IN THE CIRCUIT COURT OF THE 20TH JUDICIAL CIRCUIT ST. CLAIR COUNTY, ILLINOIS American Federation of State, County and Municipal Employees, Council 31; Plaintiff, Case No. 16-CH 302 State of Illinois, Department of Central Management Services; Defendant. VERIFIED AMENDED COMPLAINT FOR DECLARATORY AND INJUNCTIVE RELIEF This is a lawsuit between the largest union representing State employees and the State of Ilinois, Department of Central Management Services (“CMS”). It is brought pursuant to Section 16 of the Illinois Public Labor Relations Act, 5 ILCS 315/16, which provides that circuit courts have jurisdiction over actions for the violation of collective bargaining agreements, It seeks 10 enforce the provisions of a collective bargaining agreement named the “Tolling Agreement and Declaration” between Plaintiff and Defendant and legal and equitable relief for its breach, The Plaintiff complains against the Defendant as follows: L PARTIES 1. Plaintiff American Federation of State, County and Municipal Employees, Council 31 (“AFSCME” or “Council 31") is a union that represents employees of the State of Illinois. with respect to their wages, hours, and terms and conditions of employment. APSCME 1Council 31 is the exclusive bargaining representative of approximately 38,000 employees of the State of Illinois who work in approximately 51 departments, boards, authorities, and/or commissions that are subject to the authority of the Governor. 2. The employees represented by Council 31 work in prisons, mental health facilities, facilities for the developmentally disabled, veterans homes and in the offices that administer State programs such as public aid, unemployment insurance, public health and child welfare, These facilities and offices are located in every part of the State. Nearly every county in the State has State employees represented by Council 31 who live or work there, Council 31 represents hundreds of employees who work for the State in St. Clair County at more than a dozen different facilities and offices. 3. Plaintiff AFSCME Council 31 is a party to a Master collective bargaining agreement with the State of Illinois, Department of Central Management Services, with effective dates from July 1, 2012, to June 30, 2015 (“the Master Agreement” or “the 2012-2015 Agreement”), The main portion of the Master Agreement and Appendix A to the Agreement are attached hereto as Exhibit 1. 4, — Defendant State of Illinois, Department of Central Management Services (“CMS”), is a public employer as defined by the Illinois Public Labor Relations Act, 5 ILCS 315(0). CMS maintains offices in many regions of the State and has an office in St. Clair County. It is also ultimately responsible for labor relations at the facilities and offices of the State wherever they are located. CMS represents the State of Illinois in collective bargaining. 5. On June 25, 2015, AFSCME and CMS entered into a “Tolling Agreement and Declaration (“Tolling Agreement”). In the Tolling Agreement, AFSCME promised to refrain from a strike, work stoppage or work slowdown between July 1, 2015 and July 31, 2015. CMSpromised that it would not lockout employees during that same time. In addition, the Tolling Agreement states that “all legal and contractual rights that exist on June 30, 2015 shall remain in effect during the term of this Agreement.” In July 2015, AFSCME and CMS entered into a second Tolling Agreement which extended the first Tolling Agreement to either September 30, 2015 or until the parties reached a lawful impasse in their negotiations for a new contract, whichever came later. In September 2015, AFSCME and CMS entered into a third Tolling Agreement which states that “all legal and contractual rights that exist on June 30, 2015 shall remain in effect during the term of this Agreement” while the parties bargain a new successor collective bargaining agreement. These Agreements are attached as Exhibits 2, 3, and 4 respectively. 6. Each of the Tolling Agreements has the following provisions. First, the Agreements contain an agreement by the parties “to continue meeting and negotiating in good faith for a successor collective bargaining agreement.” Second, the Agreements state that they will remain in effect “until impasse is reached” and that “if a dispute exists with respect to the existence of an impasse, the parties agree to submit the matter to the Illinois Labor Relations Board CTLRB”) 7. Prior to the negotiation of the Tolling Agreement in September 2015, Governor Rauner wrote a letter to State legislators regarding his “proposal” for what would become the final Tolling Agreement. After stating that the Tolling Agreement was an “enforceable, binding contract,” the letter states that “under the terms of that agreement, impasse requires a mutual agreement by both sides that further negotiations would not be fruitful” and that the agreement precluded the State “from unilaterally imposing a new contract on state employees.” The letter continued by stating that if there was a disagreement over whether an impasse existed, “theLabor Relations Board can require both sides to continue negotiating, and their decision is subject to judicial review in state court. Until that dispute is resolved, the tolling agreement continues to apply.” This letter is attached hereto as Exhibit 5. Tl. FACTS: 8. ‘The Agreement between AFSCME and CMS has a “step plan” which, in part, determines the wages of bargaining unit members. According to the Agreement, this current step plan is effective July 1, 2014. Members move through the steps on the anniversary date of their employment with the State in their current title for several years until they receive full seale, The current step plan has eleven steps. CMS has refused to pay employees for their step increases since July 1, 2015. In addition State employees covered by the AFSCME Agreement eam salary increases as they progress through their levels of their classification series by virtue of their time in each title of the series and their increased job responsibilities. CMS has failed to fully compensate employees for such progression since July 1, 2015. Finally, the Agreement between AFSCME and CMS requires longevity increases for employees who are at the top step of the step plan, CMS has refused to pay longevity increases since July 1, 2015. 