There would be no cost of living adjustments to state employee salaries for the next two years, under a plan Governor Walker’s administration has submitted to a legislative committee.
A letter outlining the pay plan, sent from the Director of Office of State Employment Relations (OSER) to the Joint Committee on Employment Relations, can be read here. The actual compensation plan is also posted on the Office of State Employment Relations website, but be warned the file is enormous and takes a long time to load.
According to OSER’s letter, the compensation plan retains progression adjustments, some reimbursements, and some of the various types of supplemental pay that appeared in collective bargaining agreements. Some types of supplemental pay were eliminated, and calculations for determining overtime pay were changed. Senator Jeff Fitzgerald said that the changes would reduce overtime payments at the Department of Corrections by $5 million per year.
This pay freeze comes in the wake of significant compensation cuts for public employees, in the form of increased contributions to fringe benefit costs. A Wisconsin Budget Project analysis found that the changes to fringe benefit costs are regressive, hitting lowest-paid workers the hardest. Changes to public employee compensation and other changes in the state budget mean that low-income public sector workers may take a hit to their family budget of as much as 15 percent.
Even before these changes, Wisconsin public employees earned less than their counterparts in the private sector. A recent research study by the Economic Policy Institute found that full-time state and local government employees in Wisconsin earn 4.2 percent less than they would if they worked in the private sector, benefits included. This study controlled for education, experience, organizational size, gender, race, ethnicity, citizenship, disability and hours worked, and was therefore able to establish a better “apples to apples” comparison than other studies that simply compared the pay levels in the public and private sectors.
State policymakers making cuts to state government should keep in mind that Wisconsin already has one of the leanest public sectors in the country. In 2010, Wisconsin ranked 42nd among the states for the number of state government employees per capita, or 10% below the national average.