 
May
2002
Dear Member:
This is the
latest in the series of informational pieces designed to update
you on the status of the PERB proceedings. This information will
supplement information being provided to the PBA board members and
delegates on a regular basis as developments occur, in an effort
to keep each of you well informed.
The final sessions
of the PERB Arbitration testimony were heard at two very long sessions
on Monday, May 6 and Tuesday, May 7.
City Witnesses
As you may
recall, the last two sessions were reserved for rebuttal arguments.
The City opened the rebuttal phase of the hearings on May 6, with
testimony from Mark Page, Director of the NYC Office of
Management and Budget (OMB), and David Rubenstein,
OMB's Deputy Director. Both Page and Rubenstein painted
a very bleak picture of the state of the City's finances in an
attempt to counter the compelling testimony of the PBA's expert
economists, Carol O'Cleireacain, Ph.D and Matthew Drennan,
Ph.D, who testified at the last session regarding the
state of the City and Federal economies. O'Cleireacain had testified
that notwithstanding the City's depiction of the financial state
of the City, the credit rating agencies still rated the City at
the highest possible level. Incredibly, Mark Page tried to deflect
O'Cleireacain's testimony by stating that the City was "cut a
break" by the rating agencies because of the September 11 attacks.
The next City
witness was Professor David G. Blanchflower, Economics Professor
at Dartmouth University. The aim of Professor Blanchflower's
presentation was to rebut the testimony of Professors Harry Katz
and David Lipsky, the PBA's expert Labor Economists from Cornell
University, who testified that cost of living differences must
be considered when comparing the salaries of New York City Police
Officers with the salaries received by their counterparts in other
national jurisdictions. Professor Blanchflower attacked as "flawed"
the Bureau of Labor Statistics ("BLS") derived cost of living
index developed by Professors Katz and Lipsky. However, when
confronted on cross examination with an excerpt from a book that
he authored (The Wage Curve, published in 1994)
which supported the methodology utilized by Katz and Lipsky,
he offered implausible testimony stating that "we used the cost-of-living
index [in the book], we really didn't believe it, we didn't trust
it." Professor Blanchflower also gave testimony in an attempt
to rebut the methodology utilized by the PBA in its comprehensive
comparability analysis prepared for the PBA by Linn & Green
Associates. Addressing the PBA's private sector analysis, Professor
Blanchflower stated that NYC police officers are more appropriately
compared to security guards. He also stated that "if a
market adjustment were required, I would expect to see an inability
to hire the requisite numbers of high quality officers, also resignation
rates would be high in both absolute terms and in relation to
the past - and a significantly higher incidence of absenteeism."
He concluded by stating "there exists no convincing evidence to
suggest that a special 'market adjustment' above the pattern settlement
is required for New York City Police Officers."
The City then
put on Professor Anne Bartel, Economics Professor at Columbia
University. The thrust of Professor Bartel's testimony
was that salary is not the only thing that prospective police
recruits consider when deciding whether to take a position with
the New York City Police Department. Professor Bartel testified
that the benefits received by New York City Police Officers are
rich and act as a counterbalance to the lower salaries received
as compared to other jurisdictions with lesser benefits. She
cited the following examples of benefits that prospective officers
consider when deciding to take the job as a police officer: excellent
training, excitement of the job, promotion opportunities, and
the prospect of second careers upon retirement. However, Professor
Bartel's testimony was undermined on cross examination and in
the direct examination of PBA witnesses when she was unable to
explain away an article that she wrote ("Wages, Nonwage
Job Characteristics, and Labor Mobility," published in 1982)
that supported the methodology of deflating pay based on the cost
of living, which the PBA utilized in its comparability analysis,
and when former NYC Police Officer Michael Kline testified why
he left the job — money — and that the same benefits
to which Bartel testified and others were available at the PAPD.
Pulling out
all of the stops, the City next called upon The Mayor of
the City of New York, Michael Bloomberg, to present testimony
on the fiscal state of the City. Mayor Bloomberg stated that
the City's offer to the PBA was fair and is "much more generous
than the City could afford if [the bargaining] was just starting
out." The Mayor added that the City was a "victim of the downturn
in the economy," and the "terrible tragedy of 9/11." He reiterated
the points raised by Mark Shaw and David Rubenstein regarding
the economy and echoed the sentiments expressed by Labor Commissioner
Hanley with respect to the importance of pattern bargaining and
parity on the City's continued financial stability. In addition,
relying on the prior testimony of police officials, he denied
that the City was experiencing any difficulty recruiting qualified
police officers. The Mayor ended his testimony by stating to
the panel: "It's a wonderful city, do a good job."
PBA
Witnesses
Robert
W. Linn, the PBA's Chief Negotiator, put on a powerful
presentation using the City's own figures as a sword against them
to demonstrate that New York City Police Officers are grossly
underpaid vis- a- vis their counterparts both nationally and regionally.
