Raises should be based on merit, not 'steps'

By Dan McCaleb, Illinois News Network | Jun 18, 2018

It's been two weeks since Illinois lawmakers and Gov. Bruce Rauner began congratulating themselves for passing what they claimed was a balanced budget that spends every bit of last summer's $5 billion tax increase.

Don't kid yourself, though. The $38.5 billion budget – the highest ever approved in the state – never was balanced. It relies on accounting gimmicks and speculative savings and revenue projections – including, for the third year in a row, the sale of the Thompson Center in Chicago.

It also failed to include more than $400 million in court-mandated raises for 14,000 members of the American Federation of State, County and Municipal Employees Council 31 union that Rauner has continued to fight. But that fight is closer to coming to an end after a Tuesday ruling by the Illinois Labor Relations Board.

Rauner, and taxpayers, stand to lose big.

Shortly after taking office in 2015, Rauner froze automatic pay hikes known as "step increases," saying lawmakers never appropriated the money. AFSCME challenged Rauner's decision in court, and the courts have sided with AFSCME ever since.

Rauner tried one last appeal with the ILRB seeking a new hearing with an administrative law judge, but the board denied him this week.

Smelling blood, AFSCME issued a statement Tuesday evening saying it wants its members' money – all three-plus years of it, and now.

"AFSCME has made clear that the remedy should include putting all employees on the appropriate step at once, and making whole all employees for step increases they have been wrongly denied from July 2015 to the present," the union said in a statement issued Tuesday evening.

If AFSCME gets its way, taxpayers will be on the hook for an unbudgeted $412 million in back step increases that will compound annually as additional step increases continue to mount on top of each other.

What exactly is a step increase? First, I'll tell you what it is not.

It's not a merit-based raise given to state employees for their hard, efficient and quality work.

Essentially, it's a guaranteed raise for employees who are at least just competent enough not to get fired. Show up for work most days you're supposed to, you get a step increase annually regardless how good your work actually is.

It's an anachronistic system that exists almost exclusively in the public sector.

And it's one of the many reasons why the state of Illinois is in such poor fiscal shape.

The cost of the raises alone for AFSCME members for fiscal 2015 is $38.7 million, according to the Rauner administration. That spikes to more than $170 million by fiscal 2019 because they are compounded – meaning the raises are added on top of the ever-increasing salaries, not the starting salaries.

The average salary of an Illinois state worker is $63,000. That's not counting the overly generous health care and pension benefits they receive. Their salaries and benefits combined are among the highest in the nation.

Everyone who works hard deserves to be paid a decent wage. But that wage should be determined by the marketplace and each individual's performance. And it should not be overly burdensome on the taxpayers who pay the salaries.

Lest we forget, Illinoisans already pay the highest combined local and state taxes in the country.

Illinois' budget will never be truly balanced until these cost drivers like step increases are reined in.

Dan McCaleb is news director of Illinois News Network and the digital hub ILNews.org. He welcomes your comments. Contact Dan at dmccaleb@ilnews.org.

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