After much anticipation, on February 14, 2012, the Wisconsin Employment Relations Commission (WERC) submitted draft emergency rules to Governor Walker regarding how to calculate the maximum dollar amount available for bargaining over total base wage increases.  These draft emergency rules may be found at the following link:

http://werc.wi.gov/proposed_emergency_rules….pdf.

The rules provide guidance on bargaining a maximum total increase for an initial agreement entered into on or after June 29, 2011, and for successor bargaining agreements to the first collective bargaining agreement entered into on or after June 29, 2011.  The description of these rules below is for informational purposes only, as these rules are subject to change and are not final until they have been approved by the Governor.  It is not expected that the WERC will expand upon the draft emergency rules that it sent to the Governor.

Calculation of Maximum Increase in Total Base Wages for Initial Agreement

The calculation provided in this section applies to the bargaining over base wages for the first collective bargaining agreement entered into on or after June 29, 2011.  For example, this section will apply to the negotiation of 2011-2012 bargaining agreements for parties whose pre-Act 10 agreements expired on June 30, 2011.  It will also apply to the negotiation of 2012-2013 bargaining agreements for parties whose agreements were extended pre-Act 10 until June 30, 2012.  These examples are not meant to include every situation in which the rules under this section will apply.

To calculate the maximum dollar amount subject to collective bargaining over base wages under this section, the parties must first identify all of the “authorized positions” (positions in the bargaining unit) that existed 180 days prior to the expiration date of the bargaining agreement entered into before June 29, 2011.

Second, the parties must calculate the annual wages or salary received by the individuals holding the positions in the bargaining unit for the one year prior to the initial agreement entered into on or after June 29, 2011.  The annual wages or salary does not include overtime pay or pay for extra duties.

Third, the parties must add up the annual wages or salaries for all individuals holding the positions in the bargaining unit.  This amount must then be multiplied by the consumer price index change applicable to the collective bargaining agreement.  The consumer price index change is a percentage increase provided by the Wisconsin Department of Revenue to the WERC for the specific term of a contract.  This resulting dollar amount is the maximum amount subject to collective bargaining for an initial bargaining agreement entered into on or after June 29, 2011, without proceeding to referendum.

For the negotiation of bargaining agreements with terms beginning on July 1, 2011, the consumer price index change is 1.64%.  For the negotiation of bargaining agreements with terms beginning on July 1, 2012, the estimated consumer price index change is 3.16%.  For school boards who wish to exceed the consumer price index change through the referendum process, there are timelines that need to be met.  A referendum to exceed the consumer price index change must be held in April for bargaining agreements that begin in July of that year.

Calculation of Maximum Increase in Total Base Wages for Successor Agreements

The calculation in this section applies to successor bargaining agreements to the initial bargaining agreement entered into on or after June 29, 2011.  For example, for parties who did not extend their bargaining agreements prior to June 29, 2011, and, as a result, their final pre-Act 10 bargaining agreements expired on June 30, 2011, the parties would use the above section to calculate the maximum increase in total base wages for a 2011-2012 bargaining agreement, and they would use this section to calculate the maximum increase in total base wages for a 2012-2013 bargaining agreement (a successor agreement), and future successor agreements.  This example is not meant to include every situation in which the rules under this section will apply.

To calculate the maximum increase in total base wages for a successor bargaining agreement, the parties first must determine all of the positions in the bargaining unit 180 days prior to the expiration date of the most recent collective bargaining agreement.  For parties bargaining their first successor agreements, the relevant expiration date will be the expiration of the initial agreement as discussed in the above section.

Second, the parties must calculate the base wages to be received by the individuals holding the positions in the bargaining unit for the one year prior to the new collective bargaining agreement.  The base wages includes only total base wages, and excludes other forms of compensation, including, but not limited to, overtime, premium pay, merit pay, performance pay, supplemental compensation, pay schedules, and automatic pay progressions.

Third, the parties must add up the base wages received by the individuals holding the positions in the bargaining unit.  This number is then multiplied by the consumer price index change applicable to the bargaining agreement.  The consumer price index change is a percentage increase provided by the Wisconsin Department of Revenue to the WERC for the specific term of a contract.  This resulting dollar amount is the maximum amount subject to collective bargaining for successor bargaining agreements, without proceeding to referendum.

For the negotiation of bargaining agreements with terms beginning on July 1, 2012, the estimated consumer price index change is 3.16%.  For school boards who wish to exceed the consumer price index change through the referendum process, there are timelines that need to be met.  A referendum to exceed the consumer price index change must be held in April for bargaining agreements that begin in July of that year.