The Mills administration requested the help of a professional mediator Monday to resolve a contract dispute with the state’s largest public employee union over higher wages and benefits.

State officials say they are committed to addressing the pay gap identified in a 2020 study, but remain “hundreds of millions of dollars apart” concerning the demands of the Maine Service Employees Association, Local 1989 of the Service Employees International Union, which represents about 13,000 state workers.

The union held a demonstration in Augusta over Labor Day weekend, circling both the Blaine House and the State House, honking horns and calling on the administration to address the wage gap.

The administration requested mediation through the Maine Labor Relation’s Board, which seeks to resolve contract disputes, after three months of negotiations failed to result in a new contract.

A 2020 study found that some state employees then earned 15% less in compensation than their peers in the private and public sectors.

Kirsten Figueroa, commissioner of the Department of Administrative and Financial Services, which oversees budget issues, said the administration wants to increase pay to make state government “an employer of choice” for potential workers.

“We are striving to become Maine’s employer of choice, and we know that involves competitive compensation and an attractive benefit package,” Figueroa said in a written statement “That’s why, over the past several years, we have made substantial strides in closing the wage gap and improving benefits. We strongly want to continue to make progress within our budgetary constraints. It is our hope that an impartial perspective can help both sides realize a final agreement that works for all parties involved.”

Union officials said in a written statement they were not surprised by the mediation request.

“Given the state’s intransigence so far on closing the state employee pay gap at the bargaining table, we’re not surprised that the state would ask for the intervention of a mediator in the executive branch contract negotiations,” the union said in a written statement to the Press Herald.

“Whether the state negotiates directly with state workers or through a mediator, there’s no way of sugarcoating the fact that state workers for decades have been substantially underpaid compared to their public and private sector counterparts throughout Maine and New England.”

While Figueroa highlighted budget constraints, union officials have pointed to historic state revenues and surpluses, saying the conditions are ripe to address the wage gap now. Open positions have caused increase workloads on existing employees, including child safety workers, ferry captains, plow truck drivers and others, they said.

During the Labor Day rally, union officials talked about state employees who qualify for income-based programs such as the Supplemental Nutritional Assistance Program and MaineCare, the state’s Medicaid program.

“It’s not that the state doesn’t have the money to pay us,” union President Dean Staffieri said in a written statement over Labor Day weekend. “The state has a record budget surplus – and the Rainy Day Fund is maxed out. No, all that’s missing to solve this problem is for the state’s negotiating team to provide us a wage proposal that closes the pay gap.”

The current state budget includes nearly $100 million to address the wage gap among state employees. The administration said another round of bargaining will begin after lawmakers receive the ongoing classification and compensation report in January, noting those negotiations are “separate and distinct” from the current round and “subject to availability of funding.”

The administration said that Mills has increased worker pay by 14% over her term, which they said was 40% more than state workers had received in the decade preceding her term. Her administration also noted efforts to establish a four-week paid parental leave program, a starting pay increase to $15 an hour, a $2,000 one-time payment to state workers and improved longevity pay for people who have worked for the state for more than a decade.

The administration noted that, after months of negotiating, “the state and the union remain hundreds of millions of dollars apart.”

When asked about the status of negotiations on Maine Public’s “Maine Calling” program Thursday, Mills reiterated her administration’s commitment to negotiations.

“I fully respect the process of collective bargaining and what it takes to stay at the table and negotiate forthrightly and fairly and in a civil manner,” Mills said. “We’re committed to fair compensation for state employees. Clearly we are.”

She added, “But I want to be creative about this and talk about benefits as well – and that’s what’s on the bargaining table as well.”

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