Item B
Suzanne A. Hutton, County Attorney**
Robert B. Shillinger, Chief Assistant County Attorney *
Pedro J. Mercado, Assistant County Attorney
Susan M. Grimsley, Assistant County Attorney**
Natileene W. Cassel, Assistant County Attorney
Cynthia Hall, Assistant County Attorney
Christine Limbert-Barrows, Assistant County Attorney
('.',.-.......-.-
O.\(~,rY ~2!:!~~E
(305) 294-4641
BOARD OF COUNTY COMMISSIONERS
MayorCharles McCoy, District 3
Mayor Pro Tern Mario Oi Gennaro, District 4
Commissioner Dixie Spehar, District 1
~ !\ Commissioner George Neugent, District 2
'; Commissioner Sylvia Murphy, District 5
Office of the County Attorney
PO Box 1026
Key West, FL 33041-]026
(305) 292-3470 - Phone
(305) 292-3516 - Fax
** Board Certified in City, County & Local Gavt. Law
TO:
DEBBIE FREDERICK, ACTING COUNTY ADMINISTRATOR
FROM:
CYNTHIA L. HALL, ASSISTANT COUNTY ATTORNEY
THRU:
SUZANNE A. HUTTON, COUNTY ATTORNEY
DATE:
FEBRUARY 3, 2008
RE:
COMPARISON OF RAMIFICATIONS OF SALARY REDUCTIONS
(FURLOUGHS) VS. REDUCTION IN FORCE (LAYOFFS) TO MEET
BUDGET NEEDS
You have requested a comparison of salary/workweek reductions (furloughs) versus
layoffs (reduction in force) as a means of cutting payroll in order to meet budget needs. In
general, the County has the exclusive management right to implement either method for County
Service (non-union) employees and Teamsters employees. The County has the management
right to layoff employees covered by the IAFF agreement but not to reduce salaries unless the
reductions are bargained for. Furloughs are less likely to produce significant cost savings.
Layoffs are more likely to produce significant cost savings but will also require immediate
payout of accrued sick and annual leave as to some employees. Either may trigger appeals or
grievances. Additional ramifications are discussed herein.
Overview
All County's employees other than those covered by Teamsters Local Union #769 and
IAFF Local 3909 bargaining units are defined as "County Service". The terms and conditions of
their emplOyment are set by the Monroe County Personnel Policies & Procedures Manual
("Manual").
In addition, the County has two groups of employees covered by collective bargaining
agreements (CBA): Teamsters Local Union # 769 (covering many employees in the Public
Works division and some transportation employees) and IAFF Local 3909 (covering firefighters,
airport shift captains, battalion chiefs and fire rescue captains). The Teamsters CBA is in effect
through September 30, 2009. The IAFF CBA is in effect through September 30, 2008.
A. Management Authority To Lay Off Employees Or Reduce Work Week
1. County Service Employees
The County has the exclusive management right to order either layoffs or a reduction in
work week for County Service, Teamsters and IAFF employees, provided it does so by following
the rules in the Manual or the applicable CBA.
Paragraphs 4.12 and 11.02 of the Manual give authority to the BOCC to lay off County
Service employees as necessary for budgetary reasons. Paragraph 4.12 of the Manual specifically
states that all employees are placed on notice that the payment of salaries is always subject to the
availability of funds. Paragraph 11.02 of the Manual states that the County Administrator/Board
of County Commissioners may layoff as many employees as required after two weeks notice if
layoffs are necessary because oflack of work, shortage of funds, for reorganization "or for other
legitimate fI~asons." The Manual further provides that no regular employee shall be laid off
while there are temporary or probationary employees serving in the same class I the same
department.
Paragraph 5.0 I of the Manual likewise gives the County the latitude to achieve a budget
reduction through reduction of a workweek with corresponding reduction in salary. Paragraph
5.01(A) of the Manual states that County departments must operate between 37.5 and 40 hours,
unless authorized in advance in writing by the County Administrator. Paragraph 5.01(C) states
that employ'~es hired after May I, 1991 must work a 40 hour work week "unless otherwise
determined by the County Administrator." The implication of both provisions is that the County
could reduce work weeks to 37.5 hours or below.
2. Teamsters
Paragraph 7.1 of the Teamsters CBA gives broad exclusive rights to management
including the right to determine layoffs, to "abolish or change existing jobs," to "schedule the
hours and days to be worked," to expand or reduce any department or operations for business
purpose, and generally "to manage the County" or direct the work force and establish terms and
conditions of employment. The language gives the County the right to make these changes
without further bargaining.
3. IAFF
Base salaries for each position covered by the IAFF CBA are spelled out in Article 8 of
the CBA. A work week is defied in Article 2 of the CBA, and layoffs are covered in Article 6 of
the CBA. Therefore, any decision that would result in a change to salary or to the definition of a
work week would require bargaining to change the current CBA.
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B. Employee Rights To Appeal or Grieve Decisions
1. County Service Employees
Probationary and temporary employees have no right of appeal of any decision (layoff or
furlough). Career service employees have a right under Section 4 of Chapter Law 69-1321 to
appeal any decision involving discharge or reduction in pay to the Career Service Council.
