In Illinois, we have gotten used to being kept in the dark about collective bargaining with government worker unions. Recently, a bill to open up the process and require that tentative agreements be made open to the public before they are signed failed in committee.

One of the challenges facing New York City is that all of its labor contracts with unions representing city workers have expired.  If Mayor Bloomberg is unable to negotiate any deals with the city's workers, he will leave his successor a possibly $8 billion problem  in the form of retroactive pay increases (the equivalent of the budgets of fire, corrections, and sanitation departments combined). The mayor's office has said that it will only sign contracts where the unions forego retroactive raises, increase employee contributions to healthcare premiums, and provide incentives for workers to live healthier lifestyles. The Mayor needs to reduce healthcare costs, which are rising rapidly and threaten to crowd out spending on other priorities. Right now 95% of city workers pay nothing toward their health premiums. 

A mental health agency in Kentucky that participates in the state's public employee pension plan is filing for bankruptcy after the state legislature passed pension reforms that would dramatically increase contributions into Kentucky's severely underfunded pension system. Seven Counties Services, a nonprofit, is shutting down its state pension system for all employees and moving them into a defined-contribution 403(b) plan after Kentucky passed legislation that would have forced the nonprofit to spend 20 percent of its annual budget on pension costs. Although the situation is unusual because few non-government employers participate in public worker pension funds, Seven Counties predicament illustrates what happens when sharp increases in contribution levels to fix struggling pension systems hit an employer that simply can't turn to taxpayers to meet its increased costs.

I hate to say "I told you so," but after the Chicago Teachers Union strike against Chicago Public Schools last fall I wrote: 

A district that expects to drain its reserve funds and is looking at a billion-dollar budget hole the year after this cannot afford across-the-board pay raises. ... Either CPS will need a bailout, or we can look forward to schools being closed and teachers laid off.

And now the Chicago Sun-Times is reporting: 

Chicago Public Schools on Thursday announced the largest school shakeup in the nation: closing 54 schools and 61 buildings, jostling 30,000 kids and leaving the future of more than 1,000 teachers unclear.

I'm no psychic - this outcome was pretty obvious to anyone who understands how budgets work. CTU won pay raises totaling 17.6 percent (when annual steps are included), but those raises will come from a district that was staring at a $1 billion budget deficit. A school district with no money to spare and more expensive teachers really has only one option: contraction.

Michigan's newly minted right-to-work law is set to go into effect next week (March 28). Under the law workers can no longer be required to pay agency or fair share fees to unions if they do not wish to become union members. Clearly, not being able to force workers to pay into union coffers threatens unions' finances. Therefore, the unions are racing to place "union security provisions" (read: agency fees) in current contracts, some of which would be good for up to 10 years, such that employers in the state, both public and private, would still have collect monies from union members and non-members alike. State lawmakers are threatening cuts if the contracts go through and the lawsuits have started. It may turn out that actual right-to-work status in Michigan will take longer to materialize.