A long-standing dispute between the Governor’s Office and state employee unions over back pay and raises – which Gov. Susana Martinez says has a price tag of $23 million – was aired Wednesday in the state Supreme Court.
State workers jammed the courtroom as justices heard the state’s plea to overturn last year’s Court of Appeals ruling that about 10,000 employees are owed pay raises retroactively to July 2008.
The high court made no immediate decision in the case, which is rooted in the administration of Democratic former Gov. Bill Richardson.
The affected employees – roughly half the state’s workforce – are union members and nonmembers who are in bargaining units represented by the American Federation of State, County and Municipal Employees or the Communications Workers of America.
Arbitrators, a district judge and the Court of Appeals have agreed that those workers got smaller raises than they had negotiated in collective bargaining agreements for the 2009 fiscal year, which began on July 1, 2008. The negotiated raises ranged from 3 percent to 5.5 percent; workers instead got 2.9 percent.
That’s because the Richardson administration took the nearly $13 million appropriated by the Legislature for pay raises and used it to give all classified employees – whether or not they were covered by union contracts – 2.9 percent raises.
The Court of Appeals ruled in August that the state should have provided the bargained-for increases to union-covered workers first – at a cost of about $8 million – then used the remaining $5 million for salary increases for other workers.
AFSCME lawyer Shane Youtz said the state should be ordered to pay up. The Legislature appropriated enough money for the bargained-for raises, but the state used it for a different purpose, he contended.
“This requires enforcement of an agreement … a contract that the state of New Mexico breached,” Youtz told the justices.
Lawyer Thomas Stahl, representing the state, argued that under the collective bargaining law, the Legislature had to specifically authorize pay increases that disproportionately favored union-represented workers over nonrepresented workers. It didn’t do that, so the pay agreements weren’t binding, he said.
“The arbitrators acted outside their authority,” he told the court.
He said that requiring back pay could mean layoffs or cuts in programs, although he wasn’t more specific.
A spokesman for the Governor’s Office, which had estimated a $20 million price tag last year, said the current projected cost of retroactive pay is $23 million.
That would somehow have to be absorbed by state government, “and that could mean reduced reserves or a strain on services as agencies seek to find the additional dollars within their existing budgets,” said the spokesman, Enrique Knell.