9. Pursuant to the State Employees Group Insurance Act, 5 ILCS 375/1 et seq., (“the Group Insurance Act”) the State and CMS administer a program of health insurance for all State employees and retirees and their families including those of State universities and of State offices and officeholders who are not subject to the Governor. The policy of the Group Insurance Act is to assure quality health care benefits to active and retired State employees and their families and to insure that participants in the program of insurance have continued access to the health care they have received over the course of their State employment from their health care providers. 5 ILCS 375/5. The program of insurance provided under the Group Insurance 4Act is intended to protect active and retired employees and their families against the rising costs of medical care and must include coverage for medical, surgical, and hospital expenses. 5 ILCS 37516. 10, The Group Insurance Act requires the State to pay the cost of the basic medical insurance program for each eligible participant in the program. 5 ILCS 375/10. 11, The State provides insurance under the Group Insurance Act in two different ways. One is to contract with Health Maintenance Organizations (“HMO’s) to provide medical services at a fixed cost per participant. 5 ILCS 375/5. The other is through a program of self insurance. $ ILC$ 375/6.2. The providers that provide medical care in the health plans in the self-insured program submit their claims to the State and are reimbursed for those claims. Together, these insurance programs cover approximately 350,000 active employees, retired employees and their family members. 12, As the exclusive bargaining representative of 38,000 State employees, AFSCME Council 31 has regularly bargained about the health insurance program for active and retired employees and their families. ‘This bargaining resulted in agreements between Council 31 and CMS regarding the type of insurance offered, the costs imposed under those insurance programs, and the amount of contributions to insurance premiums. The current program of insurance for State employees and retirees covered by the Master Agreement between AFSCME and CMS is set forth in Appendix A to the Agreement. 13. The State pays the claims for the self-insured plans and the premiums to the managed care organizations out of the Health Insurance Reserve Fund. The money in the Reserve Fund comes from legislative appropriations, e revenues and employee premiums,14. On September 11, 2015, CMS posted an “Informational Notice” dated September 9, 2015 on its website, This Informational Notice is attached as Exhibit 6. This Informational Notice contained the following statements: 15, That CMS was “in uncharted territory,” and that CMS believed that it would soon have no legal authority to pay health care vendors for their services; That since healthcare providers did not know when they would receive State reimbursement for they health care they provide, “a few” providers, Cigna, HealthLink OAP, Coventry OAP and Delta Dental “have asked our members to pay cash at the time of service.” That with respect to medical claims, “the provider will reimburse the member ‘once the provider receives payment for the services.” ‘That funds would be released for payment to providers once a budget is approved and “appropriate funding” is in place; ‘That notwithstanding the foregoing “the medical, prescription, dental and vision plan services will continue.” On September 15, 2016, CMS posted a notice in the “Claim Payment Delay” portion of the “Benefits” section of its website. This posting is attached as Exhibit 7 hereto. ‘This notice states that until “there is an approved FY ‘16 budget in place for the State of Illinois, claim payments for the Quality Care Dental Plan, administered by Delta Dental, the Quality Care Health Plan administered by Cigna, HealthLink OAP and Coventry OAP are on hold.” The posting goes on to state that benefits will be paid “once the State budget is approved and funds are provided to the plans.” 16. According to news reports, State reimbursement of providers in the self-insured program currently takes up to a year or longer. While the State has procedures in place to pay interest to providers who are not timely paid, it has no procedures in place to pay participantsinterest if they must pay cash for medical services and await reimbursement from medical providers. 17. Due to the budget impasse, medical providers are now either asking state employees to pay “up front” for medical services covered by their health insurance or closing due to lack of reimbursement from the State. T is means that State employees cannot obtain the medical care provided in their collective bargaining agreement, either because they cannot afford to pay for care “up front,” or because medical providers will no longer be able to provide services. Given the number of participants in the self-insured program, it is virtually certain that some individuals who forego health care will become debilitated as a result of doing so. 18, There is no guarantee that the General Assembly and the Governor will ever agree on a budget containing sufficient appropriations to pay for the claims that State employees may have in the 2016 and 2017 Fiscal Years. 