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Comptroller's Office Clashes with Mayor in Prevailing Wage Policy Shift

A move by Mike Bloomberg to give the mayor regulatory control of nearly 10,000 unionized trade workers would take power away from the comptroller, who is, unsurprisingly, not happy about this policy shift.

The mayor said this morning that it's common sense to eliminate a dated and unfair policy that favors a small group of workers, but representatives from Comptroller John Liu's office, in statements sent to the Voice yesterday afternoon, are firing back that it's a fiscally irresponsible idea. The policy as is, with the comptroller setting trade workers' wages, works well, Liu's office said.

The mayor's order, first reported on yesterday, would eliminate a century-old rule that gives the comptroller the power to set "prevailing wages" for carpenters, plumbers, and other trade workers. Unions representing these city workers were contacted earlier this week and told that the city is making this shift, which essentially means that they will be subject to collective bargaining with city negotiators in the future -- the way most unions operate.

This morning on his weekly radio show, Bloomberg explained the order to host John Gambling, calling the current policy antiquated.

"For reasons long lost in history, back in the 19th century...only three percent of the city's workforce had their wages set by the city comptroller. Why it was done -- it was probably some back door political thing, done in the dead of night. Ninety-seven percent of the city workers bargained collectively with the city. Three percent for no logical reason whatsoever, the comptroller set these wages. Now, most people negotiate wages with their employers in the public and private sector. This order closes that loophole," he said.

Bloomberg said that the last handful of comptrollers have set the wages 50-percent or 100-percent higher than the private sector. The process to change this, he added, is just an order from the mayor's office.

"Why it was never done before? I don't know," the mayor said. "Part of the reason is, look, you have to have the comptroller sign off on a lot of things, so administrations are reticent to annoy the comptroller. You want to get along...there's courtesy things you do all the time. People want recognition and respect...Maybe nobody was willing to do that."

(Of course Bloomberg would never want to annoy John Liu!)

He added, "Why should those three-percent have a better deal than the 97-percent?" he added.

Reps for Comptroller John Liu -- who has been fairly ambiguous about his mayoral ambitions in light of his ongoing fundraising scandal -- sent us statements of discontent yesterday afternoon, saying that the move was illogical and that the mayor's office was distorting facts in its justification of the order.

Deputy Comptroller for Legal Affairs Valerie Budzik said that it is important to have this prescribed mechanism for resolving disputes and also argued that it is incorrect to suggest that the comptroller's process inflates wages -- saying that the mayor has chosen in one case to settle at a rate higher than the comptroller's recommendation.

Communications Director Peter Thorne, the new guy in Liu's office, in a separate statement took a stab at the city for problems in its own negotiation processes with the 97-percent of workers not covered by the comptroller's wages. He said: "The current process has been in place for quite some time and actually works, so any move to unilaterally circumvent it will be sure to engender opposition."

No surprise at all, the union is also not happy with this order.

Full statements from Liu's office:

Deputy Comptroller for Legal Affairs / General Counsel Valerie Budzik:  

"State Labor Law provisions authorizing the Comptroller to determine wage rates for City prevailing wage titles have been on the books for over 100 years.  Where the parties are unable to reach agreement, it is important to have a carefully prescribed mechanism to resolve the dispute.   It is wrong to suggest that this process inflates wages.  In fact, in one recent case involving electrical workers in sewage plants, the Mayor chose to settle  at a rate higher than the Comptroller's recommendation.  City Hall cites a figure of over $600 million in back wages, but that figure is high only because the Comptroller is called upon to resolve wage disputes that have dragged on for years, with back wages piling up.  The Comptroller's determinations have been upheld by the appellate courts multiple times."  

Communications Director Peter Thorne:  

"It seems strange that City Hall would sign an Executive Order to oversee collective bargaining with three percent of the workforce, when they have an established track record of failure with the existing ninety-seven percent of city workers with whom they pledged to negotiate in good faith only to allow their contracts to expire. In fact, right now there are more than two hundred thousand City employees - from firefighters to teachers to police officers - working without a contract. This situation is not good for workers or taxpayers. It is fiscally irresponsible because City Hall's failed efforts threaten to defer billions of dollars of current costs to future City budgets. The current process has been in place for quite some time and actually works, so any move to unilaterally circumvent it will be sure to engender opposition."

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