The Corner

Obamacare Costs Fuel Union Tension in Upcoming Labor Talks

With the Affordable Care Act set to raise costs by millions of dollars for union workers across the country, employers and labor unions find themselves struggling to reach agreements in negotiations over who will shoulder the costs amid uncertainty surrounding the law. For some, the increases are coming as a surprise.

“When we first supported the calls for health-care reform, we thought it was going to bring costs down,” one labor lawyer told the Wall Street Journal.

The law’s impact on labor talks is affecting employees ranging from Alaska Airlines flight attendants to Las Vegas casino hospitality workers to Philadelphia transit-system employees. Among the reasons for the cost increases are the requirement that employees’ kids up to 26 years old be covered, and the “Cadillac tax,” a tax on premium plans, according to the Journal.

Many unions that backed Obamacare at its inception are now increasingly skeptical as their workers are being asked to pay more for their plans to cover the increases from the incoming costs.

Philadelphia transit employees turned down a deal that would have required them to contribute an additional 1 percent towards their health coverage. Alaska Airlines flight attendants voted down a proposal for not providing enough protection against potential future cost increases.

“It’s been a challenge for even some of the stronger unions to maintain the quality health plans that they have offered over the years,” another lawyer said. In other cases, unions are cutting coverage for certain employees altogether in order to preserve the plans for other workers at a manageable cost.

“On a broad level, the biggest challenge facing all our negotiations is certain provisions the Affordable Care Act is demanding on plans,” said a spokeswoman for United Food and Commercial Workers, which cut coverage for part-time employees to ensure it for full-time workers.

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