 25-20 (Vote #9), and was quickly signed into law by Gov. Christine Gregoire. The bill was supported not only by all of organized labor, but also by The Boeing Co., the food processing industry and some other agriculture interests, thanks to a provision providing temporary UI premium cuts for drought-affected industries.

"This is an important victory for working families that stops the bleeding for unemployed workers," said Rick Bender, President of the Washington State Labor Council. "For many Washington workers who lose their jobs, this will mean being able to keep their cars, their homes, and even their families together."

In the final hours of the 2003 session, legislators approved a UI overhaul, without a public hearing, as part of the incentive package to win assembly work for the Boeing 787. EHB 2255 restores the two above-mentioned benefit cuts, while leaving intact most of 2003’s changes, including:

Despite the fact that EHB 2255 changes were relatively modest, and temporary, Republican leaders decried the bill as "gutting" of the 2003 UI overhaul. They accused Democrats of chasing away employers with "business unfriendly" legislation and tried to play working people against each other by suggesting that construction, agricultural and other intermittent workers most harmed by 2003 benefit cuts didn’t deserve the level of benefits they have received for decades.

But with strong leadership from House Speaker Frank Chopp, Senate Majority Leader Lisa Brown, labor committee chairs Rep. Steve Conway (D-Tacoma) and Sen. Jeanne Kohl-Welles (D-Seattle), Democrats took a principled stand on EHB 2255. They argued that it’s revenue neutral for the UI Trust Fund, temporary, and most importantly, the right thing to do.

Under the new law, a UI task force will be established, including four business and four labor representatives, and the chairs and ranking minority members of the Senate and House labor committees. It will review the UI system, including whether the benefit structure is equitable, whether it fairly accounts for changes in workforce and industry work patterns including seasonality and claimant work patterns, whether the tax structure equitably distributes taxes, and whether the trust fund is adequate in the long term. It must report to the legislature by Jan. 1, 2006.

"We look forward to working together in this task force to find a solution that’s fair both to workers and employers," said Bender.

There is no question that rising health care costs are the single biggest drag on the American economy. But with health care reform so far down the Republican-controlled federal government’s to-do list, the hopes of Washington’s working families rest with state lawmakers to address the crisis, to the extent they can.

A centerpiece bill in that effort, the 2005 Health Care Responsibility Act (SB 5637 and HB 1702), would have required employers of 50 or more, along with their employees, to take responsibility for funding basic affordable health insurance for employees. Employers would have a choice: purchase 80 percent of the cost of basic coverage for their employees or pay a fee to help expand public insurance programs for the uninsured.

Although the HCRA received positive House and Senate hearings and considerable press attention, neither were voted upon on the floor.

A statewide poll found 83 percent of likely voters agree -- 67 percent strongly -- that large businesses should be held accountable to minimum public standards, like paying a fair share of the cost of employee health benefits.

The HCRA was supported by labor, religious and community organizations, and by a handful of business owners who provide health benefits but are struggling to compete with companies whose employees must rely on taxpayer-subsidized health care.

Craig Cole, president of Brown & Cole Stores, a supermarket chain that employs nearly 2,000 in Washington, testified that by subsidizing his competitors, the state leaves businesses like his to "feel like chumps for covering their employees."

The WSLC and its allies will continue to seek passage of the HCRA. Addressing the health care crisis is a shared responsibility between government, workers and employers. No one should be let off the hook.

For a disturbing number of people, debates about government begin and end with: "What’s it gonna cost me?"

That’s not surprising given the proliferation of corporate and ideological news sources obsessively focused on taxes, and whether somebody somewhere is going to raise them. The only other government coverage they offer is when something goes wrong.

So with government-bashing replacing baseball as post-Reagan America’s national pastime, it should come as no surprise that some people know only this about the 2005 legislative session: taxes were raised.

Not the biggies like property, sales or business taxes. But yes, it just got a little more expensive to buy gasoline, cigarettes, liquor, and to die with more than $2 million in the bank.

Except for the gas tax, many of us are not affected much. Only 250 or so families will have to deal with the estate tax each year (merely restored after some activist judge repealed it this year). And speaking of dying, fewer than 20 percent of us smoke. As for the gas tax, by the time it is fully phased in (July 2008), a typical driver will pay about $5 more a month.

It’s time to change the conversation and ask, "What am I getting for my tax investment?"

In the case of the gas tax, for the price of some popcorn at a monthly movie, we get a lot more than just 270 necessary highway, bridge, intersection and ferry system projects (see the list). Lives will be saved, thousands of family-wage jobs will be created, our state economy will improve, and our children will reap the same dividends we enjoyed when previous generations invested in our transportation system.

What did you government-haters get the last time OPEC jacked the price of oil? Just the peace of mind that President Bush’s hand-holdin’ chums in Saudi Arabia can afford a new Airbus jet for their entourage.

