Compensating state workers a balancing act

Matt Bittle
Posted 7/11/15

  DOVER — Gloria Coverdale has held a state job for 15 years. She is a lab tech in Delaware Health and Social Services, working at the James W. Williams State Service Center in Dover. Ms. …

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Compensating state workers a balancing act

  DOVER — Gloria Coverdale has held a state job for 15 years. She is a lab tech in Delaware Health and Social Services, working at the James W. Williams State Service Center in Dover. Ms. Coverdale, who, like most government employees, works 37.5 hours per week, is on the lower end of the state’s pay scale. She is paid $32,000 a year and isn’t happy about it. Salaries have not kept up with the cost of living, she complains. She’s one of approximately 36,000 people employed by Delaware, ranging from nurses to prison guards to teachers. Delaware government is by far the largest single employer in the First State. Those tens of thousands of employees have seen their pay both increase and decrease under Gov. Jack Markell. When he took office in 2009 the state was facing an $850 million shortfall. To help close the gap, the governor proposed an 8 percent decrease to all state employees’ salaries, which ultimately was negotiated down to 2.5 percent. That cut was restored the following fiscal year, 2011.
Office of Management and Budget Director Ann Visalli said if one looks at not just at pay but also at benefits and level of employment, Delaware compares favorably to nearby states. (Delaware State News file/Dave Chambers) Office of Management and Budget Director Ann Visalli said if one looks at not just at pay but also at benefits and level of employment, Delaware compares favorably to nearby states. (Delaware State News file/Dave Chambers)
Employees saw a 2 percent increase in fiscal year 2012, as well as a 1 percent raise the next year. The base pay grades, of which there are 26, have remained static the past three years, but state employees did get an additional raise. Employees received a $500 increase starting in January. A 1 percent raise was proposed, but the General Assembly’s Joint Finance Committee opted instead to fund a flat raise to benefit low-wage workers. For those paid less than $50,000, $500 is more than 1 percent. “By not moving the pay table, it gives us a way to pay current employees a little more but not necessarily advance all the starting salaries,” said Ann Vasalli, director of the Office of Management and Budget. She said the flat raise essentially cost the state the same as the proposed rate. Had the base levels increased by $500, some longtime employees might have been bothered if new employees starting later received the same pay as they did, she said. The annual salary for employees on the regular state pay grade system varies from $18,049 to $139,223. Salaries for some, such as judges and cabinet secretaries, are determined differently. Legislators are paid $44,451, while many judges and cabinet-level directors get more than $100,000. The governor is paid $171,000 per year. An employee’s pay depends on his or her position, of course. Each job is assigned a pay grade, based on the responsibilities and requirements. Once an employee is hired at a particular pay level, he or she is generally locked in there. Most positions, with the exception of accountants, human resource specialists and a few others, do not allow employees to move up in pay grade short of moving to a new, higher-ranking job. According to the U.S. Bureau of Labor Statistics, the average state employee — of which there were about 4.48 million — made $55,520 as of May 2014. Reports on how Delaware public employees’ salaries, and how they compare with private sector employees, are hard to come by. With 36,000 employees in so many agencies it is difficult to draw sweeping conclusions. But that hasn’t stopped many people from developing strongly held opinions. Criticisms and explanations Ms. Coverdale thinks the state hasn’t done a good job of taking care of its employees. She’s a pay grade 9 employee. The governor is “all about helping other people, but us, his employees, he don’t really care about us, I just think,” she said. Many employees have to take a second job or receive state assistance to get by, she said. According to DHSS, at least 1,521 state employees received benefits as of December. Ms. Coverdale is confident she could make more money at a private hospital, but she is reluctant to leave the place where she’s worked for 15 years, since she’s been planning for retirement. She said she was unaware of the pay increases employees have received during the Markell administration. When informed of the $500 raise state employees were given in January, Ms. Coverdale dismissed it as too low, noting it amounted to less than $20 more per paycheck. For lower-income employees such as her, that $500 is more than the 1 percent raise would have been. Others were critical, as well. Geoff Klopp, a correctional worker and the president of the Correctional Officers Association of Delaware, has been an employee of the Department of Correction for 27 years. He was paid $44,000 last year, a sum he called “embarrassing.” He said the “last eight years has been most difficult time for pay raises that I’ve seen in my career.” That timespan, of course, coincides closely with the recession, which the National Bureau of Economic Research says lasted from December 2007 to June 2009. The recession resulted