The Chicago Employment Law Blog

Public Schools on the Verge of Insolvency Choose to Spend More

What would you do if you were down to your last few dollars in savings? Your bills are high, you are barely making your current payments, and soon, you won't be able to make those payments at all.

You'd spend more money, right?

That's exactly what the Chicago Public Schools are planning to do, reports the Chicago Sun-Times. They are planning an across-the-board two percent pay raise for every employee in the district.

A little context is necessary to understand the reasoning behind such a questionable decision. There is a teacher's strike on the verge of happening over a demand for more pay. The Chicago Teachers' Union thinks the 2% raise is not enough and was initially asking for 29%. They are already arguably the highest paid teachers in the nation, reports CBS Chicago.

You migth be thinking that the teachers are being a little greedy. After all, the district has a $665 million deficit as-is. The state deficit is some incomprehensible number, so they're going to be of no use in bailing the district out if they go bankrupt. Plus, the district is projected to have a $1 billion deficit next year.

In the teachers' defense, the recent reforms under the Rahm Emanuel administration have resulted in a 20 percent increase in the length of the school day and school year, reports the Sun-Times. If your boss asked you to work 20 percent more for the same pay, you would probably want a raise as well.

Then again, did we mention next year's $1 billion shortfall in the CPS budget?

The justification for CPS' proposed fiscally-unsound policy is that "we have to invest in students now" and they can raid their "rainy day" fund to cover most of the shortfall. They will also be raising property taxes to the maximum allowable by law.

What they can't say is that the move might just be a part of the ongoing negotiations with the teacher's union. According to the Sun-Times, the two percent raise is only a proposal, made contingent on settling things with the CTU.

Due to budget constraints, any additional concessions to the teachers in the upcoming negotiations would probably mean less of a raise for everyone else. The idiotic raise might have been a deft strategic move that made it in everyone else's interest not to support the teacher's strike.

Another logical justification for a 2% across the board raise could be bargaining in good faith. In a previous posting, we mentioned that the CTU's authorization of a strike so early in the negotiating process might be considered as proof that they were not negotiating in good faith, which is required by the National Labor Relations Act .

By straining the budget as far as possible, CPS might be trying to prove that the district is negotiating in good faith. After all, it is hard to argue that you're doing everything you can to close the gap when you are sitting on a few hundred million dollars.

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