Saint Paul Public Schools Rejects Union Proposal for Unbudgeted Health Care Contributions

  • Aug. 16, 2019

     
     
    Saint Paul Public Schools (SPPS) today rejected a proposal by members of Saint Paul Federation of Educators (SPFE) and Minnesota Teamsters 320 that would have cost the district $3.6 million in new healthcare contributions in exchange for unions suspending their push to break a health insurance contract with HealthPartners.
     
    “SPFE and the Teamsters voted to take action that would break the district’s contract with HealthPartners, which would cost SPPS a $4 million early termination fee and force a 22-percent increase in health premiums onto all other SPPS employees,” says Dr. Joe Gothard. “Though the contract with HealthPartners is maintained under the proposal, it would have reimbursed those affected employees health insurance costs, and those funds have not been budgeted.”
     
    Neither the $4 million early termination fee nor the $3.6 million in increased contributions demanded by the unions in order to avoid that fee are in the current SPPS budget. This, less than nine months after voters of Saint Paul approved a referendum adding approximately $17 million to the District’s budget.
     
    Dr. Gothard did propose, again, a solution to this situation; one that would protect students and taxpayers and enable SPFE and the Teamsters to choose whichever health insurance plan they want: Delay moving away from the current contract with HealthPartners until the contract expires in 12 months.
     
    “Unions have the right under law to choose a health insurer, and we respect and support that right,” says Dr. Gothard. “However, that right must be exercised within the process established by statute and consistent with any existing health insurance contracts. My main responsibility – and that of our school board – is to our students and our community. By confirming with the unions that the School District will facilitate a smooth and cooperative transition for their memberships into PEIP in January 2021, the School District will be able to honor all of its statutory and contractual commitments.”
     
    Under Minnesota statutes, SPFE and the Teamsters can vote to leave the district’s health plan, however, there is no language dictating when that change has to occur.
     
    SPPS is currently negotiating a new contract with SPFE, which represents approximately 4,200 of the district’s 6,000 employees. The current contract expired on June 30, 2019.
     
    “We have no intention of negotiating outside of the collective bargaining process,” says Dr. Gothard. “Our commitment is to work for the good of all of our employees, not just some of them.”
     

Saint Paul Federation of Educators (SPFE) and Minnesota Teamsters 320 Present a Costly Proposal

  • Aug. 13, 2019

     

    Union leadership from the Saint Paul Federation of Educators (SPFE) and Minnesota Teamsters 320 shared a costly proposal in exchange for delaying their move to the Public Employees Insurance Program (PEIP).

    During a meeting with Superintendent Joe Gothard and Board Chair Zuki Ellis, union leaders said they would delay a move to PEIP – which could cost the District $4 million and increase premiums by 22 percent for remaining employees – but only if SPPS paid a bigger share of SPFE and Teamsters health care costs. 

    The extra costs, estimated by the unions to approach $1.5 million, would occur in the middle of the current fiscal year (2019-20) and, if accepted, would take funds from other areas of the budget. SPPS is reviewing the proposal and will conduct its own estimates.

    In May, SPFE and Teamsters Local 320 separately voted to give notice to SPPS of their intent to participate in the state’s PEIP insurance program. SPFE previously expressed its desire that this change go into effect on January 1, 2020, with an open enrollment process this fall.

    Superintendent Gothard and Chair Ellis (letter July 19, letter Aug. 8) previously requested that both union groups delay a move to PEIP to Jan. 1, 2021. This delay would allow SPPS to fulfill its existing two-year contract with HealthPartners, avert a projected 22 percent premium increase for other employees, and avoid a $4 million early-termination fee. 

    Potential health insurance carriers must submit proposals to provide coverage to SPPS. A Labor-Management Committee, made up of human resources staff and representatives from the various bargaining units, including SPFE and Teamsters 320, reviewed the proposals. The committee voted to recommend a two-year (2019-2021) contract with HealthPartners and the Board of Education approved the recommendation on June 19, 2018.

Superintendent and Board Chair request response from SPFE and Teamsters by Aug. 14

  • Aug. 8, 2019

    Saint Paul Public Schools Superintendent Joe Gothard and Board of Education Chair Zuki Ellis sent a second letter to Saint Paul Federation of Educators (SPFE) and Teamsters Local 320, asking for a response by Aug. 14. The letter requests both union groups to delay a move to the Public Employees Insurance Program (PEIP) to Jan. 1, 2021.

Update Regarding Health Insurance for SPPS Employees

  • Aug. 5, 2019

    In May, the Saint Paul Federation of Educators (SPFE) and Teamsters Local 320 separately voted to give notice to Saint Paul Public Schools (SPPS) of their intent to participate in the state’s Public Employees Insurance Program (PEIP). SPFE has expressed its desire that this change go into effect on January 1, 2020, with an open enrollment process this fall.

    If implemented, this decision will violate our existing two-year contract with HealthPartners and will have real impacts on SPPS, its employees and its students, including, but not limited to: 

    • Increased premiums for remaining employees, including a projected 22-percent increase next year
    • An unbudgeted, $4 million fee from HealthPartners for significantly reducing the number of employees covered under  the current contract

    Under the Health Insurance Transparency Act (HITA), unions have the option to participate in PEIP if the majority of voting members approves. SPPS is simply asking SPFE and Teamsters 320 to wait until the two-year contract with HealthPartners is complete at the end of 2020 to avoid significant financial losses, to enable the District to solicit proposals for a new insurance plan and to keep District resources where they belong - in the classroom.

    The statute requires unions to provide notice of their intent to participate in PEIP at least 30 days before the end of the collective bargaining agreement. The statute does not establish the timeline for when participation in PEIP must begin.

    Superintendent Joe Gothard and Board Chair Zuki Ellis sent this letter to SPFE and Teamsters 320 union leadership on Friday, July 19, requesting a delay for one year. Nothing legally prevents the unions from doing so. SPPS has confirmed with Minnesota Management and Budget, the State agency that administers PEIP, that the unions are welcome to enter PEIP in January, 2021.

    Please view the section below for factual answers to frequently asked questions. These FAQs will be updated regularly, so check back again. Our hope is that SPFE and Teamsters 320 will think about all staff members, the financial health of SPPS and the students we all serve while considering the District’s request to begin participation in PEIP on January 1, 2021.

Frequently Asked Questions

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  • How was HealthPartners chosen?

  • Can the District simply negotiate the early termination fee with HealthPartners?

  • How will staff be affected if SPFE and Teamsters 320 move to PEIP early?

  • Does the move to PEIP have to occur now?

  • What happens now?

  • When will we know for sure what is going to happen?

  • Did the District share information about the consequences of the unions' actions before the vote?

  • How can I stay informed about this?