Work stoppage continues at $470 million Philadelphia FCU over healthcare changes, `unfair' labor practices

<p>PHILADELPHIA – After negotiations stalled on who should bear the expense of new-health care costs at Philadelphia Federal Credit Union, at least 47 employees belonging to one of the city’s labor union groups stopped working on April 11, picketing the increase and also what some are calling “unfair” labor practices. PFCU is one the largest credit unions in the state with 98,372 members and $470 million in assets. At issue is PFCU’s change in health care coverage through its provider Blue Cross/Blue Shield. Last September, the provider informed PFCU that due to rising health care expenses, administrative costs would increase. PFCU had previously paid 100% of healthcare benefits for all of its employees. The credit union sent out a memorandum to all employees alerting them of the possible change in costs they may have to pay and that PFCU would continue to negotiate with Blue Cross/Blue Shield on other options, said Karen Eavis, PFCU’s vice president of marketing. “We were hit with a 36% increase from our health care provider when we typically budget for a 6 to 10% increase,” Eavis said. “This was a big surprise, we continued to go back and forth with Blue Cross but, unfortunately, there wasn’t room in our budget to meet that increase.” Eavis said PFCU will continue to pay 100% coverage for all employees and their families until July 1. From there, the credit union will still pay full coverage for employees but not for spouses and children. Employees will have to pay 20% of insurance costs for children and 50% for spouses. It is that new payment schedule that has riled some PFCU employees who are also members of Local 32 of the Office and Professional Employees International Union, said Steven Tully, the labor group’s secretary and treasurer. “Everyone is feeling the effects of higher healthcare costs, but at the very least, the credit union should look at options with other providers,” Tully said. Still, Tully emphasized the bigger issue is the charge the PFCU has been using intimidation and coercion tactics to get employees to resign their membership with Local 32. Approximately 25% of PFCU’s 205 employees belong to the union, Eavis said. While Tully would not say what proof he has that PFCU has been “forcing” employees to cancel their membership with Local 32, he said there was enough “significant evidence” that warranted filing a complaint with the National Labor Relations Board citing “unfair labor practices.” Eavis said only one employee resigned their union membership prior to the work stoppage. Meanwhile, several offers were on the table at press time from both sides. PFCU offered to: continue the 100% coverage until July 1; offer employees an HMO plan through Blue Cross/Blue Shield; offer up to $450 to each employee to help defray out-of-pocket healthcare costs for one year only; Tully said Local 32 representatives suggested either the credit union look to other providers for more cost-efficient options or continue with the 100% coverage until July 1 while PFCU seeks out other health-care choices. Both sides seemed to be moving towards the option of paying employees up to $450 to defray costs, but Tully said discussions broke down when PFCU would not talk about what might happen after the first year of providing assistance. “We recognize the trend with rising healthcare costs, but to our knowledge PFCU agreed to contract with Blue Cross and never looked at any other options,” Tully said. Ironically, of Local 32′s 6,500 members, several work at Horizon Blue Cross and Blue Shield, a division not directly aligned with the provider PFCU contracts with, Tully said. At least one union group, the Security, Police & Fire Professionals of America (SPFPA), No. 511 is supporting Local 32. Dwight Duley, SPFPA’s president sent a letter to PFCU’s chief operating officer, Michael McAllister reminding him that “a large percentage of (No. 511) belongs to the credit union,” and suggested “maybe it’s time that labor organizations put together a slate of candidates to run for leadership positions within the credit union who will be fair to its employees.” Duley told Credit Union Times that his main concern is getting employees back to work because of the “devastating effect it can have on them and their families.” “At the same time, this must be a real serious issue for them to end up on strike,” said Duley, a member of PFCU for nearly 20 years. “If the credit union is going to pass on the healthcare costs to employees then they should at least get a raise out of the contract.” Eavis said she is “confident” that all sides will be satisfied in the end and the credit union will continue to operate all six branches during normal business hours including Saturdays. In March, employees were cross-trained to handle front-end teller and call center duties in the event a work stoppage would occur. -</p> <p>[email protected]</p>