in a major budget crunch for Delaware, and like the nation as a whole, the state is still absorbing the effects of the economic decline. As other states and the private sector have seen layoffs, stagnant salaries and health-care increases, Delaware government has become a more attractive employer, Ms. Visalli said. By looking not just at pay but at benefits and level of employment, Delaware compares favorably to nearby states, she said. State employees can receive health care that is better than many private-sector plans, as the state government covers around 90 percent of the costs. A proposal to increase deductibles this spring was shot down, thanks to public and legislative outcry. Instead, in what was seen as a victory for public employees, workers will have mostly minor co-pay cost increases. Mr. Klopp, the lone public employee representative on the State Employee Benefits Committee, fought against the changes. While he was happy to see the deductible plan defeated, he fears more changes are coming, to the detriment of employees. “When pay doesn’t go up and medical continues to go up, we’re doing nothing but going backward,” he said. He’s not the only union representative wary of possible future increases. Delaware has always ranked below neighboring states in employee pay but good benefits helped counterbalance that, Michael Begatto said. He’s the executive director of Delaware Public Employees Council 81, which represents about 3,500 state workers.
Michael Begatto Michael
He believes the benefits now are looking less attractive. He criticized the government for the spring proposal, which he saw as an unwelcome surprise. Mr. Begatto also questioned why the state has not filled a number of vacant positions. That was done to help keep costs down, Ms. Visalli said. Since the start of the Markell administration, the state has reduced 635 cabinet-level positions through attrition, by not hiring employees to fill certain spots when someone leaves. As a result, Delaware has been able to avoid making layoffs, of which top state officials are proud. Teachers The government also has been able to fully fund teacher step increases, despite some serious uncertainty for this fiscal year. Step increases are an annual pay raise for teachers, maxing out after 16 years. After much trepidation — and some protests from the teachers’ union — the Joint Finance Committee last month funded teacher steps for fiscal year 2016, which began July 1. Funding teacher steps for a year costs about $10 million, Ms. Visalli said. Some other employees, such as nurses and Capitol police, also get step increases. By comparison, Maryland suspended all steps for state workers for the current fiscal year, something Ms. Visalli noted as she detailed Delaware workers’ compensation. Step increases go into effect automatically after every year for teachers, assuming money is available. As far as Delaware State Education Association officials can recall, step increases always have been funded, said Frederika Jenner, DSEA president.
Frederika Jenner Frederika
Exact teacher salaries vary from district to district. A new teacher with a bachelor’s degree could be paid $38,621 to $45,672. The difference comes from the method used to pay teachers, with both the state and district providing some funding. A new teacher will make close to $28,000 from the state and between about $10,000 (Colonial) and $17,000 (Sussex Tech), depending on the district. Ms. Jenner said she believes teachers are paid fairly, although she noted they typically have been paid lower-end salaries than many other professions. She has no specific qualms with the Markell administration, and while some of the nearly 13,000 members of the DSEA remain unhappy over the pay cut they took several years ago, she believes most governors would have acted the same way. Looking back and ahead One state agency has had difficulty attracting new people because of the salaries. The Auditor’s Office had trouble for years because the starting salaries for entry-level positions were too low, Auditor Tom Wagner said. He received authority in the past year to move beginning employees up a pay grade, meaning they’ll be paid more. “The little difference helped,” he said. While some believe Delaware is behind the curve in caring for its government employees, Ms. Visalli believes the state continues to become a more attractive employer. Unlike most companies and a growing number of states, Delaware’s pension plan has not seen many changes in recent years, she said. “Essentially, full retirement is after 30 years of service,” she said. She noted it’s 25 years for correctional employees and 20 for police. A spokeswoman for Gov. Markell said the governor “will continue to look for opportunities to increase compensation when it can be done in a fiscally responsible way.” At a JFC meeting last month, Sen. Harris McDowell, D-Wilmington, said he fought against the health-care cost increases and did not plan to push for employee raises due to the tight budget situation. With state budget officials anticipating a deficit that is already around $150 million for the next fiscal year, a pay raise appears unlikely at this point. Despite bold statements from both sides, the situation is not black and white. “Certainly any employee of any operation would be happy to have additional compensation,” Ms. Jenner said with a laugh. Perhaps that’s the crux of the matter.
featured, economy, budget
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