Union members understand better than most that paying your dues is more than just a metaphor. It is a real investment in your job, in your family, and in your community. It is a duty.

Taxes are the dues we pay to live in a civilized, safe society. No, we don’t have to enjoy paying them, and not all tax increases are worth what they buy. But fair and reasonable taxes are necessary. Like anything else, when it comes to quality public services, you get what you pay for.

We veterans like to remind people that we fought to protect Americans’ rights, including for those who vocally oppose U.S. military actions.

We taxpayers have a duty to invest in our nation and in our state. All of you incessant tax complainers out there, remember that the rest of us are devoting a chunk of our paychecks to pay for the road you’re driving on, the Internet you’re blogging on, and the public airwaves you’re ranting on.

As Republican Rep. Fred Jarrett told a reporter (in a moment of clarity he probably now regrets): "I think we as Republicans have staked out our no-new-taxes mantra for so long, we’ve forgotten there’s a reason for government and a reason for taxes."

This year legislators heard and heeded an urgent message about our state transportation system: it’s no longer just about traffic and the economy, it’s about saving lives.

The anti-tax fervor of recent years, fed by initiative hucksters who would have us believe that we can get what we need for free, have resulted in more than a decade of neglect of our roads, bridges and ferries. After the failures of important transportation ballot measures, the 2003 legislature approved an important but stopgap "Nickel Package."

Democrats and Republicans came together to recognize the problem has gotten so bad that our families are now in danger. The emergency was sufficiently clear that legislators weren’t debating whether another transportation investment was necessary, but how much would get the job done.

In the end, they agreed to a 9.5 cent per gallon gas tax increase phased in over four years. The first 3-cent increase in July 2005 will cost drivers (22 mpg, 12,000 miles a year) an extra $1.33 per month.

In exchange, we get an historic $8.5 billion investment in Washington state. Over 270 highway, bridge, ferry and transit projects are funded -- in all parts of the state -- with the focus on fixing our most dangerous roads and worst congestion points.

The package will create some 70,000 family-wage construction jobs and 195,000 other jobs over the next 16 years. More importantly, it invests in our state economy, just as previous generations invested in our current infrastructure to foster today’s businesses and jobs.

All legislators who took this tough vote (Senate Vote #11; House Vote #14) deserve thanks, as do transportation leaders Sens. Mary Margaret Haugen (D-Camano Is.) and Dan Swecker (R-Rochester), and Reps. Ed Murray (D-Seattle) and Beverly Woods (R-Poulsbo).

The Retrospective Rating Program is a workers’ compensation program set up to promote work safety. But it has evolved into something else. Business associations now use it for purposes it was never intended, including to fund lobbying activities, lawsuits, initiatives, campaign contributions and other things that have nothing to do with workplace safety.

The "Retro" program offers incentive payments -- hundreds of millions of dollars a year -- to businesses that band together into work-safety groups administered by employer associations. But the program is rigged to give disproportionately high payments to the biggest retro groups. These groups charge fees as high as 20 percent of the payments, but their members agree to pay because its the only way to get the big Retro check. Business associations are using their Retro program "profits" to fund campaign contributions that appear to have politically insulated the whole program from reform efforts.

Several legislators floated ideas in 2005 about how to improve Retro by limiting or restricting the fees. For their trouble, they were lambasted by business groups, and some newspaper editorial boards, and accused of seeking "political payback."

Ultimately, SB 5842 emerged as a fair-minded Retro bill with the best chance of passage. Sponsored by Sen. Mark Doumit (D-Longview), it clarified the intent that all Retro fees be used for the program’s purposes: to improve workplace safety, accident prevention and worker outcomes. The incentive payments would be sent directly to individual employers, not to the Retro group administrators as is currently done. Then those employers can pay their Retro administrator whatever fee they see fit.

But self-interested Republicans -- the political benefactors of this Retro arrangement -- blocked SB 5842 from consideration. In the end, it failed to get a Senate vote, with Democratic supporters indicating they were a single vote shy of the 25 votes needed.

The partisan lines drawn on this issue should underscore the need for reform. This program has become so mired in partisan politics, we cannot today even answer questions about its cost-effectiveness.

It is the state legislature’s responsibility to examine this program and answer some critical questions. Is the amount of money invested in it justified? Do the payments to Retro employers unfairly increase the premiums for non-Retro employers? Do Retro programs even reduce injuries?

Such questions remain unanswered largely because all the people asking them stand accused of political payback. The WSLC rejects these accusations as cynical, simplistic and, in the case of business associations, obviously self-serving. It is unacceptable for a government program to be used as a private cash cow and then be insulated from change by the political influence that money purchases. That ain’t free speech; it’s inherently corrupt.

The WSLC’s support for Retro reform has spawned a threat from the biggest Retro association, the Building Industry Association of Washington, to finance a union-busting "right to work" initiative. Again, this should underscore the need for reform.

