Over the objections of union leaders and a majority of City Council members, the City of Detroit is cutting the pay and toughening work rules for many of its unionized workers, Mayor Dave Bing said on Wednesday. þþþThe move, aimed at saving $102 million a year in a city so financially troubled that its leaders announced this year that it was at risk of running out of cash entirely, is perhaps the most significant result so far of Detroit’s reluctant decision to allow formal state oversight of its finances. Under a deal that the city entered into in April in order to prevent an outside, emergency manager from taking control of the city, sharp cuts in new contracts for workers were permitted, with or without union approval. þþ“This is a tough day for me, a tough day for city workers and a tough day for all of Detroit,” Mayor Bing said, announcing 10 percent wage cuts that will affect many of the city’s nearly 50 unions. Among the city’s financial problems — which include long-term debts of $12 billion — was its annually spending $150 million beyond its means, then borrowing millions more to cover the shortfall, Mr. Bing said. “Without action, the city will shut down,” he said. þþFor City Council members, the result was a sign of their newfound weakness: The Council voted 5-to-4 on Tuesday to reject the cuts to workers’ pay and benefits, but the rejection was trumped by approval from the administration and an advisory board, appointed by state and city officials as part of Michigan’s broad oversight powers. þþUnion leaders, many of whom had negotiated with Mr. Bing’s administration months ago and said they had reached tentative deals, including sacrifices from workers in pay and benefits, only to have them swept aside, were furious. þþAccording to Mr. Bing’s office, city employees face pay cuts, a shift from rules of seniority for transfers and promotions, a reduction in additional pay for afternoon and nighttime shift work, an end to supplemental unemployment benefits beyond legal requirements, and more. About 11,000 people work for the City of Detroit, a number that officials expect to cut by nearly 1,000 by the end of 2012. þ
Source: NY Times