Because th,~ employer has an exclusive right to control its work force and in particular to make
economic decisions for budgetary reasons, while any decision could be appealed by the
employee, the only argument that should prevail would be one supported by proof that a decision
was made for a discriminatory (non-economic) reason.
2. Teamsters
Paragraph 24.2 of the Teamsters CBA states that any employee may grieve any "claimed
violation of any express provision" of the agreement using the 5-step grievance procedure
outlined in the agreement. Paragraph 25.5 of the CBA spells out the procedure for layoffs. Thus,
an employee covered by the CBA who believe that the employer has violated the CBA may
appeal the decision through the grievance process. Because there is no express provision in the
CBA regarding salary or length of work week (and in fact the Teamsters CBA gives exclusive
right to management to determine this), a grievance based on acclaimed violation in layoffs is
more legitimately covered by the CBA than a grievance alleging a violation in a reduction in
workweek or salary.
3. IAFF
The IAFF CBA defines a grievance as a complaint, dispute or controversy in which it is
claimed that the County has failed in an obligation under the agreement. Any change to the
salary laid out in Article 8 and Exhibit B to the CBA, to a benefit promised in Article 9 of the
agreement, or any layoff that did not follow Article 6 of the CBA could and we should expect
would be grieved in accordance with the procedure laid out in Article 5 of the CBA (4-step
process, culminating in binding arbitration through the Federal Mediation and Conciliation
Service).
C. Payout of Accrued Sick and Annual Leave and Other Benefits
Layoffs of any employees would trigger payout of accrued sick and annual leave for
County Service, Teamsters and IAFF employees and entitle the employees to unemployment
benefits.! Reduction in work week would not trigger payout of sick time or accrued annual leave
and employe:es whose salaries are reduced as part of a furlough program are not entitled to
unemploym(~nt benefits.
Emplloyer contribution to FRS would continue in the case of employees subject to a
furlough, bull would not continue in the case of employees subject to a reduction in force.
1 County Service and Teamsters employees receive a prorated amount of sick leave ranging from Y4 of sick leave up
to a maximum of 30 days for employees with 5-10 years of service to 12 of accrued sick leave up to 120 days for
employees with 15 years or more of service. Teamsters employees have the option of leaving the sick leave on
account for up to one year.
3
D. Malgnitude And Length of Effect Of Furlough v. Reduction In Force (Layoff)
Specific dollar figures for the relative fiscal impact of furlough (reduction in work week)
vs. reduction in force (layoff) must be obtained from either Human Resources or the Office of
Management and Budget. However, in general terms, any furlough (reduction in work week)
will achieve a financial savings equal to approximately the percentage of time deducted from the
work week plus 40% of that percentage (the additional value of the benefits, i.e., the "load"
factor). So, for example, if the work week were reduced from 40 hours to 37.5 hours for those
employees whose work week could be reduced without bargaining (i.e., excluding the IAFF), the
maximum annual savings would be approximately 8.75% of current payroll (6.25% x 1.4) (the
actual savings County-wide would be slightly less, because no IAFF employees could be
included).
The County can achieve the same cost savings either through a reduction in work week
(furlough) or reduction in force (layoff). However, it is much more difficult to achieve high cost
savings through furlough. For example, to achieve a 20% annual savings in bottom line payroll
through furlough, the County would need to reduce its work week by almost 15%, equivalent to
changing from a 40 hour work week to a 34 hour work week. In this case, because we are almost
one third of the way into the fiscal year, the County would need to reduce its work week for the
balance of this fiscal year by over 20% in order to achieve an annual savings of 20% of payroll
loaded.
If the projected need of the County were short-term, then furloughs are more
advantageous, because it allows the County to retain its work force and imposes a short-term
effect on the employees. However, ifthe County's need is to reduce its payroll on a long-term
basis, then a reduction in force yields a permanent reduction in payroll costs. Nothing in the
Manual or either of the two CBAs prevents the County from using a combination of the two
methods simultaneously.
E. Layoff, Bumping and Re-Hire Rules
1. County Service
The Manual provides that the County Administrator/BOCC has the authority to layoff as
many employees as required after two weeks' notice. There is no appeal other than the internal
grievance proceedings. No regular employee can be laid offwhile there are temporary or
probationary employees in the same class in the same department. Laid off employees are given
priority of n:-hire for the same position, based on seniority and previous performance
evaluations, for a period of time length to their continuous service up to one year. The
employees are also eligible for promotional opportunities for a period of one year after date of
layoff.
2. Teamsters
Undt:r the Teamsters CBA all temporary and probationary employees are terminated first,
except if the employee has a "particular skill required to perform certain duties and no one else
employed by the County is qualified." Permanent employees are laid off based on length of
continuous service, "provided that the employees who are retained have the demonstrated ability
4
and fitness to perform the available work." Laid off employees are eligible for recall into
positions previously held by the County or for which they are qualified for three years from the
layoff.
3. IAFF
IAFF employees must be laid off in the following order: Temporary/part-time/trainee and
seasonal employees, followed by probationary and non-permanent full-time employees, then full-
time permanent employees, to be laid off on the basis of their classifications within ranks.
