The County of Los Angeles and SEIU 721 reached an agreement Friday morning on a proposal aimed at averting layoffs and demotions. The Union rejected the County’s demands for postponement of negotiated raises as premature and unnecessary at this time. In order to avert thousands of proposed layoffs and demotions, the Union agreed to a temporary suspension of the County’s matching contribution to the 457 Horizons deferred compensation plan, but with conditions to protect SEIU 721 members.
Q: Why did SEIU 721 agree to a temporary suspension of the County’s matching contribution to the 457 Horizons deferred compensation plan?
A: The County’s budget crisis is real. Due to the COVID-19 Emergency and the steep decline in sales tax revenues, the County is facing a nearly $1 billion shortfall in the 2020-21 budget. They have already drawn down reserves and “rainy day funds” to dangerously low levels. City employees and state employees are facing 10% furlough and pay cut proposals. The County has already imposed on non-represented Megaflex employees (mostly managers) a suspension of the 457 match, as well as a suspension to their 401K match.
Your elected bargaining committee members believe that – in order to avert layoffs – a temporary suspension of the 457 match, with built-in protections for SEIU 721 members, is the least impactful sacrifice that employees can make. It doesn’t affect take-home pay.
Q: What if other County union do not agree to the suspension?
A: If other County unions do not agree, then the suspension will not apply to SEIU 721 members either.
Q: Will this agreement stop the layoffs and demotions?
A: The County’s position is that the suspension of the 457 match will reduce the number of layoffs, but in order to prevent all layoffs the unions would need to agree to also postpone the October 2020 and January 2021 negotiated raises.
But SEIU 721 believes that – with the sacrifice we are making – we will be able to stop all layoffs. The layoffs would not take effect until October 1, 2020. In the meantime, we will continue to fight for financial relief from the federal government (legislation is pending in Congress). And we will fight to make sure that the County cuts all fat in the budget rather than laying off anyone. Chop from the Top!