19. Despite the State's failure to provide the insurance benefits required by contract and statute, the State is still deducting employee contributions for insurance from the earnings of State employees. 20. State employees in many classifications are required to travel extensively to perform their duties. The State has ceased regularly paying travel expenses. This means that some employees have unpaid expenses which exceed $10,000. In order to remain current and preserve their credit, employees have had to obtain personal loans to pay these travel expenses. II. VIOLATIONS OF THE TOLLING AGREEMENT 21, The Tolling Agreement and Declaration between Plaintiff AFSCME and Defendant CMS is a collective bargaining agreement within the meaning of the Illinois Public Labor Relations Act and Section 16 of that Act.22, The Tolling Agreement and Declaration provides that the “parties agree to continue meeting and negotiating in good faith for a successor collective bargaining agreement.” 23. CMS has violated the Tolling Agreement by refusing to continue “meeting and negotiating” with AFSCME since January 8°, 2016. On that day, CMS representatives presented a “Last Best and Final Offer” to the AFSCME bargaining committee and declared an impasse in bargaining, CMS representatives refused to consider new bargaining proposals that AFSCME had put forward that day, they refused to make any new proposals and they refused to schedule additional meetings. a) On January 14, 2016, in a letter to the Chief Negotiator for CMS, AFSCME informed CMS that it did not believe the parties were at impasse, that the parties should retum to the bargaining table and that the refusal to retum to the bargaining table was a violation of the Tolling Agreement. This letter is attached hereto as Exhibit 8, The Union received no response to that letter. b) On January 21, 2016, AFSCME informed CMS by letter again that it wanted to continue bargaining and that it believed the State’s refusal to do so violated the Tolling Agreement. This letter is attached as Exhibit 9. In response to the letter of January 21, CMS stated that it would not retum to bargaining because it did not believe bargaining would be fruitful. This letter is attached as Exhibit 10. ©) On February 11, 2016, AFSCME Deputy Director Mike Newman wrote to CMS Chief Negotiator John Terranova and requested information that the Union believed would be relevant to future bargaining between the parties. This letter is attached as Exhibit 11, Terranova has never responded to the letter. ‘The Union re-requested the information in the February 11, 2016 letter in a letter dated April 85, 2016. This letter is attached as Exhibit 12, Terranova did not respond to this letter. 4) On May 26, 2016 a group of legislators wrote a letter to Governor Rauner and to Roberta Lynch, the Executive Director of AFSCME, The letter urged the parties to resume negotiations. The letter stated that such action would honor the Tolling Agreement to the fullest extent. This letter is attached as Exhibit 13. e) In response to the letter of May 26, 2017, AFSCME Executive Director Lynch made it clear that the AFSCME Bargaining Committee was still ready to return to contract negotiations. She wrote to the legislators and stated that “AFSCME stands ready to return to the bargaining table and resume negotiations.” This response is attached as Exhibit 14, 4) In response to the letter of May 27, 2017, Governor Rauner's administration issued a press release that stated that “all formal negotiations have been suspended,” It further stated that “AFSCME’s unwillingness to move off their last best and final offer of more than $3 billion in financial demands is what is causing the impasse.” ) In fact, AFSCME had never made a “last best and final offer,” let alone one with $3 billion in financial demands. h) On June 6, 2016, AFSCME Executive Director Lynch wrote to Governor Rauner and informed him that AFSCME had never made a “last, best and final offer” and that APSCME was prepared to resume bargaining and to make new proposals to reach an agreement. This letter is attached as Exhibit 15. In addition, AFSCME Deputy Director Newman wrote to Chief Negotiator 9Terranova to request a return to the bargaining table. This letter is attached as Exhibit 16, i) Despite these letters, CMS did not offer to return to the bargaining table with the AFSCME Negotiating Committee. 