Classifications or ranks to be laid off shall be determined by the County in the sole exercise of its
management rights. Employees who are covered by the CBA do not have bumping rights as to
any other position in the County and employees who are laid off from any other department or
division do not have bumping rights to any position covered by the CBA. Employees covered by
the CBA have the right to bump down into the next lower rank. Persons who are laid off go onto
a rehire list and no person not on the list may be hired until the rehire list is exhausted, for a
period of two years, unless no person on the list is qualified or no qualified person accepts the
job.
F. Application of Furlough To Exempt Employees
Exempt employees are those employees exempt from (not subject to) the federal Fair
Labor Standards Act, which defines the maximum working hours and minimum wage for
employees. Employees who are considered "exempt" are paid a salary (rather than an hourly
wage), and their salary is by definition not dependent on numbers of hours worked in a week.
The federal Department of Labor has stated that exempt employees can be covered by furloughs
or pay redudions. However, in the week in which the salary is reduced, the employee is treated
as a non-exempt employee, i.e., the employee can only be required to work the reduced number
of hours, and any work in excess of those hours would entitle the employee to overtime, the same
as with any non-exempt employee.
G. Oth,er Considerations
The Manual, the Teamsters CBA and the IAFF CBA are three separate documents with
three separate sets of terms and conditions. Each collective bargaining agreements was
bargained for separately. Thus, each CBA includes wage and benefit conditions that are in some
cases arguably more generous or less generous than the wages and benefits given to County
Service employees, but most importantly, different. For example, the Teamsters and IAFF
employees each received a 3% cost of living allowance at the beginning of each fiscal year
covered by their CBA, whereas County Service employees did not receive a COLA in the past
fiscal year. The two collective bargaining agreements apply only to their respective bargaining
units. The bargaining units have no right to impose terms and conditions ofthe CBA on County
Service employees or employees covered by the other collective bargaining agreement.
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Page I ofl
From: MJ Matthews [mmatthew@fau.edu]
Sent: Friday, FebrualY 16, 2007 3:33 PM
To: Julia Trevarthen
ec: 'Lenore Alpert'; c:obrlen9@fau.edu
Subj,ect: possible conI call on Tuesday?
Importance: High
Dear Julia,
We just had a good meeting with Jim on the Monroe County status and No Net Loss direction from
Commissioner Neugent.
Jim would like a conference call on Tuesday, Feb. 20th, anytime!mt 1:30 - 2:30 pm, with you/RPC,
Rich/George Garrett/Jose from Monroe and us so we can start planning the materials needed (and
direction from staff) for the March 21st meeting.
Rich is hoping to get a PowerPoint (for the Commissioners) from us by Feb. 26th so we11 need to get
more direction from staff asap. We're hoping something can be set up for Tuesday.
If you need any assistance in this regard, just give a holler!
Thanks and TTYS,
MJ
954-762-5286
11/1112007
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Page 1 of 1
::7'i:il" ]J
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From: Jones-Rich [Jones-RICh@MonroeCounty-FL.Gov]
Sent: Monday, April 30, 2007 2:18 PM
To: Julia Trevarthen
Co: Richard Ogbum; Garrelt-George
Subjet:!: Hey
Hey gUYli:
I had a working lunch today with Comm. Neugent, Bruce Popham, Sherry Popham (a planning commissioner)
and Gary Graves (fish house manager).
I could tel" immediately that either they don1 understand the ordinance or haven't read It. Gary Graves thought
we shouldn't be restricting anything. Bruce Popham wants 100% no net loss. I expIelned to all of them that the
ord currently would restrict 50% working waterfront and provides the Incentive to go 30% or more above the 100%
intensity limit. They don't seem to grasp it, at least not at first. They didn't realize that wa already have language
to transfer to another sile, pay into a mitigation fund, go from one working waterfront to another, etc. They only
see the 50% restriction. Gary asked what happened after the first meeting, he never heard of another meeting.
Bruce feels that it should be no netlosa. He also says that many boatyards are not at capacity and we may not
need all 01' them (yes, tie contradicts himse/t). He and Sherry would like us to analyze the needs at every facility,
the number of slips, the economics, etc and base an ordinance on all the above. I am not sharp enough to
understand how you would begin to craft something like that, much less generate the datal
Bruce and Neugent said we should be providing options. I reminded them that we had done that months ago and
at least an element of the Board shot that down. The main thing is Neugent wants this all explained at an
elementelJ' level so that all parties understand. He wants to see visual aids to help them understand. Sherry
advises to emphasize the incentives, ele.
At the mee~ng (WedneSday at 6:00 pm) we need to touch on:
The meetings with stakeholders that we have conducted
The, reasons why no net loss won1 work In the Keys
Wh!f a percentage Is a better way to go than no net loss
The Incentives that make this whole thing workabla for the property owner
How this Is not attached to an land use district, but rather applies across the board
I've attached a little write up I did for a model slte, Indicating that It's an example of redevelopment under the LOR
ordinance. I think some examples would go a long ways.
Rich
11/1112007