Fewer hours means big savings: plan would save city $110M

The City will save $110 million during the next 14 months if it implements Mayor Gavin Newsom’s reduced workweek proposal that affects 17,400 filled and unfilled positions, according to an analysis from the City Controller’s Office released Tuesday.

Faced with the task of closing a $522 million deficit for next fiscal year, which begins July 1, on the heels of closing a $40 million midyear budget shortfall, the mayor last week mailed out thousands of pink slips to city employees with the intent of rehiring thousands at a shortened workweek of 37½ hours, down from 40 hours. The rehiring of the “overwhelming majority” will conclude within two weeks, according to the Mayor’s Office.

The proposal generates $110 million in savings from May of this year to June 2011 and affects both general-funded departments and those enterprise departments that are self-sufficient, as they generate their own revenue. The reduced workweek represents a 6.25 percent reduction in wages.

Newsom has said laying off the workers and rehiring an “overwhelming majority” of them on a 37½-hour workweek is the best solution he has heard to help close the budget gap. It would prevent terminating thousands of workers’ jobs.

“The 37½-hour idea was a way of equalizing,” Newsom said in an interview Tuesday. “I would have to go to every single labor union, open contracts that are closed and engage with those open contracts in collective bargaining for each and every local.
“Every labor union is in this together. We aren’t going to pick and choose. That being said, they are coming back Thursday with a set of alternatives, and I will keep an open mind.”

The Department of Public Health has 4,712 positions affected for a savings of $35.5 million, according to the analysis, while the Recreation and Park Department has 931 affected positions for a savings of $4.4 million. Among other affected departments: Public Works, 1,114 positions for a savings of $4.9 million; Police, 435 positions for a savings of $2.2 million; and Fire, 53 positions for a savings of $408,497.

Among those not impacted are police officers and firefighters. Newsom has said he is in talks with those labor groups about giving up pay raises, equal to about 6 percent, next fiscal year.

The City’s largest labor union, Service Employees International Union Local 1021, has sent out a “fight back” call to attend the Board of Supervisors Budget and Finance Committee meeting today and called the 37½-hour workweek an “absurd proposal.”

“We are not going to roll over on the 37½ workweek,” said Bob Muscat, head of Professional and Technical Engineers Local 21.

According to union representatives, among the plan’s faults is the uncertainty families go through between receiving the layoff and discovering whether they are going to be rehired.

It’s designed to “side-step” labor contracts and it includes no discussion on how the remainder of the deficit will be closed, Muscat said. He said The City needs to examine other ways to achieve savings. 



Less time on the clock

Major departments and total dollars saved by cutting workweek from 40 hours to 37½ hours:


Department  Savings
Administrative services  $3,582,453
Airport commission  $6,926,287  
Department of Public Health  $35,575,557
Department of Public Works  $4,948,345 
Human Services Agency  $10,306,146 
Police  $2,232,018
Public Library $3,498,537
MTA  $7,975,149 
Public Utilities Commission  $14,359,348
Recreation and Park Commission  $4,418,177
Total  $110,727,015

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