Michigan's Public EMPloyEE RElations act - Mackinac Center
Mackinac Center for Public Policy 24Executive SummaryThe Michigan Public Employee Relations Act, which governs collective bargainingbetween local governments and their employees, is simultaneously among themost important and least-discussed laws ever passed by the Michigan Legislature.Because the work of public employees is the work of government, PERA affectsnearly every aspect of local government operations.PERA was based on the National Labor Relations Act, a law that was designed forprivate, for-profit employers. The NLRA has not always worked well in the privatesector; applying the structure of the NLRA to government has created even morecomplications:• The incentives created by PERA tend to push local officials toward taxincreases rather than spending cuts.• Unless local officials are prepared for a bargaining impasse, unions havean effective veto over any part of a local government’s budget dedicated topersonnel costs. Personnel costs can make up as much as 80 percent of a localgovernment’s budget.• Work rules found in collective bargaining agreements add to the scope ofthe “union veto.” In practice, government union negotiators can manipulateany political issue that can be expressed in terms of employee compensation,job duties or work standards and be included in a collective bargainingagreement.• Court rulings have consistently held that collective bargaining trumps localstatutes and even local charters. PERA has arguably subverted the home-ruleprinciples expressed in the state constitution.• With agency fees effectively granting millions of dollars in guaranteedrevenue to unions with strong political tendencies and little financialaccountability, it would be fair to say that PERA has created a permanent,taxpayer-funded lobby for big government.The government employee unions created by PERA may be the single largestobstacle to restoring the state’s prosperity. Collective bargaining for governmentemployees is not an inalienable right, and its practice in Michigan has addedbillions of dollars to the cost of government. The repeal or restructuring of PERAcould resolve the state’s chronic fiscal crisis. PERA is long overdue for a thoroughre-examination, leading to the rewriting or repeal of the law.
Board of DirectorsD. Joseph Olson, ChairmanRetired Senior Vice Presidentand General Counsel,Amerisure CompaniesJoseph G. Lehman, PresidentMackinac Center for Public PolicyLawrence W. ReedPresident Emeritus,Mackinac Center for Public PolicyJoseph J. FitzsimmonsRetired President,University MicrofilmsHon. Paul V. GadolaU.S. District Court JudgeKent B. HerrickPresident and CEO, ThermogyRichard G. HaworthChairman Emeritus,Haworth, Inc.Phil F. JenkinsChairman, Sweepster Inc.Edward C. Levy Jr.President, Edw. C. Levy Co.Rodney M. Lockwood Jr.President, LockwoodConstruction Company, Inc.Joseph P. MaguirePresident, WolverineDevelopment CorporationRichard D. McLellanAttorney, Dykema GossettJames M. RodneyChairman of the Board,Detroit Forming Inc.Board of ScholarsDr. Donald AlexanderWestern Michigan UniversityDr. William AllenMichigan State UniversityDr. Thomas BertonneauWriter and Independent ScholarDr. Brad BirzerHillsdale CollegeDr. Peter BoettkeGeorge Mason UniversityDr. Theodore BolemaAnderson Economic GroupDr. Stephen ColarelliCentral Michigan UniversityAndrew CoulsonCato InstituteRobert CrownerEastern Michigan University (ret.)Dr. Richard CutlerUniversity of Michigan (ret.)Dr. Jefferson EdgensBrewton-Parker CollegeDr. David FelbeckUniversity of Michigan (ret.)Dr. Burton FolsomHillsdale CollegeDr. Wayland GardnerWestern Michigan University (ret.)John GretherNorthwood UniversityDr. Michael HeberlingBaker CollegeDr. Ormand HookMecosta-Osceola Intermediate SchoolDistrictRobert HunterMackinac Center for Public PolicyProf. Harry HutchisonMason School of LawDr. David JandaInstitute for PreventativeSports MedicineAnnette KirkRussell Kirk Center forCultural RenewalDavid LittmannMackinac Center for Public PolicyDr. Dale MatcheckNorthwood UniversityDr. Paul McCrackenUniversity of Michigan (ret.)Charles MeiserLake SuperiorState University (ret.)Glenn MootsNorthwood UniversityDr. George Nastas IIIMarketing ConsultantsDr. John PaffordNorthwood UniversityDr. Mark PerryUniversity of Michigan - FlintGregory RehmkeEconomic Thinking/E Pluribus Unum FilmsDr. Steve SafranekAve Maria School of LawLouis Schimmel Jr.Mackinac Center for Public PolicyDr. Howard SchwartzOakland UniversityJames SheehanDeutsche Bank SecuritiesRev. Robert SiricoActon Institute for theStudy of Religion and LibertyDr. Bradley SmithCapital University Law SchoolDr. John TaylorGrand Valley State UniversityDr. Richard K. VedderOhio UniversityProf. Harry Veryser Jr.University of Detroit MercyJohn Walter Jr.Dow Corning Corporation (ret.)Dr. William WilsonEconomic ConsultantMike WintherInstitute for Principle StudiesDr. Gary WolframHillsdale College