24. CMS has violated the Tolling Agreement by failing to negotiate “in good faith” in the following ways: 2) It has refused and failed to provide information requested by the Union that is necessary for the Union to evaluate the impact of the State's proposals and to make counter proposals; ») It has insisted on its proposals and refused to significantly compromise on them; ) It has insisted on proposals that require the Union to waive its right to bargain with respect fo wages, health insurance and job security; 4) It has insisted on proposals that require the Union waive its right to act as the exclusive representative of the members it represents; ¢) It has sought to deal direcily with employees and circumvent the role of the union as the elected representative of the employees; 4) It has insisted on proposals that require employees to waive their statutory and constitutional rights regarding retirement benefits; and g) It has falsely claimed that the parties are at impasse in negotiations and refused to negotiate any further, based upon that false claim.25, The Tolling Agreement provides that “all legal and contractual rights that exist on June 30, 2015 shall remain in effect during the term of this Agreement.” CMS has violated this, provision of the Tolling Agreement by the following conduct: a) It has refused to pay employees the salaries they are due by virtue of their progression through the step plan contained in the collective bargaining agreement that expired on June 30, 2015; ) It has refused to honor the provisions of the Pay Plan for State employees which require additional compensation for employees as they accrue additional years of service; ©) It has failed to pay employees the salaries they are due by virtue of their semi- automatic in-series advancement and their longevity increases, even though required by the collective bargaining agreement in effect on June 30, 2015; 4) Ithas failed to pay employees the salaries they are due by virtue of their semi- automatic in-series advancement and their longevity increases, even though required to do so by the Pay Plan for State employees; €) It has refused to adhere to the provisions of Article 15 of the collective bargaining agreement with respect to the provision of benefits under the Upward Mobility Program; f) It has failed to regularly reimburse employees for employer required travel expenses that, in some cases, exceed $10,000 per employee; 2) By virtue of its refusal to pay medical providers for bills and premiums to insurance companies it has breached its statutory and contractual duty to maintainthe health insurance program specified by the collective bargaining agreement, the Tolling Agreement and the State Employee Group Insurance Act; hh) It has refused to comply with the provisions of the Tolling Agreement which require the parties to continue bargaining in good faith until the dispute over impasse is resolved by the ILRB; and i) CMS has announced that it believes that it has the legal authority to assess higher health insurance premiums retroactively if the ILRB upholds the State’s position that an impas in negotiations existed on January 8, 2016. This announcement is attached hereto as Exhibit 17. 26. The Tolling Agreement provides that it “remains in effect until impasse is reached.” It also provides that if the parties disagree about the existence of an impasse, the matter may be submitted to the ILRB. The Tolling Agreement further provides that the ‘Agreement will then remain in effect “until the ILRB resolves the issue.” 27. On November 15, 2016, the ILRB met to decide whether an impasse existed between the parties. It discussed the matter in a nearly three hour long meeting and voted to rule that an impasse existed on the issue of subcontracting and that the impasse on this issue was sufficient to allow the State to implement the terms of its “Last, Best and Final Offer” of January 8, 2016. It has not yet issued its written decision in the case. Following the oral ruling of the ILRB, Deputy Director Newman wrote to Chief Negotiator Terranova and informed him that the Union had new bargaining proposals, including one on subcontracting which “specifically addresses the issues raised by the ILRB on that issue.” That letter is attached as Exhibit 18. CMS has not responded to that letter.28. The oral ruling of the ILRB has no legal foree. Under the Open Meetings Act and the Administrative Review Act, only a written decision of the ILRB properly issued at an open public meeting has any legal validity, In fact, the IPLRA specifically states that the Board “shall issue and caused to be served” its orders in unfair labor practice cases. 5 ILCS 315/11(c). The TLRB has not issued and caused to be served its order in this ease. 29. Nonetheless, CMS has proceeded with implementation of its “Last Best and Final Offer.” On November 16, 2016, CMS announced that it is calculating the $1,000 bonus contained in its Final Offer on wages. It has announced that it is developing criteria for the administration of a merit pay program. It has announced that it intends to modify the overtime provisions of the 2012-2015 Agreement. It made these announcements directly to AFSCME represented employees without any notice to AFSCME. A true and accurate copy of the email sent to employees represented by AFSCME is attached as Exhibit 19. 30, The terms for the calculation of the $1,000 bonus which have been announced by CMS are more favorable than the terms contained in the “Last, Best and Final Offer” presented to AFSCME during contract negotiations. Specifically, CMS never offered to exclude all sick days and personal days from the definition of assigned work days during contract negotiations. 31. On November 17, 2016, the Governor has announced that the State intends to implement new rules regarding the use of volunteers to provide State services. The press release announcing the State’s intent to proceed on this issue is attached as Exhibit 20. This announcement claims that the State could implement such rules because of the ILRB decision. ‘At no time has CMS identified the provisions of the 2012-2015 which support this claim. This announcement was made directly to State employees represented by AFSCME, CMS did notgive AFSCME any advance notice of the announcement or of any new rules that it intends to implement with respect to the use of volunteers. 