Labor Mgmt Health Care AgreeMEMORANDUM
June 12,2003
TO:
FROM:
SUBJECT:
The Honorable Mayor and City Council Members
Michael C. Van Milligen, City Manager
Amendment to the Joint Labor Management Health Care Committee
Agreement
Personnel Manager Randy Peck recommends City Council approval of the Amendment
to the Joint Labor Management Health Care Committee, which will be in effective until
June 30, 2005.
The Operating Engineer's Union, Teamster's Union, Transit Union and Non-bargaining
Unit representatives all agreed to make the requested changes and, therefore, will be
signatories to the Joint Labor Management Health Care Committee Agreement
Amendment. The Fireflghter's Association and Police Association will not be
signatories to the agreement.
I concur with the recommendation and respectfully request Mayor and City Council
approval.
Mich~ael C.~Van~M~lig~=n~-~
MCVM/jh
Attachment
cc: Barry Lindahl, Corporation Counsel
Cindy Steinhauser, Assistant City Manager
Randy Peck, Personnel Manager
CITY OF DUBUQUE, IOWA
MEMORANDUM
June 12, 2003
TO:
FROM:
Michael C. Van Milligen
City Manager
Randy Peck
Personnel Manager
SUBJECT: Amendment to the Joint Labor Management Health Care Committee
Agreement
In February of 1996, the City's bargaining units signed the attached Agreement
that removes health insurance from the collective bargaining process and places the
management of the health insurance program in the hands of the Joint Labor
Management Health Care Committee. In June of 2002, the Agreement was amended
to extend through June 30, 2003. The Health Care Committee met on June 12, 2003,
to discuss several changes to the health, dental and prescription drug insurance
programs. I told the Committee I would consider recommending a continuation of the
Agreement with those bargaining units that would agree to making certain modifications
to the health, dental and prescription drug programs. Operating Engineer's Union,
Teamster's Union, Transit Union and Non-bargaining Unit representatives all agreed to
make the requested changes and therefore, will be signatories to the Joint Labor
Management Health Care Committee Agreement Amendment attached to this
memorandum. The Agreement is recommended to be extended until June 30, 2005.
The Committee structure will include non-bargaining unit and management
representatives and all bargaining units except the Firefighter's Association and Police
Association. The terms of the Agreement will remain the same. Any future savings
resulting from the actions taken by the Committee would be shared with employees in
the form of modifications to the health insurance program. Fifty percent of the savings
would be applied in this manner. There would be no sharing of risk on the part of our
employees, if the cost of health insurance is higher than we projected. The formula for
computing the savings threshold will also remain the same. The annual average
increase in the projected per employee cost will remain at 5.7% in Fiscal Year 2004 and
at 5.7% in Fiscal Year 2005. This success sharing formula will remain at 20% of the
projected costs in Fiscal Year 2004 .and at 20% of the projected costs in Fiscal Year
2005. I recommend the Amendment to the Joint Labor Management Health Care
Committee be approved. The requested action is for the City Council to approve a
motion approving the Amendment to the Joint Labor Management Health Care
Committee.
If you have any questions, please feel free to call.
RP:bf
cc: Health Care Committee
AMENDMENT TO THE
AGREEMENT
FOR
JOINT LABOR/MANAGEMENT HEALTH CARE COMMITTEE
CITY OF DUBUQUE
The undersigned hereby agree to extend the terms of the "Agreement for Joint
Labor/Management Health Care Committee" through June 30, 2005.
Signed this __ day of ,2003.
Amalgamated Transit Union,
Local #329
City of Dubuque, Iowa
Teamster's Union, Local #421
International Union of Operating
Engineers, Local #758
Appendix 2
(Continued)
Projected per Employee Costs: *
Success Sharing begins at: *
FY
2003
6383
5044
FY FY
2004 2005
These figures will
be added as the
information becomes
available.
AGREEMENT FOR JOINT LABOR/MANAGEMENT
HEALll~ CARE COI~4II-[EE
CIl~ OF DUBUQUE
WHEREAS~ the City of Dubuque offers a program of group health care
coverage to its employees and.their dependents through a self-funded
arrangement; and
WHEREAS, the cost of the health insurance program has been escalating.
rapidly to the detriment of the citizens of the City of Dubuque and all of the
participants in the Plan; and
WHEREAS, a consensus has been reached.among the City of Dubuque, the
certified public employee bargaining units and'their exclusive bargaining
representatives, and City employees not'represented by a b~rgaining unit, that
a Joint Labor/Management Health Care Committee appears to be the most
effective method for dealing with the problem of maintaining quality health
care while controlling escalating costs.
NOW, THEREFORE, IT IS AGREED BETWEEN AND AMONG THE PARTIES TO THIS
AGREEMENT AS FOLLOWS:
1.
The parties to this Agreement are:
AMALGAI~ATED TRANSIT UNION, LOCAL #329;
CITY OFDUBUQUE;
DUBUQUE POLICE PROTECTIVE ASSOCIATION;'.
