State labor upheaval in Iowa follows national trend

Some want to turn back clock on benefits, wages

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DES MOINES — Public-sector collective bargaining probably is experiencing the most upheaval and attacks it’s seen in four decades with Iowa increasingly joining the fray, experts on labor-management relations say.

And, the pressure is likely to intensify, they warn, as state budgets get squeezed by cutbacks in federal money and rising costs associated with pension, health insurance and other benefits negotiated over the years — often in lieu of wage increases — that could create unsustainable financial cliffs at the state and local levels exacerbated by an aging workforce.

“For labor right now, I think the situation is very difficult because unions are going to have to consider an option where it’s almost like someone is looking to press a reset button to move everything back to some distant point where benefits, compensation, whatever, is much less than it currently is,” said John Delaney, dean of the University of Pittsburgh’s Joseph M. Katz Graduate School of Business and College of Business Administration.

“Some of that is driven by just pure partisan politics, some of it is driven by finance, and some of it is driven by the fact that in the end there’s an advantage to one side relative to the other,” said Delaney, an expert on negotiation, dispute resolution, and labor-management relations.

“The real political issue for union leaders is going to be to figure out at what point do you hit the point of no return or the tipping point on this and what kind of agreement can you negotiate ... that is actually good for everybody?” Delaney said.

Balancing outcomes that often are more expensive than state officials want and fall short of workers’ expectations are contributing to an environment of labor unrest that has been fomented by efforts like Wisconsin’s success in paring back collecting bargaining in the state that launched it for public employees in 1959 and Michigan’s decision to become the nation’s 24th right-to-work state are part.

“It definitely seems that there are a lot more attacks on the right to engage in collective bargaining now than probably at any time in the last 40 years,” said Matthew Glasson of the University of Iowa Labor Center. “Some people think it’s more political than economic.”


It is against that backdrop that state negotiators are attempting to reach voluntary agreements with unionized public employee bargaining units on new two-year agreements slated to take effect July 1 and run through June 30, 2013.

Gov. Terry Branstad has been demanding that Iowa stop being one of six states that provide a health insurance benefit that allows many state employees to pay nothing for their coverage. He says requiring all state employees to pay 20 percent of their insurance premiums would save $115 million. The provision — along with a two-year freeze on wages and “step” pay increases — was included in initial contract offers made to state union leaders at the start of contract talks.

However, the state’s initial bargaining position also sought changes to scale back or repeal some workplace rules governing grievances, bumping and transfer rights, and discipline and discharge issues that date back to 1977. The state also proposed halting payroll collections of union dues and making other changes that prompted some critics to question whether the offer wasn’t really designed to make collective bargaining revamps that Republicans hoped to accomplish by taking full control of state government but were denied when Democrats held onto a two-vote edge in the Iowa Senate in last month’s election.

“If we hadn’t won the Senate, we’d be Michigan, we’d be Wisconsin, they’d get rid of collective bargaining,” said Sen. Joe Bolkcom, D-Iowa City.

Danny Homan, president of American Federation of State, County and Municipal Employees Council 61 — the largest state employees union that has sparred many times with Branstad during his five terms as governor, including prevailing in a court fight over an arbitrators binding award over 20 years ago — —aid his union made a modest offer that initially has been rebuffed by the governor’s negotiating team.

“This is a big deal,” said Homan, whose union has requested a 1 percent across-the-board pay increase in the contract’s first year and 2 percent in the following year for the roughly 20,000 workers it represents. The union also asked to maintain annual 4.5 percent step increases for employees who qualify based on their date of hire, but did not include any changes to its health care coverage.

“This guy is attacking basic union rights that have existed in this country for decades,” Homan said. “This is politically motivated. They can say it isn’t, but what they’re doing strongly indicates to me that it’s politically motivated. They’re trying to weaken the unions in this state. It’s a sad day.”

Branstad, during a radio call-in show earlier this month, refuted a claim by a state employee that the GOP governor was treating them like “an enemy” and painting them in a negative light with one-sided shots at their wages and benefits.

“I feel that I have an obligation to represent all of the people of Iowa and especially the taxpayers in the collective bargaining process,” the governor said. “I don’t want you to feel that means that I’m anti-state employee because I love and appreciate all the dedicated employees we have working hard for our state and I know they make significant


Whatever the outcome of the current round of bargaining is, the issue likely will carry over into the 2014 gubernatorial race with expectation growing that Branstad will seek an unprecedented sixth term as Iowa governor.

Delaney said unions who push a hard-line approach run the risk of states opting for “the nuclear option” of changing laws to move some issues outside of the scope of bargaining, especially if a binding award won via arbitration creates a long-term financial funding dilemma.

“My own view is that if you have a war between the taxpayers and the unions, the taxpayers are going to win because there will be a point where people just won’t be willing to pay anything more and that,” he said.

“It’s going to be interesting in the next few years because of all pressure that everyone’s facing. That’s the underlying pressure that’s really destabilized a situation that had evolved since the late 1950s,” Delaney noted. “The future probably is going to look different from what we’ve evolved into simply because of the cost side.” 

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