African Americans could benefit from the Philadelphia Housing Authority’s recent decision to end its practice of hiring provisional workers.
While Interim Director Kelvin Jeremiah made it clear that the decision to eliminate the practice was purely financial, it could pry open the city’s trade unions to Black workers — largely because Jeremiah plans to enforce the agency’s requirement that employees live in the city.
“I am mindful of the fact that by having the requirement that we have … and that by so doing we could have more African Americans, Blacks and browns, minorities getting union positions in the city. I think that’s an added benefit,” said Jeremiah.
Despite the possibility of pressure from the city’s politically influential trade unions, Jeremiah said he would rigorously enforce the residency requirement.
“The requirement for residency is not one I’m willing to waive,” he said, adding that provisional workers who choose to make the change to permanent PHA employees would be given six months to move into the city.
“If they, for whatever reason, choose not to, that means they will not be a PHA employee,” he said.
Earlier this week, Jeremiah told the Tribune that he planned to lay off 335 provisional workers. They are union workers initially hired on a temporary basis, some of whom, under former director Carle Greene, stayed as long as a decade. They will all be laid off effective Sept. 1. \
According to Jeremiah, 225 may then be rehired as permanent PHA employees, provided they meet PHA standards — which includes the residency requirement. Though he lacked hard numbers, Jeremiah estimated that roughly 50 percent of them lived outside the city limits.
Whether the move will actually open union ranks to African Americans remains to be seen.
Provisional employees who are laid off on Sept. 1 will have the opportunity to return to their jobs as in-house employees at PHA.
“So, it depends on what the unions want to do with replacing those guys,” he said. “We want to work with them. Our job is not to destroy the unions.”
Jeremiah said most of the city’s trade unions have been open to the change, realizing that PHA could not continue to pay the roughly $10 million extra in benefit costs caused by the arrangement.
So far, Jeremiah said, the majority of the city’s trade unions have embraced the idea, with the exception of the carpenters’ union — the Metropolitan Regional Council of Carpenters
of Philadelphia & Vicinity.
“They want to see if [I] will go ahead and lay off 335 employees,” he said. “I would bet on … me.”
Carpenters union business manager Edward C. Coryell did not return several calls this week seeking comment. Sam Staten Jr., president of the Laborer’s Union, Local 332, could not be reached for comment either.
“With the other unions, I was amazed,” said Jeremiah. “I surprised by the willingness of the union leadership to cooperate. They understand the impact on the agency.
The plan, part of a larger reform agenda, has the support of the Department of Housing and Urban Development.
“We know that change doesn’t sit well with everyone,” said HUD spokesman Jerry Brown. “But, the things that we’ve seen have been fair thus far. There has to be changes made to the PHA, that’s why it’s under receivership, to right the ship.”
The move to eliminate provisional workers will allow the agency to cut its benefit costs, in most cases by as much as 49 percent.
As an example, Jeremiah pointed to the agreement with the carpenters’ union, where, between April 2011 and April 2012, 21 “in-house” carpenters cost PHA $1.3 million in wages and an additional $547,000 in benefits — a 42 percent wage to benefit ratio. For 91 provisional carpenters, the agency paid out a $6.1 million in wages and $5.4 million in benefits — a ratio of 89.2 percent. Those additional benefit costs were paid directly to the unions.
By converting those employees from provisional to in-house, PHA stands to save about $3 million annually.
In total, PHA has spent $28 million over the last year on provisional employees — $15 million in wages and $13 million in benefits. The total savings in converting them to in-house employees is expected to be around $10 million annually.
In the late 1990s, Greene apparently reached a deal with the city’s major trade unions that established the practice of using provisional employees to bolster PHA staff for short periods when extra help was needed.
“Greene had some arrangements with the various unions, to provide laborers … to come to PHA in an effort to augment PHA staff,” Jeremiah said. “The benefit was that we would have skilled laborers working at PHA.”
However, the concept was soon perverted. It remained in place under Greene’s successor Michael Kelly, who left the agency in June under the cloud of his own scandal.
Jeremiah said the move was just a part of a larger reform agenda he would be implementing over the next few months.
“PHA has had a culture of splurge, of excess,” he said. “I’m going to [cut] across the agency until I’m confident that we’re not wasteful in the resources that we have.”