DUBUQUE PROFESSIONAL FIREFIGHTERS ASSOCIATION, LOCAL #353;
GENERAL DRIVERS AND HELPERS UNION, LOCAL #421; and
INTERNATIONAL UNION OF OPERATING ENGINEERS, LOCAL #758;
provided that in case of a bargaining unit, the bargaining unit
has at least one employee who is eligible for group health care
coverage.
Although non-represented employees of the City of Dubuque are non-
participants to this Agreement, it is intended by the parties that this
Agreement shall benefit such employe~s.
2. Each of the parties hereby agrees to the provisions of the Group
Health InSurance Plan (the Plan) attached hereto and incorporated herein as
Appendix 1.
3. The Plan shall continue in force as the City of Dubuque Group
Health Insurance Plan for a period of five years from July 1, 1996 to June 30,
2001, unless modified as provided in Paragraph 4. It is understood and agreed
that if any provision of the Plan is prohibited or limited bylaw or any
modification required by law, the necessary revisions to the Plan shall be
made as required by law. A decision to renew this Agreement shall be made by
October 15, 2000.
upon the unanimous agreement of all of the voting members of the Joint
Labor/Management Health Care Committee (the Committee) and approved, if
necessary, by the City Council of the City of Dubuque.
The provisions of this Agreement and the Plan may be modified only
5. Each of the parties represents that it has the full legal
authority to enter into and be joined by this Agreement.
6. Committee shall be the exclusive forum for dealing with non-duty
related health care issues under this Agreement and each of the parties
2
specifically waives any rights it may otherwise have under the Iowa Public
Employment Relations Act or otherwise to bargain over the subject of health
care insurance, or to impose other terms or to arbitrate concerning other
termsfor health care coverage or benefits.
(a) The Committee shall be composed of 7 voting members appointed
by the parties and up to 15 non-voting members appointed by the
parties.
{b} Each of the bargaining units which are parties to this
Agreement shall appoint 1 of their members to be voting members;
and shall appoint up to 2 of their members to be non-voting
members; .'
{c) The City Manager shall appoint 2 employees to be voting
members, 1 as representative of Management and I as representative
of non-represented employees, and shall appoint up to 4 employees
as non-voting members;
{d} The committee shall appoint 1 City of Dubuque retiree as a
non-voting member;
(e) The parties to this Agreement' Shall each appoint alternates,
from the committee, who shall have the power to cast a vote in
absence of the voting member.
{f) A Member of the Committee shall be appointed for a term of 5
years unless sooner replaced by the party appointing the member.
Recognizing the need for stability in the Committee, each of the
parties and participating groups agree insofar as it is practical
to maintain the same representatives on the Committee for the term
of this Agreement. If it becomes necessary to replace a
previously designated representative, such party shall notify the
co-chairs of the Committee in writing as soon as practical 'and not
less than 5 days prior to any regular Committee meeting.
(g) The Committee shall determine its. own internal structure and
operating procedure, including arrangements for subcommittees and
the co-chairing of the Committee and subcommittees. The co-
chair(s} representing Labor shall be selected by the voting
members appointed by the bargaining units and the co-chair(s)
representing Management s-hall be selected by the voting members
appointed by the City Manager.
{h) The committee shall meet on a regular basis not less than
quarterly and more frequently if needs require, Additional
meetings may be called as necessary at the direction of co-
chair(s), and written upon demand of any three Committee members
submitted to the co-chair{s).
(i} Employees shall be granted time off work to attend committee
and sub-committee meetings and be paid at the appropriate rate
when attending committee and sub-committee meetings 'during off
duty hours.
~a) The parties agree that any dispute concerning the
interpretation or application of this Agreement between any two or
more of them which cannot be resolved after good faith efforts'
shall be submitted to binding arbitration. It is understood that
this provision for arbitration shall not apply to any dispute
arising out of the operation of the Plan itself or to any
individual claims or disputes under the Plan.
(b) The parties to the dispute, by joint letter, shall request
that the Federal Mediation and Conciliation Services (FMCS) submit
to them a list of seven (7) arbitrators. The parties~ shall meet
within ten (10) days of receipt of the list and engage in mutual
striking to select an arbitrator. Each party shall have the right
to reject one entire list, provided such rejection occurs within
five (5) days of receipt of the list. The parties'shall
alternatively strike one name from the list until there is one
name remaining. The order of striking shall be determined by ~oin
toss. The Selected arbitrator shall be notified by joint letter
of the parties, requesting that a hearing be scheduled in Dubuque,
Iowa, on a mutually agreed date.
(c) The parties to the dispute attempt to arrive at a joint
stipulation of the facts and issues shall be submitted to the
arbitrator. Both parties shall have the right to request the
arbitrator to require the presence of witnesses and documents.
Employees of the City called to testify at the arbitration shall
be released from duty for such purposes without loss of pay or
benefits.
