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Latest News - February 2013

February 22, 2013
Jerry Brown's labor secretary counters union attack on pension reform
Source: The Sacramento Bee
By: Jon Ortiz

With billions of dollars at stake, Gov. Jerry Brown's administration has defended the public pension legislation he signed last year from public unions' charge that it violates federal law.

Brown's labor secretary, Marty Morgenstern, told federal officials that the new pension law doesn't diminish mass-transit workers' collective bargaining rights, a prerequisite for mass-transit providers to receive federal grants.

"My legal staff and I have reviewed this matter carefully," Morgenstern wrote in a letter to Acting U.S. Labor Secretary Seth Harris last week, and concluded the law "merely modifies" the public pension plans that state and local government employers can offer.

California's Public Employee Pension Reform Act caps benefits, hikes employee contributions and offers less generous formulas for workers joining a state or local pension fund this year and later.

Unions representing roughly 20,000 mass-transit workers statewide contend retirement benefit terms must be negotiated, not imposed.

That has put mass-transit agencies around the state at an uncomfortable juncture: They must conform to the state law, but federal law requires mass-transit providers to preserve their employees' existing collective bargaining rights as a condition of receiving grants.

The U.S. Labor Department certifies compliance with the collective bargaining rule. After unions filed complaints with the department last fall, the federal government withheld the grants while all sides sort out the issue.

Harris asked for the administration's take, prompting Morgenstern's letter.

An Assembly bill introduced last month would exempt mass-transit workers from new pension standards. The administration opposes excluding employees, Morgenstern said in an email sent by a spokeswoman.

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