May 15, 2013 - Oxford's full-time firefighters have a new union contract that includes an 8.5 percent pay raise over three years.
The township board last week voted 5-2 to approve a contract with the Oxford Fire Fighters Union, International Association of Fire Fighters (IAFF) Local 4763.
"I think all in all it's a good deal for both the firefighters and the township," said Trustee Jack Curtis, who was part of the team that negotiated on the township's behalf.
"I think it's a fair and equitable contract based on what the (township) board has (previously) voted in for themselves (in terms of pay and benefits)," said Oakland County Commissioner Mike Spisz (R-Oxford), who was also part of that team along with Fire Chief Pete Scholz.
Contract negotiations began in July 2012. The previous contract expired Dec. 31, 2012.
"We were happy to finally get a deal made," said Darin Balinski, vice president of Local 4763. "There was hard work on both sides. We're just happy to have it behind us."
The new contract took effect on May 7 and runs through Dec. 31, 2015. It applies to the department's 12 full-time employees, excluding the chief and administrative assistant.
Oxford's fire union voted 9-0 to ratify the contract on May 2. Three members did not vote because they were unable to attend the meeting.
"Overall, it's a fair contract," Balinski said. "Anybody's happy with a pay raise in this environment."
Under the contract, all full-time union employees will receive a 3.5 percent pay raise this year, a 3 percent increase next year and a 2 percent pay hike in 2015.
"The raise was just in line with what the township has already offered the non-union employees, so we just followed suit," Balinski explained.
The township's three full-time elected officials and employees received a 3.5 percent raise in 2012 and a 3 percent raise in 2013.
Oxford's full-time firefighters, on the other hand, received no pay raises from 2010 to 2012.
The firefighters' pay raises for 2013 and next year are designed to mirror what the rest of the township employees have already received with one exception. The 2013 pay raise is not retroactive, so it does not apply to what they've already been paid for January through April. The 3.5 percent pay increase took effect with the pay period that began May 7.
"It's just basically catching the firefighters up to what the township board gave (the three full-time elected officials) and all the (township) employees," Spisz said.
Curtis characterized it as a "cost of living" increase.
On top of those percentage increases, the fire inspector and EMS coordinator will receive a $1,000 supplemental increase each year.
"If you look at (those positions') hourly rate, they're way under everybody else, so we agreed, when we did the first contract two years ago, we were going to bring it up slowly as we went, instead of giving them a big bump," Spisz explained
Treasurer Joe Ferrari voted against the contract because he's worried about how the township is going to fund these employees' retirement benefits when they end their careers.
Right now, the firefighters' retirement benefits through the Municipal Employees' Retirement System (MERS) are "only 71 percent funded."
"Basically, if we don't get that MERS funding up, we're going to have a financial situation in 20 years," Ferrari said. "Let's say they all retire tomorrow, we can only pay 71 percent of their benefits. We're obligated for 100 (percent). We're not even at the minimum."
According to the treasurer, MERS likes a municipality to maintain a minimum retirement funding level of 80 percent, then work towards achieving 100 percent, which is the goal.
Ferrari said this issue is of particular concern to Oxford because about nine or 10 of its full-time fire employees are all about the same age.
"We've got a work-force that's pretty much all going to retire at the same age," he said. "Let's say they all go in 20 years, who's going to pay that? When you're only 71 percent funded, somebody's got to pay that."
"It wouldn't be as bad if our firefighters were spaced out (in terms of age)," Ferrari noted. "But (their retirements are) all going to happen at one time. And I can understand that. Once they get their service in, they're going to want to go and enjoy retirement. I respect that."
The treasurer sees other communities like Detroit, Pontiac and Benton Harbor "struggling with retiree issues" and that worries him.
"I don't want that to be us in 20 years," he said. "I'd rather do the planning right now – at least slowly climb up to that 100 percent (funding) . . . I don't want to be in a spot 20 years from now with the township in tough financial shape, trying to pay for retiree benefits."
Simply giving the firefighters an 8.5 percent pay raise "does nothing to address the retirement situation," in Ferrari's view.
Ferrari indicated he would have rather seen some type of combination such as giving the firefighters a 4 to 4.5 percent pay raise and putting the remainder of the 8.5 percent toward funding their retirement benefits.
"It's still their money," he said. "It's just whether they get it now or when they retire."
Oxford's full-time firefighters currently contribute 2.5 percent of their gross wages to offset the cost of the MERS retirement plan. That amount is deducted from their paychecks and did not increase under the new contract.
When asked if there was any thought to increasing this percentage, Spisz replied, "There was some very early conversation, but that got negotiated out pretty quick."
The treasurer made it clear his vote against the new contract was solely based on retirement funding and nothing else.
"Our fire department does a good job – that's not the issue," Ferrari said. "My issue had nothing to do with job performance or things like that."
Other changes to the union contract include increasing the firefighters' co-pays for prescription drugs with the difference to be covered by a Health Reimbursement Account. Both the fire department and township will each save $12,500 annually because of this change.
"Everybody has to be on the same program," Spisz explained. "So, the township board and the township employees will also have to change to the same program."
Full-time firefighters who choose not to take health insurance through the department will be paid 50 percent of the $7,835 annual premium cost that the township would have paid to cover a single person. This represents an increase from the 40 percent payment under the previous contract.
What didn't change is the fact that full-time firefighters will continue to pay 5 percent of their health insurance premiums and do so for the next three years. They've been paying 5 percent since Jan. 1. 2012.
Instead of being paid a $750 lump sum uniform allowance every January, beginning next year, the fire department will provide a uniform bank allowance of $750 per union firefighter and any unused portion of that annual allowance will be considered a savings for the department.
Effective this year, the township will begin providing dry cleaning services for all full-time firefighter uniforms.
The township also agreed to a one-time purchase of Class A dress uniforms for all firefighters with at least five years of full-time service to the department.
"(They give us) a more professional look when we go to events," said Balinski, who noted the dress uniform symbolizes they're "a part of that brotherhood" of firefighters.
"It's customary that Class A (dress) uniforms are given to firefighters," Curtis said. "They attend funerals and ceremonies to help build pride in the community and pay homage to fallen firefighters. It helps them represent our community with dignity."
"I equated it to my kid (who's in the U.S. Air Force)," he added. "They gave him a full set of uniforms – one for battle, one for dress and one for casual."
Curtis noted the savings from the prescription co-pay change and the new uniform bank allowance should cover the cost of the dress uniforms and dry cleaning services.
"Should is a good word," he said. "If the savings doesn't cover it, the fire department budget will be impacted."
"We went into it as a cost neutral (change)," Spisz said. "If (the fire union) wanted anything that was a cost increase to the township – that was outside of anything already approved by the board for themselves – it would have to be cost neutral."
In other words, there had to be a corresponding cost savings in one area in order to cover an increase in another area.
Supervisor Bill Dunn thanked the township's bargaining team for "spending all their time fighting these guys tooth-and-nail."
"I'd also like to thank the guys, our firefighters, for doing the same – acting in good faith and coming up with an agreement."
CJ Carnacchio is editor for The Oxford Leader. He lives in the Village of Oxford with his wife Connie and daughter Larissa. When he's not busy working on the newspaper, he enjoys cigars/pipes, Martinis/Scotch, hunting and fishing.