32. On November 18, 2016, officials from the Rauner Administration were quoted in fan article from the Chicago Sun Times as stating that the State did not need a written decision from the ILRB in order to proceed with the implementation of their “Last Best and Final Offer.” This newspaper article is attached as Exhibit 21. 33. On November 21, 2016, CMS announced the implementation of a new bereavement policy directly to AFSCME members with no prior notice to the Union. This announcement is attached as Exhibit 22. 34. On November 28, 2016, the Governor issued a press release announcing the creation of a Health and Safety Task Force and a Workplace Violence Task Force. CMS initially opposed the creation of both of these task forces in negotiations with AFSCME, but relented when the Union pressed these proposals in order to increase the health and safety of its members. ‘This press release was issued directly to the public with no advance notice to the Union, despite the fact that the Union must appoint representatives to the Task Forces. This press release is attached as Exhibit 23 35. On information and belief, Plaintiff believes that CMS will soon announce an “open enrollment period” for the participants in the group insurance program of the State. This open enrollment period will require employees and their families to choose between paying much higher premiums for their health insurance and enrolling in a plan that will have much higher out of pocket costs. 36. In August 2016, CMS emailed a video to employees represented by AFSCME that indicated that the State had an insurance proposal that would allow employees to pay the same “4premiums for health insurance and that the proposed insurance would not have many changes from the insurance currently in place. The video featured a conversation between John ‘Terranova, the Deputy Director of CMS for Labor Relations and Theresa Flesh from the Bureau of Benefits in CMS. A transcript of the dialogue in the video is attached as Exhibit 24. This video was directly emailed to employees represented by AFSCME, AFSCME has received no details regarding this altemative insurance plan, 37. In response to the video, AFSCME requested that CMS provide details regarding the proposed alternative insurance plan. This request is attached as Exhibit 25. CMS has never responded to this request for details about the terms and costs of the new plan it intends to offer to employees. 38. Based upon information provided to AFSCME during negotiations for a successor collective bargaining agreement, the Union estimates that the altemative insurance plan described by CMS will have an annual out of pocket maximum of over $12,000 for family insurance coverage. The current out of pocket maximum for the insurance under the Group Insurance Act in Appendix A of the 2012-2015 Agreement is $1,500 for individuals and $3,750 for families. 39, The actions set forth in paragraphs 29-38 violate the Tolling Agreement because the ILRB has not yet issued a legally binding decision. Consequently, the Tolling Agreement continues to prohibit the implementation of changes to the terms and conditions of employment connected to the “Last, Best and Final Offer’ of CMS absent notice to and agreement from AFSCME. The Tolling Agreement also requires CMS to act in good faith with respect to AFSCME by providing information related to the terms and conditions of employment and by communicating changes to the terms and conditions of employment to AFSCME prior to 15communicating those changes to the employees represented by AFSCME. The failure of CMS. to respond to AFSCME’s request for information about its alternative health insurance plan and the announcement of changes to the terms and conditions of employment directly to employees without any notice to their Union representative violates these requirements of the Tolling ‘Agreement. 40. The conduct described in the preceding paragraphs will continue unless enjoined by an order of this Court, Wherefore, Plaintiff requests the following relief: 2) That the Court declare that the Defendant has violated the Tolling Agreement and Declaration in the ways specified above; +b) That the Court enjoin the implementation of the provisions of the Last, Best and Final Offer of CMS, absent agreement from AFSCME, until the Ilinois Labor Relations ‘Board issues a legally valid decision on the issue of whether an impasse exists between the parties; ©) That the Court require CMS to give AFSCME reasonable advance notice of changes to the terms and conditions of employment which are connected to the implementation of the Last Best and Final Offer; 4) That the Court order CMS 1o provide information to AFSCME regarding the costs and benefits of the alternative insurance plans it secks to implement as part of its Last Best and Final Offer; ¢) That the Court enjoin future violations of the Tolling Agreement and Declaration;) That the Court award Plaintiff AFSCME the damages that it and its members have suffered from the violation of the Tolling Agreement and Declaration; 2) That the Court order the extension of the Tolling Agreement for a period comparable to the time CMS has been in violation of it h) That the Court award the costs and reasonable attomeys fees incurred by Plaintiff; and 1h) That the Court award any other relief it deems equitable and just. Respectfully submitted, Stephen A. Yokich November 30, 2016 Attomeys for Plaintifiis AFSCME Couneil 31 DOWD BLOCH BENNETT, CERVONE, AUERBACH & YOKICH 8 South Michigan, 19" Floor Chicago, Ilinois 60603 (312) 372-1361 (312) 372-6599 (fax)