AFSCME Attorney Alaine S. Williams was Featured in an Article in the Erie Times Regarding the Pennyslvania Labor Relations Board Rejection of a Proposed Plan
April 11, 2013
Pleasant Ridge Must Bargain in Good Faith on Pension, State Rules (Erie Times)
By Kevin Flowers
The Pennsylvania Labor Relations Board has rejected a plan that would have brought big changes to the pension plans of workers at Erie County's two nursing homes.
In a ruling issued this week, the PLRB sided with the American Federation of State, County and Municipal Employees union by charging that under long-standing state law, officials at Pleasant Ridge Manor needed to negotiate the pension changes with the nursing homes' employees.
Erie County Council, which also acts as the nursing homes' board of trustees, approved the changes. Pleasant Ridge had argued that its leadership had the unilateral right to revamp the pension plan, which is underfunded by more than $6 million.
But the PLRB ruled that pension plan changes, under Pennsylvania's Public Employee Relations Act, are a mandatory subject of collective bargaining and that Pleasant Ridge officials must "cease and desist from refusing to bargain collectively in good faith" with AFSCME over the pension.
"We're thrilled. We firmly felt the facts were in our favor," said Alaine S. Williams, an AFSCME lawyer from the Philadelphia law firm Willig, Williams and Davidson.
"I don't think there is any question that pensions are a mandatory subject of bargaining" when it comes to Pleasant Ridge Manor employees, Williams said.
Bob Smith, chief executive of the nursing homes, said that Pleasant Ridge officials plan to meet with County Council on Friday at 1 p.m. at the Erie County Courthouse to talk about what's next.
"We're going to talk about our options with the board and what we want to pursue," Smith said.
Smith was asked if he was disappointed with the ruling.
"Naturally," Smith said.
The Pleasant Ridge Manor pension has been a key component of discussions about consolidating the 312-bed Pleasant Ridge Manor-West, 8300 West Ridge Road in Fairview Township, and the 76-bed Pleasant Ridge Manor-East, 4728 Lake Pleasant Road in Millcreek Township.
The county's state-required yearly contribution to the pension plan for Pleasant Ridge Manor employees is roughly $2.4 million for 2013, according to county officials.
The pension's continued cost is a key reason why Pleasant Ridge officials sought to change the plan.
AFSCME filed an injunction in Erie County Court on Dec. 29, 2011, to stop implementation of the pension changes. The union also filed an unfair labor practices complaint with the PLRB.
The union, which represents about 350 employees at the two nursing homes, challenged County Council's approval of a "hybrid" pension plan that allows more than 150 of the nursing homes' employees who participate in the pension to continue accruing benefits.
Council approved that plan on Nov. 17, 2011.
For the other approximately 180 employees, pension accrual would have ceased. Those employees and others hired later could instead opt into a new 401(k) plan in which Pleasant Ridge would match, dollar-for-dollar, the first 3 percent of an employee's contributions.
County Council, which oversees the nursing homes, wanted the pension changes as part of a cost-savings plan aimed at consolidating the two nursing homes.
AFSCME claimed that union leaders negotiating a new contract with the county learned of the plan to change pension benefits via media reports.
The union argued to the PLRB that a 401(k) plan would provide an uncertain benefit to employees subject to the rise and fall of the stock market, rather than the guaranteed monthly benefit a pension provides.
Smith said that Pleasant Ridge management and the union have not started talking about negotiating the pension changes "because that would be premature until we have that conversation (with County Council) about our options."
Councilman Fiore Leone said his chief concern is "the long-term financial impact on the county" if the pension plan stays as is.
"We lose this case, and I don't know what the cost is going to be to us," Leone said.
Erie lawyer George Joseph, who represented Pleasant Ridge Manor in the case, said he could file exceptions challenging the PLRB's decision.
That is one of the options County Council will consider at Friday's meeting. Pleasant Ridge officials have until April 25 to file exceptions.
The county has moved forward with plans to consolidate Pleasant Ridge Manor-West with the smaller Pleasant Ridge Manor-East.
Those plans require millions of dollars in upgrades at the Fairview facility -- which are underway -- including new sprinklers and water system improvements.