NM may owe $20M in back pay to state workers
SANTA FE, N.M. (AP) — About 11,000 state workers are entitled to retroactive pay increases because former New Mexico Gov. Bill Richardson's administration didn't follow union contracts in distributing money provided by the Legislature four years ago, the state Court of Appeals has ruled.
Republican Gov. Susana Martinez's administration plans to appeal this week's ruling and says it could cost the state $20 million for back pay to workers covered by union contracts. A lawyer for unions estimates a cost of up to $10 million.
The court's ruling means a pay raise for about half of the state's classified workers, which are those hired through a merit-based civil service system rather than a political appointment. The amount of the pay will vary from worker to worker, depending on an individual's job and their experience with government. Administration officials say it's uncertain the average amount an employee will receive.
At issue are pay raises for workers in agencies covered by collective bargaining agreements — both non-union members and those paying union dues.
Not all of state government is covered by union contracts and it varies from agency to agency. Among the agencies with union representation are the Corrections, Human Services, Transportation, and Public Education departments.
The court's 2-1 ruling, which was issued Wednesday, upheld two arbitration decisions that concluded the state was wrong in not following the terms of union contracts when it provided across-the-board 2.9 percent pay raises to all classified workers in the fiscal year that ran from July 2008 through June 2009.
The court ordered the state to provide back pay so that union-represented workers receive what was required under their collective bargaining agreements — raises ranging from 3 percent to 5.5 percent, depending on their job experience.
The Communications Workers of America and the American Federation of State, County and Municipal Workers filed separate grievances challenging the state's pay distribution.
Arbitrators determined it would cost the state about $8 million to follow contract terms for pay raises to union-represented workers, but nearly $16 million was necessary to give the same increases to all other state employees.
The Legislature had allocated $12.8 million for pay, determining that was enough for raises averaging 2.9 percent.
Under the state's collective bargaining law, pay raises negotiated by unions and a governor are subject to the Legislature's appropriations.
However, the court agreed with arbitrators that the state must first provide the contractually required pay increase to unionized workers because there was enough money to do that. Any money left over from the Legislature's appropriation could then be used to provide salary increases to other workers.
The state must provide the back pay even if it means going back to the Legislature for more money. The Legislature meets in January.
"There is no difference between this case and other cases where adverse judgments are rendered against the state; as in those cases, the state cannot avoid its obligation to comply with the judgment by maintaining that compliance would require it to seek further appropriation from the Legislature," said Judges Cynthia Fry and Jonathan Sutin.
The ruling drew a sharp dissent from Judge J. Miles Hanisee.
"It appears to me to be contrary to public policy for eligible state employees to be awarded substantially differing income increases for the performance of parallel public services, when that determination is based upon union representation and not upon merit," Hanisee wrote.
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