On October 30, 2008, The Press of Atlantic City reported that new Ocean City, New Jersey Police Officers will make approximately $5,000 less under the contract that was recently approved by the PBA and city council. The contract with the Policemen’s Benevolent Association Local 61 also reflected a move to the state health-insurance system from the city’s own health system. The city has cited double digit increases in premium costs as the reason for moving from its own plan to the State Health Benefits Program. The city further stated that it plans to move all municipal employees to the state benefits program as soon as practicable.
The contract also reflected a 3.5 percent increase in salary for 2008, a 3.85 percent increase in salary for 2009, a 3.9 percent increase in salary for 2010 and a 3.8 percent increase in salary for 2011.
However where the contract strayed from the traditional path was the establishment of a two-tier pay system reflecting a cut in salary for new hires from $42,200 to $37,500. The contract also changed a longevity payment from a range of 0 to 12 percent to a flat dollar bonus based on years of service.
Presently contract negotiations with the city fire union have reached an impasse and are in binding interest arbitration.
We should take a few teaching points away from the settlement of this particular contract.
- First, I believe we will see a greater trend developing where municipalities will continue to move away from their own health plan system and opt into the State Health Benefit Program as a cost saving measure.
- Second, in today’s economy and with the poor self inflicted financial condition of the state of New Jersey, municipal aide is being cut which means less money for pay raises and benefits. The days of seeing 4% increases will be harder to come by in the immediate future. Furthermore, raises for 2008 will probably be less than the years that follow.
- Finally, it is interesting that the PBA agreed to lower the starting salary of new officers. While there may be a multitude of economic reasons for this decision, we should not speculate why this concession was made without understanding the dynamics of the department’s man power, Table of Organization, and the benefits conferred upon the members for making the concession.