As recession fades, pay increases materialize for government employees

By Conor Shine

Thursday, Jan. 15, 2015 | 2 a.m.

In the depths of the recession, local governments around the Las Vegas Valley turned to personnel cuts to stay afloat.

Vacant positions were eliminated and employees were laid off. Those who remained endured wage freezes, cuts to their benefits and other measures that, for many, kept their take-home pay flat for years.

Those days seem to be over as the economy recovers and salaries for public employees in unions and in management begin to thaw.

The most recent evidence came last week when the Clark County Commission approved a $50,000 raise for county manager Don Burnette, his first major raise since being appointed to the position in 2011. The increase boosted his salary to $262,597. Las Vegas City Manager Betsy Fretwell received a $19,000 raise in July that brought her salary to $220,000.

Burnette's raise caught the eye of the local Service Employees International Union, which represents about 5,000 county employees and has been stuck in a protracted negotiation with the county over matters that include compensation increases for its members. SEIU President Martin Bassick called Burnette's raise "hypocritical" at a time when rank-and-file employees aren't seeing wage increases of their own.

But for most bargaining groups across the valley, wages have been on the rise over the last year as new deals have been struck outside the constraints of the recession.

In December, the city of Las Vegas approved a new contract with the Las Vegas City Employees' Association that brought employees back up to a 40-hour work week after their hours were cut back to 38 per week during the recession. The deal also included a 1.5 percent wage increase and other incentives that will cost the city $13 million over the next two years.

In Henderson, the city council approved deals last year with its Teamsters Union that includes a 1 percent wage increase and a one-time 2 percent of wages bonus. The firefighters union also agreed to a new deal last year in which fire captains received a 3 percent wage increase and all employees got a one-time bonus of 2 percent of their wages.

One key element in many new collective bargaining agreements has been the elimination of longevity pay for employees, which paid out an annual bonus that grew the longer an employee stayed with an organization. Longevity pay was designed to attract and recruit employees to work in the public sector, but Burnette called it an "antiquated" payment that added up to big long-term costs for local governments.

Burnette also noted that increases for employees were coming in much smaller increments — generally 1 to 2 percent — compared with the 3 and 4 percent annual raises that were given out before the recession.

Looking forward, several unions are still working out new contracts with their various employers. In North Las Vegas, firefighters and police supervisors are at the bargaining table, just a year after the city struck a deal with its unions that included major concessions to avert a financial crisis. In Henderson, police officers and police supervisors are expected to begin negotiating new contracts soon, while in Las Vegas deals for court marshals and corrections officers are up for renegotiation. In addition to the SEIU, Clark County is currently bargaining with a small group of employees in its elevator operators union and will start negotiations with its firefighters, district attorneys and public defenders unions later this year.

With wages on the rise for employees in other unions, local governments will be hard pressed to deny raises to unions currently in negotiations. This creates a challenging situation because despite the broader economic recovery, local government revenues have returned at a slower rate due partly to property tax caps.

That could change in the coming months, as legislators are expected to consider changes to the caps. Reforms to those measures — which prevent a person's or a business' property tax bill from increasing more than 3 or 8 percent in a given year, respectively — would put more money in government coffers, but there are plenty of needs beyond employee salaries, like repairing infrastructure or restoring services cut during the recession.

Collective bargaining laws are also expected to be under close scrutiny during the upcoming session of the Legislature, which could further change the calculus of union negotiations if proposed reforms — like ending binding arbitration — are passed.