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Premium pay nets city workers millions in bonuses for just doing their jobs 

Wednesday, Jan 26 2011

Page 3 of 5

These are not, as you might expect, bonuses for working under hazardous conditions. The single largest category of premium pay in San Francisco is the fire department's training and education incentive, which grants an extra 6 percent of an employee's salary to anyone who has an associate's or bachelor's degree in fire-suppression science or a "related field." But you don't need to go to school to be eligible; anyone who has been with the department for at least 10 years also gets the bonus. In 2010, it accounted for $8.9 million.

Other forms of premium pay are also widely available to firefighters. Premium payments to those who worked as EMTs totaled $1.2 million last year, even though all San Francisco firefighters have been required to hold EMT certification for 20 years. Engine drivers also receive a premium, and these payments added up to $1.7 million in 2010. (Both premiums are calculated by tacking on 5 percent of a person's salary.) By contrast, what many would consider a more reasonable premium for firefighters — a bonus for those who work with hazardous materials as a regular part of their jobs — added up to a comparably small $270,000 over the same period.

Tom O'Connor, president of the city firefighters' union, defends the premiums, arguing that they are rewards for higher levels of training or more difficult and risky kinds of work. For instance, he says firefighters who work as EMTs on a given day expose themselves to greater liability if they make mistakes. Losing an EMT license because of missteps on the job would also mean suspension, since holding the license is a condition of employment. The other firefighters in a squad don't run that risk when they're not the designated EMT, he says.

O'Connor asserts that the idea of a premium for EMTs was originally introduced by the city long ago as a cost-saving mechanism. He says that by paying a premium, the fire department avoids having to establish a separate, higher-paid rank for firefighter EMTs, thus saving itself money in long-term pension and health care costs. "I understand the city is looking for every nickel and dime under the couch cushion," he says. However, "it's funny that they criticize it, because probably nine times out of ten they came up with the premium." (Despite his description of the premium's origins, O'Connor acknowledged that city negotiators now "constantly try to get rid of" the EMT payment, arguing that it is redundant with firefighter job requirements.)

Monica Fields, the fire department's deputy chief of administration, likewise defends the premium payments received by her employees. The engine-driving premium — officially called "apparatus operator assignment pay" — is recompense for a position of greater responsibility, she says, since drivers are tasked not only with steering an engine to a fire but also ensuring that the proper amount of water flows from the engine to the scene once there. "You really are the lifeblood of [an] incident," she says. "Although a good majority — actually, all firefighters — are trained to operate a fire truck, above the role of firefighter, I think it's even more important than that."

Fields believes the premiums are fair. She also remembers a time when they did not exist. When she entered the department in 1989, there was no premium for working as an EMT. Nor was there a premium for driving the fire engine, as she recalls, though she admits she wasn't paying close attention to which bonuses were on offer. "I was a junior firefighter," she says. "I was learning how to do my job. I wasn't thinking about premium pay. I was just happy to have a job."

Where did the current $70 million in premium payments come from? Jim Lazarus, who is now senior vice president at the San Francisco Chamber of Commerce, worked as a deputy city attorney and private lawyer advising the city on labor relations in the 1970s and 1980s. According to Lazarus, many premium payments emerged as a result of the idiosyncrasies in the city's old way of negotiating union contracts.

Collective bargaining — the most common form of negotiation between unions and workplace managers — did not begin in San Francisco until the early 1990s. Before that, the city used various methods of calculating government workers' wages. In the late 1970s, Lazarus says, the city used a particularly rigid formula to set its employees' salaries, based on a survey of compensation in other municipalities. In years when the formula dictated that wages remain static, bargaining focused on benefits — and bonuses.

For instance, during a wage freeze for plumbers in the 1970s, Lazarus says, the city placated its union by creating a premium payment many plumbers were likely to receive — a bonus for working around sewage. This "excrement increment," as it was known, functioned as a back-door raise.

"Now, every plumber doesn't work around raw sewage every hour, so there's some justification for it," he says. "But it was really to get around a wage freeze in the formula." Today, some unionized trade workers still receive a premium for working around sewage.

When it comes to odd categories of pay, there's no end to the quirky bonuses that can be found in the city's 32 contracts with various unions. Mechanics get a $1.20 per hour premium for repairing tires, and an extra $1.25 per hour for repairing fire-truck tires. Painters get an additional 75 cents per hour while applying epoxy, and 50 cents per hour while using sandblasting equipment.

"Some of these things are just layered from an older bargaining history, when we bargained that stuff because we had nothing else to bargain," Lazarus says. "We do all these things for cutting back overtime. That's kind of been the public focus, without looking behind all these work-condition payments ... it's just layer upon layer, and it really needs to be looked at."

The persistence of odd bonuses, in and of itself, is less of a financial drain on the city than the ways in which some of the most common forms of premium pay have grown more costly. (The Superior Court's word-processing premium accounted for only $1,856 in pay in 2010, according to court spokeswoman Ann Donlan.) Since the advent of collective bargaining, unions have succeeded in enlarging their members' returns on existing premium payments. For instance, they have negotiated to have many premiums changed from a flat dollar payment to a percentage of an employee's salary, allowing the bonuses to gradually increase as their recipients get raises.

About The Author

Peter Jamison


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