BUSINESS AGENT’S COLUMN

By Ric Casilli

MEDICAL COST INCREASES NEED FREEZING

IN GECONTRACT 2015

NOTE: I want to thank our members for the support in the recent election .It was greatly appreciated. The following is the 6th column printed in a continuing series for educational article I am writing regarding the upcoming 2015 National Contract Negotiations. These articles represent my opinion on issues as Business Agent of Local 201 and as a member of the national IUE-CWA Bargaining committee. Our National Committee will not set our official bargaining proposals until January 2015 after membership surveys are completed and tabulated. These articles are meant to be an educational tool so our members better understand and think about key issues that are likely to be on the bargaining table come May and June of 2015.

The GE Health Benefits Plan for Production Employees coversall our enrolled members working, young or older, and all pre-65 retirees. Members are in one of 3 Options.

Everyone is aware, that in every Contract for over the last 20 years, GE has come to the negotiating table with proposals to double or triple the amounts we pay for health insurance. And we all know what they just did to us last contract putting us in this GE Health Benefits Plan for Production Employees “modeled” after their consumer driven high deductable high employee cost “GE Health Choice” Plan they had earlier put their non-union salaried employees in. Despite our hourly production medical plan having some better negotiated rates in three areas than the salaried plan, this 2012 new health care plan was one of the 3 main reasons Local 201 members voted to reject the last 2011 Contract (the other 2 reasons were the elimination of the Defined Pension Plan for new hires and the take away of full SERO Benefits for substitute volunteer in layoff situations.)

Over the years,the Union has fought back and dampened the size of medical cost increases significantly and our rates finally were frozen for this coming 2015 year in the 2011 negotiations. (Actually go down slightly with the lowering of Health Care Reform tax). However, this badly designed plan’s negotiatedcontribution rates went up significantly during 2013 and 2014. Therates vary depending on which of option you are in, how many dependents you cover, and how much your normal (40 hour week) annual salary is. As you can see, “built in” into the current plan design are employee medical cost increases by just moving into a higher wage band (wage increases, upgrading etc) and there are extra penalties“built in” for having more dependents, using tobacco (in 2015) and with the working spouse penalty that goes back many years. Few members like this new high deductable consumer driven Health Care Plan

The only thing that may make this Medical Plan livable for another 4 years would be to freeze the wage band contribution tables, annual deductibles, co-insurance maximums; out of pocket maximums; prescription drug co-pays and increase the annual Company HRA amounts to members for all 3 medical options. In addition, eliminating the extension period of one’s medical coverage while on disability was a cruel take-away last contract and this extension period needs to be restored..

PRE-65 RETIREES GET REALLY SCREWED

(IF YOU ARE AN R21 OR HIGHER)

If you think the medical contribution rates are high for active working members (which they are), think what you will pay if you become a pre-65 retiree. You would pay in most cases the same rates with a reduced fixed pension income and no contractual pay increases to help offset the increases; and is not even eligible for flexible spending or having their medical contributions paid an after tax basis.

The pre-65 retiree, with at least 10 years continuous service, is eligible for the same medical plan options as the active member until age 65. Those memberswith over 15 years of continuous serviceused to pay (before January 1, 1998) their contributions based on their annual pension salary, which clearly is fair and makes perfect sense.

However, in the 1997 Contract (rejected by Local 201) a seemingly “harmless” provision was added to the benefits section. It read “If you had 15 or more years continuous service,retired on or after January 1, 1998and your normal straight time annual earnings at thetime you were retired were$60,000 or more…..then your contributions for medical coverage will be the same contribution rate applicable to an active employeein the same pay classification as you were when you retired”.

Before this provision went in, all pre-65 eligible retirees medical contributions were based on their lower pension income and NOT their higher pay from their last job. The reason this new provision was seemingly “harmless” was because in 1998 there were NO DAYWORK RATES in ourPlants (or across the country) that would provide an annual 40 hour income over $60,000. For example, an R23 in Lynn on Jan 1, 1998 had an annual 40 hour salary of $43,274 well below the $60,000 threshold set in the new provision. Thus, no one was getting hurt by the new provision.

However by 2010 with wage increases over 12 years (1998- 2010), any dayworker whose currenthourly rate was $28.85 or more(or retiring from an R19 or above job inLynn) was now negatively impacted by that 1998 provision. Of course, all pieceworkers at that time would be too (except in a very rare case).

A retiree is on a fixed income. The pre-65 retiree does not get the benefit of the active members contractual wage increases over the 4 years of a Contract but does get the “luxury” of any medical contribution increases that are agreed to. When GE hikes medical contribution rates for active members, it applies the rate increase to the pre-65 retiree.

The 1998 provision never should have found its way into the Contract and should be REMOVED in the interests of fairness,The Unions tried to address this last Contract but the Company only agreed to push the $60,000 threshold up to $70,000. So as it currentlystands,anyone retires from a job rated R21 or above in Lynnwill pay based on their higher shop rate not their lesser real pension income. If this clause is not removed or modified significantly, there soonwill be NOemployees in the country who pay the fairer and lower medical contribution rate based on their annual pension salary- which is in fact the real INCOME they have.It is time to rectify this situation in Contract 2015!!

Previous 2015 Contract Columns in Local 201 News editions:

(1)POST - 65 MEDICAL BENEFIT ATTACK NOT ACCEPTABLE– May 13, 2014

(2)2015 GE CONTRACT OVERVIEW – June 10, 2014

(3)DECENT PENSION UPDATE NEEDED– July 15, 2014

(4)IMPROVE GUARANTEED PENSION TABLES- August 12, 2014

(5)IMPROVE THE PENSION SUPPLEMENTS- September 9, 2014

Upcoming 2015 Contract Columns: (1) Younger Members Needs

(2) Post 65- Retirees Needs