State workers' group frets about impact on state services in Haslam buyout of 700

NASHVILLE - Some 700 state workers out of nearly 2,100 who were eligible for Gov. Bill Haslam's employee-buyout offer took retirement incentives and headed for the door last month.

Administration figures show 2,068 employees - some facing layoffs - in 25 departments or agencies were offered buyouts. Of those, 829 applied for buyouts and 701, or just under 34 percent, accepted them. Most were gone as of July 31, figures show.

Workers from the Transportation Department accounted for 197 people - 28 percent of the total. Coming in at No. 2 were employees at the Human Services Department, where 126 workers took buyouts, according to figures supplied by the Human Resources Department at the Times Free Press' request.

Labor and Workforce Development workers were third with 53 employees, closely followed by the Revenue Department, with 51.

Haslam administration officials won't say much of anything about how much the taxpayers paid for the buyouts or the long-term effects on the budget. That wasn't the point, they insist.

"I want to reemphasize the purpose of the buyout," Human Resources spokeswoman Ashley Fuqua said in one email. "The buyout was designed not as a cost saving measure, but rather as a means to facilitate the effective and efficient operations of State Government. Any savings recognized by the buyout will be used towards agency's FY17 budget targets."

Finance Department spokeswoman Lola Potter explained in a Friday email that "from the state budget perspective, there was/will be no [overall fiscal] impact from the buyout. Departments are managing the issue internally."

Potter said that "any reduced salary/benefit expenditure an agency receives will be rolled back into the department's budget."

The buyout package included four months of base salary plus $500 for each year of service, plus six months of subsidized health insurance and up to $15,600 in tuition aid at state colleges and universities. Tuition benefits expire in June 2018.

The Tennessee State Employees Association, which advocates for state workers, is "concerned about our state's ability to continue providing quality services to our citizens over the long term," president Bryan Merritt said in an email.

He cited figures showing that since fiscal 2010-11, the year Haslam took office, the state has eliminated 3,311 posi­tions - not including the buyout. Meanwhile, state population has increased by 200,000, Merritt said.

With an estimated 17,000 - 40 percent - of state workers eligible for retirement in five years, Merritt warns of a "potential staffing crisis in the coming years."

Moreover, Merritt said, the administration "this year made state jobs less attractive by cutting longevity and retiree insurance benefits for all incoming state workers. Now the state has sent another 700 workers home. We are very concerned about the impact this will have on services in Tennessee."

Looming layoffs?

While the state's buyout website had specifically warned the program was partly aimed at heading off "likely" layoffs in some agencies, administration officials on Friday didn't directly answer questions on whether the response rate reduced that likelihood.

Republican Gov. Bill Haslam

Haslam spokesman David Smith instead referred a reporter to comments made in June. Haslam said the buyouts are part of his ongoing efforts to restructure state government. Many offers were based on job classifications that had become either obsolete or require far fewer people, he said.

"We hired you to do X position and we had 20 of those, and we think we just need 15 of those now, due to technology or whatever," Haslam said. "So we're re-examining state government like that, and where there are positions we say we don't need anymore, those are the positions where we're doing voluntary buyouts."

He said no specific number of jobs was targeted. But the Human Resources website noted that "If an insufficient number of eligible employees voluntarily separate from employment in certain agencies, those agencies will likely have involuntary terminations."

And officials said the incentives wouldn't be offered.

Documents supplied by Human Resources indicates some departments were up front about what would happen. For example, the state Department of Correction showed six custodial positions at the Tennessee Correction Academy in Tullahoma were to be abolished. All six of those workers were among the 22 Correction employees who took the buyout.

And the Tennessee Department of Environment and Conservation, at least in the case of one Chattanooga-based auditor, expressly cited "RIF"- reduction in force, or layoff - if the employee didn't take the offer.

In the Transportation Department, where 197 workers took buyouts, officials embarked on massive reclassifications of job titles affecting targeted positions. Positions were downgraded and upgraded.

One former employee who took the buyout told the Times Free Press that at least some downgraded positions resulted in pay cuts. And at least some upgraded job classifications came with new qualifications, such as a more advanced degree. Some affected workers just couldn't qualify, the now-retired employee said.

A few other employees got a nasty surprise when their checks should have arrived, Merritt said.

He said some workers who were in a Chapter 13 bankruptcy repayment plan "received a notice that their entire lump sum buyout payment would be sent to their bankruptcy trustee's office."

Merritt said officials in Human Resources and Tennessee Attorney General officials explained that the lump sums were considered "part of the employee's estate" and therefore must be sent to their bankruptcy trustee.

TSEA officials "believe there should have been specific information included in the [program's Frequently Asked Questions section] to warn employees about payment for those in bankruptcy, along with other mandated deductions," Merritt said. That might have affected some employees' decision of whether to accept the buyout, he said.

Those affected "now have to wait several weeks before they receive their buyout payment, or any portion of that payment," Merritt added.

Contact staff writer Andy Sher at asher@timesfreepress.com or 615-255-0550.