(d) The arbitrator shall have no authority to amend, modify,
nullify, ignore, add or subtract from the provisions of this
Agreement. The arbitrator shall consider and decide the issues
presented.and provide for an appropriate remedy. The arbitrator's
decision shall be rendered and delivered in writing to the par'ties
within thirty {30} days of the close of the hearing or the
submission of post-hearing briefs, whichever is later. Post-
hearing briefs shall be filed simultaneously by the parties on a
date established by the arbitrator.
(e) Fees and expenses of the arbitrator, the cost of the hearing
room, and the cost of a court reporter to provide a written
transcript for the arbitrator shall be shared equally by the
parties to the dispute. If either party desires a verbatim record
of the proceedings, the party shall pay for the cost of such copy.
9. The parties to this Agreement, in consideration of their mutual
undertakings and obligations, mutually agree that during the term of this
Agreement, a collectively bargained agreement between and among all of the
parties, no provisions concerning the Plan, including but not limited to its
cost and benefits, shall be raised as an issue in any other collective
bargaining agreement, contract or negotiations between the parties and the
City of Dubuque. It is further understood and agreed that this Agreement does
not represent a collectively bargained agreement between the City of Dubuque
and its non-represented employees.
10. Fifty percent of the savings obtained through the efforts of the
Committee shall be applied to health care related issues. The Committee,
within its authority, and within established budget policy gu. idelines, shall
6
decide how the savings shall be applied to health care issues. "Savings"
shall mean the difference between the goal established by the Committee and
the actual costs associated with the provision of health care as defined in
Appendix 2 attached. In the event the health insurance reserve is higher than
necessary, as determined by an actuary or an underwriter, the difference
between the reserve amount and the actuarial or underwriting determination
shall not be considered in determining savings. The health insurance reserve
shall not fall below the amount determined as appropriate by an actuarial or
underwriting analysis.
11. It is understood and agreed that,' the City of Dubuque,'being a
municipal corporation, this Agreement and all actions, procedures and
processes under this Agreement shall be subject to all of the statutes and
ordinances governing the conduct of municipalities, including but not limited
to requirements for bidding and contracting for the provisions of goods and
services, and compliance with all legal provisions for equal employment
opportunity and affirmative action applicable to the City or any other party.
Signed this ~-~]day of , 1996.
AMALGAMA~TE ~T~NSIT UNION, LOCAL ))329
C I,~OF DUBUQUE
DUBUQUE PROFESSIONAL FIREFIGHTERS
ASSOCIATION, LOCAL #353
/
GENERAL DRIVERS AND HELPERS UNION,
LOCAL #421
ENGINEERS, LOCAL #758
APP~qDIX 2
city of Dubuque and its Unions Health
Insurance Task Force
Success Sharing Formule Results
Formula: 50% success sharing begins in SYt996~
of the projected cost increase in the second year, 60%
of projected in the third year, 40% Of projected in fourth
year, 2.0% of projected in the fifth year.
Illustration of Results with Alternative Assuaned Costs Scenario
(Assumes 500 active employees throughout the 5 years)
Method C (5.7% averaqe annuel increases)
1996 1997 1998 1999 2000
Projected per
employee costs:* $4,330 $4,577 $4,838 $5,113 $5,405
Success sharzng
begins at:
$4,330 $4,528 $4,683 $4,790 $4,845
4% assumed costs
scenario:
city share:
Employee share:
$4,261
$17,250
$17,250
$4,431 $4,609 $4,7~3 $4,985
$24,250 $18,500 0 0
$24,250 $18,500 0 0
3% assumed costs
scenario:
city share:
Employee share:
$4,220 $4,347 $4,477 $4,611 $4,749
$27,500 $45,250 $51,500 $44,750 $24~000
$27,500 $45,250 $51,500 $44,750 $24,000
2% assumed costs
scenario:
City share:
Employee share:
$4,179
$37,750
$37,750
$4,263 $4,348 $4,435 $4,523
$66,250 $ 83,750 $ 88,750 $ 80,500
$66,250 $ 83,750 $ 88,750 $ 80,500
These figures include medical (inda-mity and I-MD) and prescription drug
claims and stop loss pr~niu-ns and ad-ninistration fees for the medical
(indu,,,ity and}BID) and prescription drug plans.
3
AMENDMENT TO THE
AGREEMENT
FOR
JOINT LABOR/MANAGEMENT HEALTH CARE COMMITTEE
CITY OF DUBUQUE
The undersigned hereby agree to extend the terms of the "Agreement for Joint
Labor/Management Health Care Committee" through June 30, 2002.
Signed this c~-/-~/' day of
?P~O~)~/amated Transit Union,
Local .'/329
· 2001.
City of Dubuque~ Iow/~
Dubuque Police~rotective
Assoc at on
Dub-u-~ue ~rofessional Fire '
Fighters Association, Local # 353
- T~#421
International U~n of Operating
Engineers· Local #758
Appendix 2
(Continued)
Projected per Employee Costs: *
Success Sharing begins at: *
FY
2001
5713
4910
FY
2002
6039
4975