Detroit Free Press, Patricia Beck, Associated Press
Councilwoman JoAnn Watsun discusses a financial stability agreement at a 4 p.m. council meeting in Detroit on Thursday, March 29, 2012. Recently negotiated labor contracts could be nullified under terms of a financial stability agreement between the city of Detroit and the state that was being debated Thursday by the City Council.

DETROIT — Like clock hands spinning backward, Sandy Gajewski's pay is moving in the wrong direction, and the fire-engine painter doesn't know where her pay will bottom out under a proposed consent agreement between the city and state.

The 53-year-old Gajewski and many other Detroit municipal union workers say they've been backed into a corner by the consent deal that would nullify recently ratified pay, benefits and pension concessions — and it could change the landscape of future collective bargaining deals in the city.

"I'm in skilled trades and I make less than $20 an hour. With the concessions, I'd make $2 less," Gajewski told The Associated Press on Friday. "That's going to take me back to the Year 2000 wages."

The City Council is debating the financial stability agreement being negotiated by Mayor Dave Bing and Gov. Rick Snyder, and must sign off on it before the deal is complete.

If an agreement isn't reached by next Thursday, Snyder will have to decide whether to appoint an emergency manager with sweeping powers to run Detroit. The city would have until April 13 to appeal.

Union members and some on the City Council describe the proposed consent deal as heavy-handed and anti-union.

Snyder has insisted that he supports organized labor, but believes contracts of Michigan's public employees need to be more in line with those in the private sector of a state that has yet to recover from a recession.

Detroit faces a $200 million budget deficit and more than $13 billion in long-term structural debt.

The concessions negotiated by Bing with the unions are expected to save the city about $20 million this fiscal year, but Snyder has said they don't cut deep enough.

Snyder also is seeking changes to collective bargaining that could result in job losses and would keep current pay from reverting back to previous levels. Those provisions also call for new hires pay more for retirement health care.

"It's an outrage and an insult to have unions once again on the chopping block," Councilwoman JoAnn Watson said Thursday during a heated meeting on the consent deal.

But until Detroit leaders make some hard decisions, nothing will further the city's restructuring, said Patrick O'Keefe, chief executive of Michigan-based O'Keefe & Associates Consulting.

"The unions have done a beautiful and masterful job of protecting their employees," said O'Keefe, a turnaround specialist. "However, the cost of that protection has become prohibitive to taxpayers who are now saying 'uncle.' "

Snyder already has signed legislation requiring some state workers to contribute more toward their pensions. The governor and GOP lawmakers also want most public school employees to put more of their pay toward pension costs.

Michigan unions are trying to collect at least 322,609 voter signatures by early July to put a proposed constitutional amendment before voters that would enshrine collective bargaining rights in the state constitution.

It's a pre-emptive strike against a possible right-to-work movement, following union-fueled initiatives in Ohio to turn back a state law that curbed collective bargaining rights for public employees and an ongoing attempt in Wisconsin to recall the state's Republican governor.

"I think Snyder understands that collective bargaining for government employees has backfired and needs to be reined in," said Paul Kersey, director of Labor Policy at the Michigan-based Mackinac Center for Public Policy, a nonpartisan group that espouses free markets.

"Wisconsin has had more dramatic reforms than Michigan and so far they seem to be holding and working," Kersey said.

Detroit's union leaders have pledged to fight.

"The state is not giving the city of Detroit one doggone penny," Ed McNeil, special assistant to the president of AFSCME Council 25, said of Snyder's proposal. "The unions have come to the table and bailed out the city. The state is coming in and saying 'We don't like the deal' because their needs to be some work rules. The state should not have any involvement in this stuff at all."

The unions are part of a court challenge to decisions made by a state-appointed review team that has determined "severe financial stress" exists in the Detroit. A judge has ruled the team violated the state's Open Meetings Act. A hearing on the matter has been scheduled for April 9.

"Unions are not to be underestimated. They represent a lot of workers and a lot of votes," O'Keefe said. "They're not afraid to flex some muscle to do it. But if the average taxpayer in a down economy is looking to pay for government employees to have a better benefit structure than he has, how long can he afford to do that?"


Associated Press Writer Kathy Barks Hoffman in Lansing contributed to this report.