Collective Bargaining and Contract Administration Are Expensive

Every school district pays a high price for collective bargaining.

Financially, the highest cost associated with collective bargaining is in employee compensation packages. In 1997, the Michigan Association of School Boards reported that statewide salary increases for education employees equaled 2.6 percent. However, this figure does not take into account the total compensation figure, which should include items such as fringe benefits, paid leave, additional duty pay, step increases, and "longevity" (see Section 1 of Part II for a discussion of the structure of teacher salaries). With these factors included, the actual average increase in teacher salaries and benefits exceeded 8.5 percent.

Every school district pays a high price for collective bargaining. Another cost of collective bargaining comes from the time spent negotiating. For districts where the superintendent is expected to be part of the negotiating team, the time spent in preparation and bargaining adds as much as 80 to 100 additional hours to his workload every contract period, not counting the additional overtime for any secretarial, support, and administrative personnel. Districts that hire professional negotiators on either an hourly or per session fee basis pay between $5,000 and $15,000 for each contract period.

Even the physical contract document imposes small but significant costs on schools, unions, or both. The cost to prepare, print, and distribute negotiated collective bargaining agreements to school officials and employees averages about $600 per contract period, and some districts with fewer than 200 teachers have reported costs in excess of $2,000. Some districts also have additional expenses associated with keeping the community at large informed about the negotiations and their outcome.

Still other districts have incurred expenses arising from efforts to make the process less emotionally draining and adversarial. The Saginaw school district and its teacher union report that they pay $2,000 per day plus expenses for a labor relations attorney to guide them through a "collaborative bargaining" approach to their 1998 labor negotiations.69

There are certain unavoidable costs to administering contracts when numerous parties are involved; however, taxpayer funds allocated for educational goals have too often been diverted to pay for negotiations, general contract administration, and the consequences of poorly bargained language. School officials who carefully prepare for collective bargaining and negotiate wisely can not only reserve these resources for their intended purposes, but also maintain the trust of the parents, taxpayers, and students in their community.