The American Federation of State, County and Municipal Employees (AFSCME) union approved a one-year agreement with the city of Orchard Lake last month, a pact that calls for a slight wage reduction.
The City Council voted to approve the measure on Feb. 22.
“It was a cordial negotiation and, while painful for the employees, we appreciate their attitude,” said Mayor Bruce McIntyre. “These are loyal and hard-working people and, believe me, we take no pleasure doing this.”
The City Council endorsed a financial plan this month that calls for raising the city’s operating millage by 1 mill in May when the budget is established.
“If we ask the taxpayers for more, we expect employees to participate, as well,” McIntyre said. “This is not an unreasonable reduction. Things like this or more so are going on in other communities. If you look at the amount of revenue lost, it’s huge. We must take steps, more than already taken, or else we’ll be under water.”
The four employees impacted are support staff from the Department of Public Works and administration.
The contract, which expired Dec. 31, 2010, runs from Jan. 1 to Dec. 31. The 12-month agreement requires the employees to take a 2.5 percent pay cut.
“The salary level will return to the current level after one year,” said City Clerk Janet Overholt-Green.
However, the pay cut doesn’t take effect until agreement is signed by both parties. As of that signing date, it will be extended one year.
“Therefore it could extend beyond the contract expiration,” Overholt-Green said.
A provision also states that if the city tax base increases next year by any amount, the city will make a lump sum payment to each of the four AFSCME employees of $1,250.
The employees also agreed to work two holidays they formerly had off with pay — Good Friday and each employee’s birthday.
Moreover, the city changed retiree health care plans for anyone hired after Jan. 1, 2011. Currently, if an employee retires before the age of 65, the city continues to pay their health care benefits as if they are still employed. Now, the city will set aside dollars every pay period that will be directed into a health savings account so the employees receive a lump sum to pay for health care after they retire.
The language in the AFSCME contract is currently being reviewed and is expected to be signed within the next two weeks.