Over the objections of unions that represent thousands of employees, the Los Angeles City Council agreed Tuesday to scale back retirement benefits for future hires in an effort to reign in what city budget officials say are unsustainable costs.
The 14-0 vote came after passionate speeches from union members and city council members alike. A last minute motion from Councilman Richard Alarcon asked labor leaders and budget officials to meet in the next 30 days, at which point the pension ordinance will come back for a second vote, as mandated by the city's charter.
The new benefits would impact civilian workers hired on or after July 1, 2013.
The Coalition of L.A. City Unions has threatened to sue the city for breach of contract, and a letter from the group’s attorney said an unfair employment practice charge could be filed with the Employee Relations Board.
The pension plan, which was backed by Mayor Antonio Villaraigosa and Council President Herb Wesson, will:
- Increase the retirement age from 55 to 65
- Calculate retirement benefits on 75 percent of an employee’s final compensation, instead of 100 percent
- Cap cost-of-living adjustments
- Eliminate healthcare benefits for dependents
"If I slit my wrist I would bleed union blood," said Wesson just before the vote. "I put my union credentials up against anybody around this horseshoe. But I say to you, this was my idea. I am the quarterback of this team.”
City Administrative Officer Miguel Santana, the city’s top budget official, believes the new benefits can be approved simply by a council vote and signature of the mayor. However, labor leaders argue the proposal is subject to collective bargaining.
“The city has neglected to include us in this process about pension reform," said Bob Schoonover, president of SEIU Local 721, "and their plan won’t save any money at all because as far as I know, they’re not hiring anybody.”
Prior to the council vote, dozens of union members rallied outside City Hall in protest of the pension plan. Members wore cheesehead hats and chanted “L.A. is not Wisconsin” as they likened Mayor Antonio Villaraigosa’s treatment of union workers to that of Wisconsin Gov. Scott Walker, who faced a recall effort for his changes to benefits for public workers.
“This is not Wisconsin. There was one bad call last night and it looks like there might be another bad call today,” said Schoonover, referring to a bungled call during the Green Bay Packers game against the Seattle Seahawks.