PROVIDENCE – The bitter contract dispute between the Carcieri administration and the state’s largest public employees union appears to be over: Union officials this afternoon confirmed that rank-and-file members of Rhode Island Council 94 of the American Federation of State, County & Municipal Employees (AFSCME), ALF-CIO, have ratified a four-year contract that raises wages 8.5 percent over its final three years but increases employees’ health care costs.

The vote was 1,569 to 1,075.

“During these tough economic times we were able to work out a new contract that is fair for our members and the citizens we provide services to on a daily basis,” said Dennis R. Grilli, executive director of Council 94, which represents about 4,100 state employees.

“With the concessions achieved in the new labor agreements, coupled with the changes in retiree health benefits and subsequent retirements, we have achieved our goal of $90 million in personnel savings,” Gov. Donald L. Carcieri said in a statement this afternoon, after emerging from closed-door talks this morning with the small business community. (READ MORE)

The agreement will change both the way and amount in which unionized state workers are assessed for health benefits.

Currently, workers pay 2.5 percent of their salaries to participate in a health plan. Under approved contract, that assessment will change to 12 to 25 percent – depending on their salary bracket — of the total cost of each worker’s health insurance premium.

That provision is very similar to the one contained in the contract proposal that was overwhelmingly rejected by the union in July. (READ MORE) And it includes a clause that will make the change in coshares retroactive to Aug. 8.

This time around, however, Carcieri also agreed to rescind the “List B” letters issued in the past fiscal year notifying some workers that their jobs were in jeopardy.

For its part, Council 94 agreed to withdraw the unfair labor-practice charges it filed against Carcieri in July, when he attempted to unilaterally change workers’ health care benefits. (READ MORE) But the new agreement does not prohibit the union from continuing its lawsuit against the governor and the state over changes to the retiree health-care benefits.

Council 94 President J. Michael Downey noted the creation of a Wellness Incentive Program that will reduce co-share payments by as much as $500 per year for people who quit smoking and agree to be examined by a primary-care doctor. The governor also mentioned that provision: “A wellness program will help to control year-over-year health care cost increases and create a healthier, more productive work force,” he said.

“While the road to a new contract was a bit bumpy, I firmly believe that this contract is fairer to some of the lowest-paid state employees,” Downey said in a statement today. “I am proud that our membership has stepped forward during these times of economic crisis to help the State of Rhode Island. Council 94 hopes that the administration and General Assembly will recognize our contribution and refrain from further unilateral actions, such as layoffs and benefit reductions, in the future.”

“I am pleased to finally put this issue behind us,” Carcieri said. “The state’s economic picture is getting worse, and it is critically important that we start to implement the cost saving changes achieved from the new contract. I commend the union membership for recognizing these tough times and voting for the agreement.”

The vote seemingly puts an end to labor dispute that has lasted months.

In July, a proposed four-year agreement with the State of Rhode Island – intended to ease the state’s budget woes – was overwhelmingly rejected by union workers. Council 94 members voted 2,870 to 196 against the proposal, which among other effects would have increased the amount employees must pay toward their health insurance premiums and would have saved the state millions of dollars. (READ MORE)

When Carcieri responded by issuing an executive order that would have unilaterally instituted the proposed changes to the workers’ health-benefit coshares, the union took him to court. In August, the legal battle arrived at the R.I. Supreme Court, where Chief Justice Frank J. Williams ordered both sides into mediation – and then, after talks broke down last month, into arbitration.

Until the tentative agreement, announced on Oct. 16, the two sides had been due to start arbitration last week. (READ MORE)

Rhode Island Council 94 of the American Federation of State, County & Municipal Employees (AFSCME), AFL-CIO, is the state’s largest public-employee union, with about 4,100 members or a third of active state employees. Additional information is available at www.RICouncil94.org. News and information from the R.I. Governor’s Office are available at www.governor.ri.gov.