Malloy Orders Layoffs Today; No Deal Reached With Unions

Leo Canty, vice president of the American Federation of Teachers Connecticut, speaks at the capitol about layoffs. (PATRICK RAYCRAFT)

Despite numerous hours of talks over the past two months, Gov. Dannel P. Malloy ordered layoff notices to start going out Tuesday because no deal has been reached between his administration and the state employee unions.

Malloy had been warning workers about potential layoffs since he unveiled his budget on February 16 - although it seemed like a remote and faraway possibility at the time. He and his staff said repeatedly that he wanted to avoid layoffs -- which he said could number 4,000 or more -- as the discussions continued with the unions that represent about 45,000 state employees.

"It's disappointing that the governor has decided to go forward with issuing pink slips," said Matt O'Connor, a spokesman for the coalition of state employee unions that has been in discussions with the administration about possible concessions. Malloy had delayed the pink slips on Friday in hopes of reaching an agreement over the weekend, but no accord was reached.

O'Connor said as of Tuesday morning, more talks were scheduled later in the day between the union coatlition and the administration. O'Connor said the leaders of individual bargaining units in the coalition were being briefed Tuesday morning on the talks by coalition leaders involved, to bring everyone up to date about what has happened and what may be expected now.

Follow Live Updates On Twitter From @capitolwatch and @notesfromhel

Some of the largest layoffs would come at the state's vocational-technical high schools, where parents say that many children are receiving a solid education that suits their needs better than traditional community high schools.

Some insiders said for weeks that the two sides were never really close to a deal, while others expressed more optimism that an agreement could be struck.

It was clearly a somber day in state government, and it seemed relatively quiet in the hallways of the state Capitol.

"We held off on any layoff notifications while we tried to complete a deal over the weekend and on Monday night,'' Malloy said in a statement Tuesday morning. "Unfortunately, absent an agreement and in order to comply with contractual notice requirements and the provisions of the budget agreement signed last week, we need to begin those notifications today. Therefore, I have directed OPM to begin issuing layoff notices in an orderly fashion to the first 4,742 state employees.''

Malloy had been trying to reach $1 billion in savings and concessions per year that would have included a variety of givebacks by the workers. The issues under discussion included a two-year wage freeze, additional unpaid furlough days, pension and healthcare changes, and allowing the creation of a 401 (k) program for all new state employees who were hired after July 1. Currently, all state employees are eligible for a traditional pension plan as long as they meet the age and service requirements.

For months, Malloy had said that reaching $1 billion was achievable because the state could save $300 million through wage freezes and another $100 million by switching to a health plan similar to the one used by federal workers. The unions, however, said the proposed givebacks amounted to an average of more than $20,000 per worker. No workers, however, would have seen their salary cut by that amount.

The layoffs mark a 180-degree turnaround in Malloy's relationship with organized labor.

Only last year, the layoffs would have been unthinkable as Malloy enjoyed a very close relationship with the unions during the gubernatorial election campaign - as the unions helped provide the margin of victory in a close election with Republican Tom Foley. Malloy won by one-half of 1 percentage point, and he actually lost the race in a solid majority of the towns in Connecticut. But a large turnout in cities like Bridgeport helped push Malloy over the top and into the governor's office.

Despite the layoffs, the state employee coalition, known as SEBAC, says it will continue to meet with Malloy's chief negotiator for "at least one more day'' in an attempt to reach a last-minute deal.

"The discussions have been extraordinarily complex and demand our continued efforts to find mutual resolution,'' the unions said in a statement.

"Our discussions with the administration cannot be separated from the broader struggle for a fair economy based on shared sacrifice. Middle-class workers, whether public or private, did not cause Connecticut's economic problems and should not be asked to bear an unfair burden in their resolution,'' the unions said as the layoff notices were going out. "This is especially true when Wall Street and the super-rich who have profited at our expense during the economic downturn have been asked to sacrifice so little.''

Sticking to a confidentiality agreement that they had made at the start of the talks, the negotiators were largely successful in refusing to discuss the substance of the talks. Even two of the legislature's biggest supporters of unions - House Speaker Chris Donovan of Meriden and state Sen. Edith Prague of Columbia - both say they have had no details on the talks.

"The Governor's Plan B proposal paints a bleak picture for Connecticut,'' Donovan said Tuesday in a very brief statement. "I ask Governor Malloy and the leadership of the state employee unions to stay at the negotiating table and get the job done."

Under the law passed as part of the two-year, $40.2 billion budget, the cuts that will be necessary in addition to the layoffs would require approval by the Democratic-controlled legislature before the end of the legislative session on June 8.