December 03, 2009
Two-year contract calls for 3 wage reduction with no automatic yearly wage adjustments or step increases
Montpelier, Vt. – Governor Jim Douglas and Secretary of Administration Neale Lunderville today announced that agreement on a new two-year contract has been reached with the Vermont State Employees Association (VSEA). The contract, which was signed by both parties earlier today, includes a 3 wage reduction as well as no automatic yearly wage adjustments or step increases for the duration of the contract. This settlement is very good news for the taxpayers of Vermont. It recognizes the Governor’s call to share the sacrifice broadly during these very challenging economic times.
“In this economy, as thousands of Vermonters are unemployed and tens of thousands more have seen their pay, hours and benefits cut, and as our state faces massive budget shortfalls in the coming years, it is appropriate that public employees share in the sacrifice,” said Governor Douglas. “This contract is a critical step towards bringing state spending in line with declining revenues.”
This new contract will produce $2 million in General Fund savings for FY2011, which will help offset a budget shortfall of at least $150 million. Importantly, wage costs will not increase over the two year period aggravating the overall deficit – although health care costs are expected to rise. The contract does not contain either changes to employee contributions for health care benefits or any modifications to the employee wellness and tuition reimbursement programs.
While net savings are small as compared to our total budget challenge, the significance of this agreement cannot be understated. “This deal sets the new standard for all public employee salaries in Vermont, as well as for non-profits who get a significant portion of their revenue from the State,” said Secretary Lunderville. “As families struggle to make ends meet, this agreement shows a common sense approach that should be applied to salaries for public sector employees and can serve as a blueprint for teachers, municipal workers and others who receive a paycheck from taxpayers.”
Economists have reported that Vermonters have lost over $1 billion dollars in income in the past year. In the last two years, state employees have received an average 7 increase. During the same two year period, the Governor, his appointees and some other elected officials took a 5 pay cut and have had wages frozen since July 1, 2008.
Source: Office of the Governor
Last Updated at: December 03, 2009 15:55:50