Montgomery County government employees will not receive wage increases for a fourth consecutive year under a contract agreement between union and county officials.
Instead, all employees will receive a bonus — $2,000 for full-time employees and that amount pro-rated for part-time employees — soon after the contract is finalized. Employees who have been with the county for 21 years will receive a 3-percent increase.
The three-year contract also includes a promise by the county to consider a shift for some employees from a 401(k) plan to a more desirable “hybrid” plan that is half-pension and half 401(k).
| Contract details |
| The three-year contract with the Municipal and County Government Employees Organization includes: |
| • A $2,000 bonus for all full-time merit employees, pro-rated for part-time employees |
| • 3-percent increases for employees who have worked for the county for 21 years |
| • A promise to consider shifting employees toward a hybrid pension plan |
| • An opportunity to renegotiate wages for fiscal 2014 and 2015 |
Wages could be renegotiated for fiscal 2014 and 2015 if the county’s finances improve, said Gino Renne, president of the Municipal and County Government Employees Organization, a branch of the United Food and Commercial Workers International Union.
Members of the county’s largest union, which has about 7,000 members, and the County Council must approve the agreement before it can be finalized.
The county is anticipating a $135.4 million budget gap in fiscal 2013, assuming no employees in the county government, Montgomery College, Montgomery County Public Schools or the Maryland-National Capital Park and Planning Commission get raises, county officials said in December. A step increase for all county employees would cost $31.4 million, and every 1-percent cost of living increase costs $23.6 million, according to County Council Staff Director Steve Farber.
Given the county’s current fiscal situation, Renne said he was happy with the bonus, at least for now. “For FY ’14 and ’15, our hope — everyone’s hope — is that the county’s revenue resources will improve and people will start receiving regular raises again.”
The union also proposed changes to the employees’ pension plan, though those changes have not been negotiated, said county Human Resources Director Joseph Adler.
About 2,300 MCGEO employees are on a defined benefits plan that costs the county $30 million a year. Just under 2,200 MCGEO employees are on one of two 401(k) plans that cost the county $10.7 million annually.
The hybrid plan proposed by MCGEO officials would guarantee a minimum 5-percent annual return on employees’ retirement funds that would continue after they retire, Adler said.
Typically hybrid plans are more costly to employers than 401(k) plans, but the union’s actuary insisted that the proposal would not cost the county more than current plans, Adler said. The county would not shift to a hybrid plan if it costs more.
The county is still in negotiations with the Montgomery County Professional Fire Fighters over union members’ wages and benefits, according to union President John Sparks. Though the Fraternal Order of Police lodge 35 has completed negotiations with the county, union Secretary Jane Milne said she could not reveal the details before the union members have ratified the contract. Historically, the public safety unions follow MCGEO’s contracts.
