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State of Iowa, union agree on contract; state employees will continue to pay nothing toward their health insurance

(DES MOINES) – Today, results of the AFSCME contract negotiations between the state of Iowa and the union were made known. Key provisions:

· The contract costs $94 million less than it would have under the contract approved two years ago, providing direct savings to the taxpayers of Iowa.

· Iowa will continue to be one of only six states in the country where the overwhelming majority of state employees pay nothing toward their health insurance

Gov. Terry E. Branstad today released the following statement in response to today’s decision on the AFSCME contract.

“I want to commend everyone who was involved in negotiating this contract. The negotiations were aggressive and were professionally conducted by all parties.

“We were able to come to an agreement with AFSCME on two of the three major components of the new contract and for the first time in bargaining history there will be no across-the-board pay increases for the duration of the contract.

“I am disappointed that Iowa will continue to be one of only six states where the overwhelming majority of state employees will continue to pay nothing toward their health insurance. This is simply unfair to the vast majority of Iowans who pay some, if not all, of their own health insurance cost and whose tax dollars continue to fund this expensive benefit for most state employees.

“I will continue to ask state workers to join those in the SPOC union who agreed to pay just 20 percent of their health care premiums, with the opportunity to pay less as they become healthier and participate in life-enhancing wellness programs. It is right, it is fair, and it will make our state worker population healthier. Everyone wins when state workers contribute to make their lives healthier. That said, arbitrating an impasse item like health insurance is a part of our system. We will live with today’s result.

“These negotiations demonstrate that we can obtain fair results. Unlike two years ago, this administration made sure taxpayers were actually represented in these negotiations. When Gov. Culver simply took the unions’ first demand, taxpayers were socked with a $202 million bill. As a result of our efforts, the cost of this contract is $94 million less than it would have been under the previous contract. This is real savings for Iowa taxpayers and I am pleased the unions agreed to these terms.”


AFSCME Iowa Council 61 President Danny Homan issued the following statement regarding Arbitrator Marvin Hill, Jr.’s arbitration award that was opened today:

“During the arbitration hearing, our Union made clear that state employees have repeatedly made wage concessions and plan design changes to maintain their health insurance. We demonstrated that the state currently has historic surpluses and that state government’s health insurance costs for employees have been stable over the past several years. We also noted that the State’s Final Offer on health insurance was nothing more than cost shifting; it did absolutely nothing to lower the overall cost of the State’s health insurance plans. We pointed out that the State’s Final Offer would basically be a large pay cut for state employees. We also showed that the Aon Hewitt wage and benefits studies were flawed; these studies used one comparability group for the wage comparison and then used a different comparability group for the health insurance comparison.

“We are pleased that the arbitrator recognized that the Union’s Final Offer was the most reasonable proposal and that the appropriate decision was to support AFSCME Iowa Council 61’s Final Offer on health insurance.

“With this fair and final decision, AFSCME members are pleased that we will be able to look forward and focus on providing public services to Iowans.”

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