Public employees unions won a major victory last week when the Michigan Court of Appeals struck down an action taken under Gov. Granholm to require a three percent contribution from all state employees to their retiree healthcare funds. You can see the full ruling here.
The Michigan Civil Service Commission approved collective bargaining agreements with all of the major unions representing state employees that included a three percent increase in wages for fiscal year 2010-2011. During the budget battles of 2010, the legislature tried but failed to pass legislation overruling that wage increase, but did pass a bill requiring all state employees to contribute three percent of their salaries to their own retirement healthcare funds.
That bill, however, passed by a majority vote while the constitution requires a 2/3 vote of both houses of Congress to overrule Civil Service Commission decisions. The circuit court ruled that action unconstitutional and the court of appeals has now agreed with that ruling, saying:
Mich Const 1963, art 11, § 5 provides that the rates of compensation for all classified service employees is fixed by the commission. It further sets forth the process for a legislative override of any wage increase submitted to the Governor by legislative majority vote of 2/3 of its members. In the present case, the Legislature did not achieve its goal in preventing the wage increase in accordance with the constitutional provisions. Therefore, it enacted MCL 38.25 to fill a budget deficit. When a statute contravenes the provisions of the Michigan Constitution, it is unconstitutional and void.
The state is likely to appeal to the Michigan Supreme Court.