Senate Republicans took strategic action to protect both the state employees on the front line of the COVID crisis and the state’s budget with a modified contract approval. HF2796, authored by Senator Mark Koran (R-North Branch), ratifies the first year of the contract and puts in place a wage freeze for the second year that begins July 1, 2020. The 2.5% raise for the second year of the contract would be restored for state employees if the state achieves a budget surplus by July of 2021.

“We are all in this together,” said Senator Bruce Anderson (R-Buffalo). “This is not an easy choice but one that must be made as we face a potential deficit. Our state has to function as a business and while this is not an easy decision, we are taking this action now to avoid layoffs as we move forward through the wake of this pandemic.”

“The whole state of Minnesota is hurting right now,” said Koran. “There are 650,000 people unemployed across the state, businesses are closing for good, and people are losing their livelihoods every day. The bill today is fair to every Minnesotan, both state employees and the taxpayers.

State employee union contracts were scheduled to provide a 2.5% raise across the board, however, record unemployment and a projected $4 billion loss of revenue over two months have shifted the priorities of the 2020 session.

In a letter written last week to state employee union leaders, Majority Leader Paul Gazelka (R-East Gull Lake) said, “These are unprecedented times that call for unprecedented solutions. I appreciate that your contracts were negotiated in good faith last year before anyone could imagine the damage a virus could do to our economy and the state budget. But in light of recent events, the proposed contracts are not sustainable and if approved as is will lead to greater employee layoffs next year. I don’t want that to happen.”

Without any action by the Senate, state employees would face a 2.25% cut in pay, retroactive to last July. “That would be completely unfair,” said Gazelka. “State employees are not at fault here. We’re just trying to make the best of what could be a disastrous situation: either face a very harsh pay cut, or layoffs at the state to manage a deficit. Today’s modified ratification is the commonsense, fair solution for every Minnesotan.”