The High Cost of Union Busting

The following was originally posted on October 8.

In November of 2006, the Diocese of Scranton announced its plans to restructure its schools. That decision simultaneously brought closure to the old schools and the bargaining relationship that several of those schools had with their in-house unions, all of which were under the umbrella of the Scranton Diocese Association of Catholic Teachers (SDACT). The closures also triggered contractual provisions in some schools requiring that the employers pay teachers money owed them for accumulated sick leave and severance pay when their employment with those schools was terminated. Knowing this to be the case, the SDACT asked the employers how they intended to make good on their contractual promises, or how a workable compromise could be arranged through collective bargaining. When no responses to the union’s requests were received, grievances were filed for breach of contract.

Those grievances progressed through their contract’s grievance procedure, eventually reaching the final step of the process – binding arbitration. At three schools (formerly Bishop O’Hara, Seton Catholic and St. Nicholas-St. Mary’s) the employers agreed to pay their teachers this earned benefit promised by their contracts before any hearings took place.

Since May of 2008, separate arbitration hearings have taken place between the parties at the former Bishop Hoban, Bishop Hafey, Bishop Neumann, Bishop O’Reilly Junior High and Bishop O’Reilly Senior High. Dates for hearings are yet to be fixed for St. Vincent’s, Wyoming Area Catholic, St. Aloysius, St. Jude’s and St. Paul’s.

On September 3, 2008, the first arbitration award was handed down, that affecting Bishop Hoban. SDACT and the teachers were the winners in the dispute. The arbitrator’s award called for the employer to immediately begin paying out $725,000 to Hoban’s 40 teachers. Moreover, there is every expectation that when the dust finally settles and all of the arbitrators have ruled, the Diocese may owe nearly two million dollars ($2,000,000) to the teachers in the 12 affected schools.

This immediate payout (and the enormous associated legal costs) will no doubt have an unfavorable impact on the Diocese and its schools. It is just one more foreseeable and avoidable consequence of a reckless policy of union-busting initiated by Bishop Martino and his advisors. When word of such financial malfeasance reaches parishioners, no doubt, as it has done so often before, the Diocese will soon attempt to spin this outcome to make it a demonstration of the union’s “greed” or the dangerous effect a union would have on the schools. This type of spin would, of course, be far from the truth.

The fact is that what was designed as a small benefit per individual employee, if properly applied under a union contract in the new school system, would have had a nearly negligible financial impact as individual teachers left the employment of the Diocese through retirement or attrition. (It must be noted, that such provisions were cooperatively designed to benefit both parties, and took their shape in negotiation as much from employer input as from the union.)

To illustrate the point, all one needs to do is to see how these provisions worked under the old union contracts in place before 2007. That is, each year, on average, a small number of teachers would retire. Those teachers were entitled to cash in the sick days that they had banked or receive severance pay – a benefit designed to augment their insufficient 401K retirement plans, and to help defray the cost of medical insurance in retirement. Viewed as an individual budget item at each school, the amount was very small and easily absorbed, as new teachers hired to replace retiring veterans came onboard at much lower salaries. In most cases, the employer would have come out ahead in this transaction. However, by its actions, the Diocese upset this agreed-upon balance by now making an expense that would have been allocated in dribs and drabs over a number of years immediately due and owing.

This situation did not have to be. This immediate and extremely large payment is a direct cost of union-busting. Bishop Martino and his advisors should be held accountable by the parishioners of the Scranton Diocese for such financial recklessness. Had the Diocese been willing to honor the Church’s own teachings by recognizing the union chosen by its own employees, the parties could have met to negotiate a new contract that would have defrayed these costs and allowed for a result in the best interests of the employer, teachers and, most importantly, the students and parents served by the schools.

The Diocese will no doubt claim that it was willing to carry over teachers’ sick days in question to the newly established schools. Never, however, were Diocesan officials willing to abide by the original contractual conditions governing payment for the sick days teachers had already earned over the course of decades of service. Nor, of course, were they willing to place language preserving the right to these earned benefits in a legally-enforceable union contract.

So, when the Diocese inevitably smears SDACT and all unions as greedy and self-serving, one only has to ask these questions: Was it SDACT or the Diocese that sought to provide a modest retirement benefit that corresponded directly to a teacher’s years of dedicated service; one which as contractually provided, would have been fiscally responsible? Was it SDACT or the Diocese, that, in a reprehensible attempt to subvert Church social justice teachings, placed an unnecessary financial burden on the community of faithful Catholics? The answers, sadly, are very clear.