A union leader says a severance package for union workers will cost the union $200 million.
President Leo Baehr, who is also president of the Service Employees International Union, said in a statement Monday that his union’s board agreed to a $20-million severance payment to the union in the wake of the federal budget cuts.
That $20m represents about 6 percent of the union’s total $2.4 billion in annual dues, BaeHR said in the statement.
The $20M will be split equally between the union and the Department of Labor, which is responsible for determining union pay.
The union has been demanding a higher severance rate, to be set by the department, to bring the union into line with other unions.
The department has said it has no intention of raising the severance figure, and that the union will still receive at least some of its severance.
BaeHR’s statement comes after the union announced in February that it was filing for Chapter 11 bankruptcy protection, citing the “unimaginable impact” of the budget cuts and the inability of the administration to pay for overtime and benefits.
The federal government is set to provide $10.4 million to help cover the union costs, and $3.3 million in additional money for the state’s health care program.
The union’s contract with the federal government expired in 2017.