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Supporters of civil service reform are outraged by news that an arbiter is about to hand pay raises of up to 15 percent to 23,000 state workers represented by the Hawaii Government Employees Association -- despite claims of the governor and Legislature that the state can't afford raises in this weak economy. In a bind over
government pay raisesReformers should see it as a gift. The HGEA arbitration is a dramatic example of a system dangerously out of kilter and sorely in need of change. How can elected officials possibly manage the cost of government or the direction of its programs with so little control over payroll?
The HGEA case will crank up public pressure on legislators to pass at least some of the reforms proposed by Gov. Ben Cayetano to restore the balance of power between public worker unions and state negotiators.
Perhaps the most obvious reform is to get rid of binding arbitration and give public employees the right to strike -- a change supported by Cayetano and the House but opposed by the Senate and the unions.
Collective bargaining is about finding the fair value of the work in question. Employers probe to find the least it will take to satisfy workers and avoid a strike over pay, benefits and work rules. Unions try to find the most the employer will pay before allowing workers to go on strike.
Occasionally there's no middle ground and we see ugly strikes, but in most cases the system produces fair settlements because both sides are accountable for their miscalculations. Workers fear the insecurity and lost wages of a strike. Employers fear the lost business and angry customers.
This central dynamic of collective bargaining is absent when the right to strike is replaced by binding arbitration.
Arbitration sounds civilized, but in practice it gives neither side much incentive to bargain. For the unions, especially, it's all reward and no risk when they don't have to chance the hardship of a strike to get what they want.
Arbiters don't even have to consider the state's ability to pay, figuring legislators can always increase taxes to pay for raises. It leaves taxpayers -- and the state's economy -- hostage to the whim of unelected arbitrators looking at a very small picture.
Leading public worker unions like this system so much that they are battling fiercely in the Legislature to prevent any significant part of it from being changed. That alone tells us how one-sided collective bargaining has become.
Unions defend arbitration as a way to assure that public services are not disrupted while a fair agreement is worked out. This argument might apply to vital public safety workers like police officers and firefighters, but we'd manage to survive if most other agencies shut down for a strike.
In the current HGEA case, maybe the state wouldn't have been so adamant about giving no raise if it were facing public hostility over the disruption of an employee walkout. Maybe the union would have come down from its demands if workers had to risk a strike to get what they won so easily at arbitration.
Arbitration gives employees who perform routine services the same bargaining power as those in the most important and dangerous jobs. The result can be underpaid police officers and overpaid clerks.
Teachers, certainly among the most vital state employees, have one of the few contracts with the right to strike and they like it fine. If it's good enough for the teachers, why not the HGEA?
David Shapiro is managing editor of the Star-Bulletin.
He can be reached by e-mail at editor@starbulletin.com.
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