Local 21 Members Approve San Jose Measure B Settlement Tentative Agreement

Our San Jose Members overwhelmingly voted to ratify a framework to settle litigation over the City's contentious, illegal Measure B.  This Settlement Framework is the culmination of exhaustive efforts over the past four years by IFPTE Local 21 and our three chapters: the Association of Engineers and Architects, the Association of Maintenance Supervisory Personnel and the City Association of Management Personnel. 

Measure B was part of Mayor Reed's attempt to eliminate vested rights and gut the pension benefits of San Jose City employees. Despite reform proposals from City Unions, the City Council placed the initiative on the June 2012 ballot where it was approved by voters.  Litigation ensued.  We warned that Measure B would destroy City departments and services and it has.  We have fought vigorously, on many fronts, to overturn it and  This Settlement Agreement does that.  Thank you to our membership for its unwavering support through this battle.

The Settlement Framework creates a competitive Tier 2 for newer hires; and it responsibly protects the Tier 1 retiree healthcare benefit and creates a sensible alternative for Tier 2 employees, with an opportunity for Tier 1 Members to opt-in to it.

Read the Tentative Agreement Settlement Framework here. Also, here and here are summaries of key provisions.  Thank you to Local 21 Attorney Christopher Platten for providing a detailed look at the agreement in this video:

It is a complex agreement and at this stage remains a Framework.  Much work remains.

Key provisions of the Framework:

  • It INVALIDATES Measure B, striking it from the Charter and ending litigation. 
  • It creates a COMPETITIVE, VESTED Tier 2 benefit, with an accrual formula of 2% per year of service with a normal retirement age at 62.
  • It RESTORES Tier 1 and Tier 2 disability benefits to the standards that existed prior to Measure B
  • It PROTECTS Retiree Healthcare and reduces its cost from 8.76% (and the upcoming increase to 10.47%) to 7.5% and installs a floor for retiree medical benefits that cannot be lowered

a.     Tier 1 employees will have a one-time opportunity to opt-out of the City's retiree healthcare benefit and opt-in to the VEBA with their contribution rate dropping to 4.5% and their previous contributions made for retiree healthcare placed into their individual VEBA accounts 

b.    Tier 2 employees will have a new, portable defined contribution retiree healthcare benefit (VEBA) which they will control and fund at 2%

  • Lateral employees (including former employees) who qualify as "classic employees" under state law (i.e., they were an employee before 1/1/13) may join or rejoin the City as Tier 1 workers (this includes former San Jose Tier 1's who have returned as Tier 2) 
  • Retirement benefits will be protected in a 10-year Retirement MOA (i.e., until 2025)