The WSLC will not be intimidated into silence. All workers and employers who contribute to our workers’ compensation system have a vested interest in the scrutiny and reform of this expensive safety program.

Our new governor addressed hundreds of union representatives at the 2005 WSLC Legislative Conference in front of a banner that read: "Welcome, Governor Gregoire."

Later that day, our embattled new governor signed her first bill into law, SB 5097, putting into statute her predecessor Gov. Locke’s 2000 executive order on apprenticeship utilization. This promotes family-wage job opportunities by requiring 15 percent of work hours on major public works projects be performed by state-certified apprentices. Sponsored by Sen. Jeanne Kohl-Welles (D-Seattle), SB 5097 moved quickly in the session’s first weeks. It passed the Senate 27-19 (Vote #1) and the House 58-40 (Vote #3).

In the context of the 2004 election debate about outsourcing and manufacturing job loss in the state, there was general agreement that we need to do a better job training workers for the jobs that remain.

Apprenticeship is the ideal solution. Unlike many training and retraining programs, apprenticeships are financed by the existing workforce and the employers that benefit from them. More than 10,000 apprentices are registered at our community and technical colleges, and earn the highest wages of any job-training program. Although those jobs may be economically cyclical, they cannot be outsourced offshore.

Apprentices testified how these life-changing programs provided them family-wage job opportunities they didn’t previously have.

When Gov. Locke implemented his apprenticeship utilization order five years ago, construction industry lobbyists made dire predictions of higher costs and excluded contractors. But none of that has happened. (For one thing, the requirement is waived if not enough apprentices are available or in other extraordinary circumstances.) By all accounts, apprenticeship utilization requirements have been a tremendous success.

Thanks go to the governor, Senate Majority Leader Lisa Brown and House Speaker Frank Chopp for moving SB 5097 along quickly, and to Sen. Kohl-Welles and Rep. Steve Conway (D-Tacoma), who sponsored HB 1028.

Nearly half of the workers in our state get no paid sick leave, so they lose their incomes -- and sometimes their very jobs -- when a family health emergency or a new baby arrives. The federal Family and Medical Leave Act provides for up to 12 weeks of leave for such events, but about 40 percent of the workforce is not covered, and even if they are, it’s unpaid leave.

The Washington State Labor Council believes that all workers, when faced with a serious health condition in their families, should be assured both job and economic security.

That was the idea behind SB 5069, sponsored by Sen. Karen Keiser (D-Des Moines), and HB 1173, sponsored by Rep. Mary Lou Dickerson (D-Seattle). These bills would have created a Family Leave Insurance program for all Washington workers who must temporarily leave their jobs to care for newborn or adopted children, or to care for sick family members. These workers would get up to five weeks of job-protected paid leave with a maximum benefit of $250 per week. It would cost workers about $40 a year and would apply to all businesses.

The WSLC believes these bills to be pro-family and pro-business. Individual business owners testified that paid family leave would help them save money and retain skilled workers. Rather than having valuable employees forced to quit because of an illness in the family, they could get a partial wage and then return to the job for which they have been trained.

But business associations, including the National Federation of Independent Business, the Association of Washington Business and the Washington Retail Association, came out strongly against the bills.

Nevertheless, under the leadership of Senate Majority Leader Lisa Brown (D-Spokane), the State Senate took a strong stand and passed SB 5069 on a 26-21 vote (see Vote #4), with Sens. Don Benton (R-Vancouver) and Bob Oke (R-Post Orchard) joining all Democrats except Sens. Tim Sheldon ("D"-Potlatch) Mary Margaret Haugen (D-Camano Island) in supporting the measure.

SB 5069 was amended to address business concerns, including exempting employers with 50 or fewer employees but allowing them to opt in. But it wasn’t enough for business groups, which aggressively opposed it in the House, where it died without a vote.

Advocates for fire fighters and others succeeded in fixing a technical error in the Family Care Act. That measure guarantees that workers have the right to use their sick leave or other paid leave to care for certain ailing family members, if necessary.

It passed in 2002 with broad bipartisan support, 96-0 in the House and 38-10 in the Senate (then-Sen. Dino Rossi was one of the 10 who voted against it.) But a problem arose when certain workers, including fire fighters covered under LEOFF 1, were being denied this leave because instead of getting "sick leave," their employers offered "short-term disability leave."

Sponsored by Sen. Harriet Spanel (D-Bellingham), SB 5850 eliminates the ability of employers to bar workers from the right to family care in such a way, provided their disability leave policy is not a purchased insurance product and provided they don’t have an additional sick leave benefit.

The bill passed the Senate (see Vote #13) and House (see Vote #13), and despite some challenges in the Governor’s Office working out the details, was signed into law.

There are many more stories included in the print version of the WSLC's 2005 Legislative Report on issues like offshore outsourcing, election and campaign reform, gay civil rights, agency performance audits, workers' compensation, mental health parity, prescription drugs, health care disclosure, and much much more. Union members may request a free copy.