MUSKEGON, MI — Muskegon Public Schools custodians and maintenance workers have agreed to take a 5.5 percent pay cut in order to save their jobs from being privatized, according to The Muskegon Chronicle.
The cut, which totals approximately $180,000, is part of a new three-year contract negotiated with the district, the article stated.
According to the article, total savings from the contract are more than $250,000, and include not filling a vacant custodial position and complying with a state law that caps how much the district can pay for employee health insurance.
"It was a pretty difficult pill for some of them to swallow," said Betty Savage, assistant superintendent for human services.
"The district could have saved $750,000 if it chose to privatize the bargaining unit’s 90 positions. Instead union bargainers were told that it needed $239,000 in concessions," said Superintendent Jon Felske.
As a result of the agreement, the lowest salaries in the bargaining unit will drop from $10 per hour to $9.45, while the highest will drop from $20.88 to $18.85, the article noted.
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Are pay cuts a legitimate way to save money for employers in order to keep jobs, or do they set a certain precedence to threaten with privatization?