The charts told a sad story about what happened to NYC police
officers' salaries in the 1990's, a decade in which NYC police
officers produced historic crime reductions and national cities
as well as regional jurisdictions received substantial raises
above the Consumer Price Index (CPI), while police officers in
New York City received raises below the CPI. Mr. Linn informed
the panel members that notwithstanding the City's reliance on
pattern bargaining, there exists more than one pattern in this
round. Linn stated, "in fact, there are four patterns so far."
He then led the panel on a virtual tour of the various settlements
reached in this round, including the civilian, librarian, uniformed
coalition agreements, and the recent recommendation handed down
by the panel in the United Federation of Teachers ("UFT") fact
finding proceeding. Mr. Linn concluded his testimony by urging
the panel to adopt "a fifth pattern that recognizes . . . the
absolute necessity for a market adjustment . . . ."
PBA
President Patrick J. Lynch (Excerpts from my testimony)
I
began my testimony identifying myself as the President of the
Patrolmen's Benevolent Association, and "more importantly I am
New York City Police Officer." I informed the Panel that "the
single key ingredient to the rebirth of New York City since the
dark days of record crime and murder has been the work of police
officers of the NYPD," noting that it was because of the hard
work of New York City police officers — "the City's greatest
single asset" — that New York is "one of he safest, most
liveable big cities in the nation."
Attempting
to put a face on the average New York City police officer, I described
in detail the unique dangers of our job, the cause of our low
morale, and the difficulties that we face trying to make ends
meet with the salaries we are paid. Echoing the testimony of
our expert witnesses, I discussed the crisis that we face with
regard to recruitment and retention advising the panel that "on
June 5, 1999, when I was entrusted with the Presidency of this
organization, I was proud to represent 26,500 police officers
. . . . and now have just over 23,000 police officers." Focusing
on the recruitment and retention crisis, I warned that "our ranks
have thinned and will continue to thin because of retirements
and losses to other much better compensated police departments,"
unless the Panel awards an adjustment to bring our salaries in
line with the market.
A 1998 report
of the findings of Mayor Giuliani's own Task Force on police/community
relations, which was comprised of thirty-three prominent community
leaders, stated that the NYPD was "a demoralized and dispirited
group" and that "the main source of discontent is low pay." The
Task Force report recognized the unique nature of police work
and recommended that police officers should be properly compensated
for the work they do. Characterizing the New York City Board of
Collective Bargaining ("BCB"), the Task Force described it as
a "joke" and "a stacked deck," pointing to the City's 27-0 record
against unions in interest arbitrations before the BCB.
Expressing
our frustration with the NYC collective bargaining process I stated,
"the police officers of the PBA have walked in the desert for
over a decade seeking a fair hearing." Looking back on the travesty
of the arbitration awards of the 1990's and our fight to have
our hearings heard by the PERB, I told the Panel that we have
swallowed hard and were forced to accept two OCB decisions that
we believe were patently unfair, and we have suffered through
the scorched earth litigation tactics by the City.
"Even
during the boom years of the 90's when the City generated record
surpluses and could have addressed the economic hardships of
police officers, it chose not to." While their neighboring Police
Departments have realized more appropriate levels of compensation,
the New York City Police Department's salaries have been virtually
frozen in time. Unfortunately, the trend has been that New York
City spends vast amounts of money to recruit and train police
officers only to have them leave for better paying jobs. Thus,
New York City has become the nation's job fair for police."
Although we
were never paid for the sacrifices we made — including the
loss of many heroes — "cops continued to do their jobs."
Commenting on the nature of our commitment and the City's lack
of appreciation for the work that we do, I said, "The world
and I watched as my members ran into the World Trade Center, some
for the last time . . . . They have risen to the occasion time
and time again. But when the smoke cleared, they heard the praise
but were greeted by the same song . . . 'we cannot afford to pay.'"
"The
time has come to pay those hero police officers for the work
they've done, the work they continue to do, and the work I know
they will do in the future. The time has come to relieve our
police officers from the need to hold down that second job.
The time has come for this City to help itself retain its most
valuable asset, the men and women who have earned the right
to be called New York's Finest . . . ."
Former
Chief Allan Hoehl testified about the unique nature
of police work in New York City. With over 40 years experience
in the NYPD when he retired in March, Chief Hoehl was the Department's
most senior Chief. Chief Hoehl testified extensively about all
aspects of policing in New York City that make our job one of
the most difficult in the country, including the increased responsibilities
police officers face in the wake of the terrorist attacks and
the continued threat of future terrorist acts. As for police
morale, Chief Hoehl informed the panel that "currently the overall
morale is very strongly affected by the low pay that they receive."
