With a 11-0 vote, the Los Angeles City Council approved a new contract between the Department of Water and Power and its union Tuesday.
The contract delays pay raises for current employees for three years. The contract will also modify retirement benefits for future workers by increasing the retirement age to 63, capping pension payments at 80 percent of an employee's salary, and denying retirement health benefits to spouses. Employees will also increase their contribution toward retirement from 6 percent to 10 percent.
The contract will also settle a lawsuit brought by the International Brotherhood of Electrical Workers, Local 18. Historically, when city employees transferred to the DWP, the utility picked up the pension costs for that worker. That didn't sit well with the union, which sued the city over the issue. Approving this contract will end that reciprocity agreement. Employees who transfer between the city and utility will now be responsible for making up the difference between the plans.
The Coalition of L.A. City Unions represents most municipal employees. It didn't like the change to the pension plan, saying it would make the move from the city to DWP "effectively impossible." In recent years, as city departments lost positions to budget cuts, many employees sought transfers to the utility.
“We’re disappointed in the council action," said the coalition's Cheryl Parisi. "We believe the changes in the pension ordinance basically diminishes the value of pensions for workers in who might transfer or promote to the DWP.”
Parisi said all necessary remedies will be pursued. The coalition has filed a complaint on the matter with the city's Employee Relations Board.
The city council approved the DWP contract without discussion.