Should comparing public and private sector employees be legal in contract talks?
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As state and national economies continue to struggle, more and more claims have been made in recent years that taxpayer-funded public employees are paid too much, pay too little for health insurance and have handsome pensions compared to many in the private sector.
There is no dispute, says Peter Fisher, research director at the Iowa Policy Project in Iowa City, that there has been a “campaign across the country” the last couple of years to portray public workers as overcompensated, a campaign which he says has been fueled by conservative businesses, individuals and think tanks.
“And I think it’s been pretty successful,” Fisher says.
The Iowa Public Employment Relations Act states that Iowa’s public-sector employers and bargaining-unit employees “shall” compare the wages, hours and conditions of employment of their past contracts and the contracts of “other public employees doing comparable work” when public-sector employers and employees negotiate new contracts.
Since the mid-1970s, that language in the state law by and large has resulted in the exclusion of private-sector compensation comparisons during public-sector contract negotiations in Iowa.
What do you think of the law as it stands? Should negotiators be able to compare public- and private-sector workers when working out contracts for public employees?
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Regardless of the law, such comparisons are being done- but are they are being done in such a manner as to support an argument instead of in an evenhanded fashion? For example, is the entire compensation package- base pay plus benefits- taken into account or do the “negotiators” insist on comparing apples with oranges?
Presumably, public and private workers can move between the two realms of thei own volition so a compensation comparison is entirely appropriate during labor negotiations- provided that it is done fairly and not distorted by either of the parties.
Of course, they should be able to compare public sector jobs with private sector jobs. Both sectors are competing for employees from the same pool.
However, it needs to be a fair comparison. The structure of the compensation in each sector differs. One needs to look at the value of the whole package of compensation (salary, health insurance, potential bonuses, potential stock options, pensions, etc.).
One component of the package is particularly hard to value – security level. In general, compensation in the private sector is more volatile. It can go up and down more depending on company performance. Also, the risk of layoffs is usually higher. Public sector employees should accept a little less in compensation since their security level is higher.
I think it should be illegal not to compare them. You need all information at hand when making decisions like this. To purposely not take private compensation into account is just wrong.
Comparing public and private sector compensation packages should not only be allowed; it should be required. Public sector unions like to boast privately that they elect their own bosses with campaign contributions etc.; public sector unions are at both sides of the bargaining table. The compensation of public sector employees should be comparable to the compensation of those supporting them.