Chief Hoehl expressed great concern for the quality of officers
that the Department will be able to attract given the current
salaries stating that "without the appropriate salary, we will
not be getting the same quality." He left the panel with the
following thought: "if the quality of the people coming into to
the Department is reduced, I'm concerned that we will not be able
to provide the same services that we have been providing that
have turned the City around and made for the economic viability
that exists."
Former NYPD
Police Officer Michael Kline testified that after
proudly wearing his father's shield for nearly 5 years, he
rolled over to the Port Authority Police Department because of
the money. Officer Kline's sincere and honest testimony about
the difficulties of trying to live on a cop's salary, in his father's
basement, seemed to hit home with the panel. You could hear the
emotion in his voice when he told the panel that his father retired
as a police officer from the NYPD after 23 years of service, how
he wore his father's shield and how it broke his heart to turn
it in. His moving testimony depicted the unfortunate reality
that New York City Police Officers are confronted with - leaving
a job that they otherwise love to better provide for their families.
Police Officer Kline effectively contradicted the testimony of
Professor Bartel when he stated the only reason he left the NYPD
was because of the low pay.
Session
Ended - took approximately 12 1/2 hours.
PBA Witnesses
The PBA continued
its rebuttal case on May 7, starting with testimony from two heavyweights
in the law enforcement community —Thomas Constantine,
Former Superintendent of the New York State Troopers and Administrator
of the Drug Enforcement Agency ("DEA"), and William
J. Bratton, former Police Commissioner of the City of New York.
Both Constantine and Bratton gave impressive testimony about various
aspects of policing, the unique nature of police work in New York
City, and their expert opinions regarding police officer salaries
and recruitment and retention issues. Mr. Constantine
testified about his analysis of the cost savings to the citizens
of New York attributable to the crime reduction during the period
1994-1998. According to Constantine, there were just over 750,000
fewer victims of serious crimes in New York City during the period,
which conservatively translates into a direct savings for each
crime victim of approximately $1,000 for an aggregate total of
$750 million dollars. He testified that he knows of "no other
police agency or any location in the United States that has been
as successful as the City of New York" in reducing crime. He
also explained that, unlike today where NYS Troopers make more
than New York City Police Officers, when he became Superintendent
of the NYS Troopers in 1986, Troopers were paid below New York
City Police Officers and other police agencies in the metropolitan
area. Discussing recruitment and retention issues, Mr. Constantine
testified that as head of the DEA, he hired "a significant number"
of former New York City Police Officers; the DEA pays its Special
Agents in New York approximately $85,000 per year. Mr. Constantine
concluded by stating that NYC Police Officers "need to have a
fair salary."
Former
Police Commissioner William J. Bratton testified passionately
of his belief that "New York City police officers were . . . the
only losers in the 1990's in New York City." He explained further
that he, Giuliani and everyone around them benefitted from the
successes of the New York City Police Department in the 1990's.
Bratton stated emphatically, "everybody won except for cops."
He quoted from a scene from his favorite movie "The Magnificent
Seven" in which Yul Brenner said "they will always win and we
will always lose" as an analogy to what police officers felt after
they received the double zeroes contract. Bratton eloquently
characterized the travesty suffered by police officers in the
1990's:
"They
lost. They lost big time. They got lip-service and pats on
the back, 'great job fellas.' But when it came time to benefit
economically, and if ever there was a time to benefit economically
in this City, it was certainly during that era . . . . But if
those 24,000 cops were not out there plugging away every day,
making those arrests, putting their lives in danger, going the
extra mile, reducing their sick time, reducing their injured-on-duty
time . . . . They gave. They gave early, they gave often and
they continue to give. What have they gotten in return? Zero
. . . . The city reneged on a commitment that you work hard
and you benefit. They worked damn hard. Did they benefit?
Not at all. Not at all."
Commissioner
Bratton concluded that because of the high value that he placed
on the work of New York City Police Officers, he believed that
the PBA's 21.9 % wage proposal could and should be reached.
The PBA's
next witness was Ms. Eva Jacobs, the PBA's expert Economist,
who rebutted Professor Blanchflower's testimony by opining that
the BLS derived cost of living index created by Professors Lipsky
and Katz was "not only a perfectly valid index, but one that could
be used to deflate wages."
Professors
Harry Katz and David Lipsky, the PBA's expert Labor Economists
from Cornell University, discussed their analysis of the
pay received by police officers in the 21 largest cities compared
to the pay of New York City police officers concluding that, when
adjusted for the cost of living, New York City Police Officers
are ranked near the bottom of the list of these cities. Rebutting
the testimony of the City's witnesses, who refused to adjust the
salaries contained in their comparability studies based on inter-city
cost of living differences, Professor Katz said: "it defies economic
views and common sense to compare New York City and other national
cities, including Jacksonville, Memphis and others, in terms of
the pay they provide to police officers and other employees .
