HGEA wins 10%
state pay raise

Gov. Lingle criticizes the binding-
arbitration award, saying it will
end up hurting state programs

CLARIFICATION Tuesday, April 19, 2005 » The Hawaii Government Employees Association won an arbitrated award that provided an average wage increase of 8 percent for the 2003-2005 contract. According to the terms of the contract, HGEA members received no raises in the first year of the contract. All the raises took effect in 2004. A story on Page A1 Saturday might not have been clear. The Honolulu Star-Bulletin strives to make its news report fair and accurate. If you have a question or comment about news coverage, call Editor Frank Bridgewater at 529-4791 or email him at corrections@starbulletin.com.

Members of the state's largest union, the Hawaii Government Employees Association, will get pay raises averaging 5 percent in each of the next two years.

HGEA pay awards Past binding-arbitration awards for members of the Hawaii Government Employees Association: 2004-2005: 8 percent 1999-2002: 14.5 percent

Gov. Linda Lingle criticized the binding-arbitration award last night, saying it will cost the state $97.3 million during the next two fiscal years, beginning July 1.

Lingle said while the state can "technically" afford the pay raises, it will "diminish the state's ability to provide for its people as a whole."

"We won't have the money we should for our needy, our schools, our harbors, our airports, our environment, new programs and initiatives; and we won't have the money we should to help those of our citizens who do not work for the State of Hawaii," Lingle said in a news release.

Randy Perreira, HGEA deputy executive director, said the union was satisfied with the award. "We think it was fair and equitable."

The first increases will show up as step movements for some workers on July 1, Perreira said, but the first across-the-board increase will not be until Oct. 1.

The state had offered the 23,000 white-collar state and county workers raises of 1.5 percent a year for the next two fiscal years, while the HGEA had asked for raises of between 10 and 14 percent during the same period.

The wage proposals were given to a three-member panel, with a representative from labor, one from management and a neutral arbitrator. The arbitrator then fashions a wage package that both sides have to accept.

Lingle said the binding-arbitration award will hurt Hawaii because any increases in state revenue will go to fund larger and larger public-employee pay raises.

"The arbitrator says we can afford the raises. While this is technically true -- we won't go broke now -- we lose so many opportunities to make Hawaii a better place.

"There is no reason to award the entirety of our economy's growth to our state employees," Lingle said.

"I say this to the Legislature ... repeal binding arbitration before we permanently mortgage the futures of Hawaii's children," she added.

Perreira said Lingle hurt the state's finances by agreeing to a large pay increase last year for the University of Hawaii faculty.

"The governor's rhetoric is nonsense as far as I am concerned," he said.

Sen. Brian Taniguchi, chairman of the Ways and Means Committee, said the state's budget will have to be changed to accommodate the new salary increase.

"We will have to work around it or work with it and take a look at our priorities so we fund what we need," Taniguchi (D, Moiliili-Manoa) said.

Last year, the union won an arbitrated award that covered the 2004-2005 period. It represented an average 8 percent increase for the life of the contract, according to Russell Okata, HGEA executive director.

Lingle also objected to that award, instead offering the union 4 percent. The Legislature and the union rejected Lingle's proposal.

The governor said last year that the state could not afford raises that would total $85 million for the life of the contract.

The Legislature then passed the pay raise increase, which Lingle vetoed, but the Legislature overrode her veto.

Georgina Kawamura, state budget director, said if the same raises were given to all public employees, "the total increase in collective-bargaining costs to the state would be about $222 million over the next two years."

The state is also negotiating with the United Public Workers, the state and county blue-collar union, and the Hawaii State Teachers Association.

Neither of those two unions is required to go into binding arbitration.