“There was a path forward so we tried one more shot, and we got there,” said Najeeb Khoury, LAUSD’s Director of Labor Relations.
Bus driver Tanya Walters, vice president of SEIU Local 99, credited “the power of organizing” and said members were, for the most part, celebrating this deal that will increase their wages. “We had to take a stand.”
The deal reached Tuesday night, which still must be ratified by the union and approved by the LAUSD Board, makes it harder for new workers to qualify for free lifetime health benefits, which employees currently receive after working 25 years continuously and when their age and years of service add up to 85.
Tuesday's deal would raise that eligibility for new employees to 30 years of continuous service and would kick in when age and years of service add up to 87. In exchange, SEIU members got some wage increase concessions, some of which are based on the financial health of LAUSD, which will be decided by an outside arbitrator rather than the district itself.
While Board Vice President Nick Melvoin (BD4) indicated the deal did not go far enough, and he may vote against it, this is the first time any of the bargaining units have budged on healthcare, which is a significant source of financial distress for LAUSD.
At the Board meeting Tuesday, LAUSD’s Interim Chief Risk Officer Mampre Pomakian presented a report showing the present value of retiree benefits – the amount of money LAUSD would need today to pay for current and future retiree healthcare – has reached a staggering $22.6 billion.
The unfunded health benefits liability is growing worse – by 5 percent a year -- taking more and more money away from current employees and kids in the classroom. Unless dramatic change happens, about half of LAUSD’s budget will be going out the door to retirees in less than 15 years.
“We’ve got a major problem,” said Board Member Richard Vladovic (BD7). “We’ve got to deal with it. We can’t hide.”
LAUSD in February struck a three-year deal to keep its current healthcare contribution at the same level for the next three years without forcing any plan changes – a deal that parents widely criticized as irresponsible. “I know many people think our previous deal wasn’t enough,” Khoury said, but “we’re putting all these small pieces together to try to get an impact.”
The district has promised to create a committee to work on changes to the health plan, which will include parents, but the committee has yet to meet.
“I think people are in denial about this,” Melvoin said at the Board meeting Tuesday.
The deal with SEIU is the first labor contract finalized with any of LAUSD’s bargaining units. Still ongoing are talks with United Teachers Los Angeles, which on Tuesday said it would join next week’s one-day SEIU strike in sympathy, before that strike was called off.
LAUSD was preparing to fight that move, which would have forced the cancellation of school in the midst of standardized and AP testing. “We do not believe it would have been a legal action,” Khoury said.
Added Alex Molina, LAUSD’s chief labor and employment counsel: “We were in the process of preparing a charge against UTLA to stop the strike.”
For now, parents and the district are both celebrating the fact that classes will go on as planned, with all workers reporting for duty, as usual, on Tuesday.