. . . without accounting for inter-city cost of living differences."
Moreover, Katz stated, "no matter how you cut it, New York City
has the highest cost of living across the 21 national cities and
exceeds the cost of living in the average of the next largest
20 cities by a consistent amount."
In addition,
Professors Katz and Lipsky testified as to their analysis of whether,
and to what extent, pattern bargaining exists between police and
public sector white collar employees in a sample of large cities
that they surveyed, concluding that when employers adhere to strict
pattern bargaining, certain employees often fall out of the salary
market, which leads to problems in areas of recruitment and retention.
Professor Katz testified "we continue to believe that there is
an acute recruitment and retention problem," which he characterized
as a "crisis." Lipsky and Katz predicted that the uniformed force
of the NYPD would shrink to approximately 35,792 by December 31,
2002 (down from 40,069 as of December 31, 2000) even assuming
the anticipated appointment of 1,200 new police officers in July.
Professor Lipsky buttressed Katz's testimony pointing out that
the outflows of police continue to exceed the inflows resulting
in a significant retention problem for the NYPD. Finally, Professor
Katz stated that it would be "inappropriate to say there is a
'pattern' in this round. Katz ended his testimony stating that
pattern bargaining is not valuable to the parties when "it produces
outcomes that are far out of line with market forces."
City
Witness
The City
called as its last rebuttal witness, James F. Hanley,
Commissioner of the Office of Labor Relations. Commissioner
Hanley moved quickly from subject to subject, reiterating his
earlier testimony regarding the importance of adhering to the
pattern and the consequences that will result if the panel renders
an award that breaks the pattern and disrupts the parity relationships
that exist between many uniformed bargaining units. His testimony
was peppered with criticisms of the testimony of PBA witnesses.
He said that pattern bargaining is a "reality" and "to destroy
it, . . . would create a nuclear meltdown." In closing, Commissioner
Hanley testified in support of the OCB Arbitration process and
against the perception that it was a "stacked deck" stating,
"it was always a gentlemanly scholarly approach."
Panel
Urged Agreement Between Parties
to Expedite an Award
At the end
of the hearing, Dana Eischen, the Chairman of the Panel,
expressed the Panel's unanimous interest in quickly issuing an
award. Addressing the Declaratory Ruling Petition Before PERB,
Chairman Eischen implored the parties to remove from the Panel's
jurisdiction any matters "still in an unfinished state before
PERB or other forums." The Panel "strongly urged" the
parties to comply with their recommendation because to do otherwise
would prevent them from issuing a timely award on the wage issues
presently before them. Therefore, in order to insure a speedy
award, the parties agreed that the Panel would issue a decision
on wages and health and welfare benefits, along the timetable
set out below.
The Panel
announced the following briefing schedule: post-hearing briefs
are due by June 14 and reply briefs on June 28. An award is expected
sometime thereafter.
Session
Ended - took approximately 13 1/2 hours.
| Declaratory
Ruling by PERB Administrative Law Judge |
Since we last
wrote, a decision was rendered in the Declaratory Ruling Proceeding
that was proceeding on a separate track at PERB (see January Newsletter).
The Administrative Law Judge ("ALJ"), Philip L. Maier, rendered
a decision, which is subject to appeal to the full board at PERB.
He found effectively that non-mandatory provisions of our expired
Collective Bargaining Agreement ("CBA") convert to mandatory subjects
and cannot be removed unilaterally from the contract by either party,
which was of great importance to the PBA. However, because of the
Police Commissioner's power granted under the NYC Administrative
Code, the ALJ concluded that provisions of our CBA relating to discipline
(including the so-called 48-hour rule contained in the Bill of Rights
Section of the CBA) are prohibited subjects of bargaining, consistent
with a prior ruling affecting the other police unions. We disagree
with the ALJ's ruling in this respect and will appeal to the full
PERB Board. Most importantly, our decision to appeal the ALJ's
decision will not delay the Panel's award.
The end is in
sight for this round of bargaining. It began over two years ago
on May 4, 2000, when we filed our demands. The City has fought us
every step of the way. We had to win a year's worth of court battles
just so we could have our case heard before a PERB appointed arbitration
panel. Throughout our struggle, we worked methodically and diligently
with our professionals to construct a powerfully convincing case.
Over the past several weeks, we have presented a very credible and
compelling case - by all accounts, the most comprehensive case ever
presented by the PBA. However, our job is far from over. The PBA's
team of professionals is preparing our post-hearing briefs fully
detailing the strong arguments already presented at the hearings.
Barring any unforeseen circumstance, we should have a decision by
mid-summer. In addition, believe it or not, the next round of bargaining
is already upon us and we are hard at work preparing our demands
for the next round.
We thank you
for your continued patience and support. We will keep you informed
as developments occur.
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