Crains New York - July 9, 2012 - (Page 13)

GREG DAVID Con Ed dispute sheds light on labor reality I n the good old days of economic prosperity, unions went on strike when employers were unwilling to agree to increase wages or improve benefits. In today’s era of economic difficulties, companies take the initiative when they try to reduce costs, especially when the wages and benefits they offer are out of line with the rest of the private sector. That’s what is at the heart of the dispute between Consoliand know that any settlement will involve concessions. Con Ed seems to have taken its dated Edison and its workers. Con Ed locked out its workers when no deal could be reached after the contract expired. Let’s start with the issues. Con Ed is one of the few remaining major companies to offer a classic defined-benefit pension plan rather than a 401(k). In such retirement plans, workers receive a pension for life, the company’s liabilities are unlimited and the costs rise as retirees live longer. Con Ed wants to move its benefits close to the retirement plans that virtually every other business offers. Then there are the tactics. In the new labor environment, unions are seeking to preserve their current contracts, not improve them. It is in their best interest to keep working under the current arrangements rather than strike and both lose pay The utility needs to get its costs in line in order to survive clue from last summer’s big labor confrontation between Verizon and its unions. Verizon workers walked out on Aug. 7 in what was the largest strike in the country in four years when the company demanded changes in pensions and health care benefits not unlike those being sought by Con Ed. The workers returned two weeks later when they realized the risk they had taken. And so far it has been a good decision. Eleven months later, there is still no contract,and Verizon hasn’t won a single concession. The Con Ed situation is particularly telling because of two unique factors. Con Ed remains a regulated utility, with its prices set by the Public Service Commission and based on its costs. So it does—and could continue to—pass along those pension costs to you and me. In addition, natural-gas prices have plunged so dramatically (because of hydrofracking, for all of you who oppose that drilling system) that customer bills are actually falling. Con Ed does not need to mollify angry consumers. So why lock out the workers and run the obvious risks of a major blackout that would cripple the company’s reputation and cost it hundreds of millions of dollars? The answer is that Con Ed knows its future is uncertain. Last week, a $32 billion merger made Charlotte, N.C.-based Duke Power the largest power company in the nation. Its chief executive noted there were 100 large utilities in the United States in 1992. Today, there are 53, he said, and consolidation will continue. To survive, Con Ed will have to get its costs in line. C O L L E C T I O N L I T I G AT I O N & J U D G M E N T E N F O R C E M E N T All types of debt collection matters and general commercial litigation, trials, and appeals. AGGRESSIVE - RESOURCEFUL - EXPERIENCED - RESPONSIVE 10 0 L A FAY E T T E S T R E E T - S U I T E 6 01 | N E W YO R K , N Y 10 013 212- 6 0 8 - 5 3 0 0 | W W W. D O R A Z I O - L A W.C O M MARK WAGAR E When the doc says, ‘You’re prediabetic’ ven though I’m within layup distance of Medicare, in my mind’s eye I’m still that 220pound, 6-foot-8, lean and mean basketball player I was back in 1971, when I played forward on Ohio State’s Big Ten championship team. A year and a half ago, that delusion was checked when results from my annual physical showed that while I might still be mean, I was certainly no longer lean. I was also prediabetic. During the eight years I’ve run Empire BlueCross BlueShield, employers have increasingly come to depend on us for programs aimed at improving the health of their employees, such that workplace productivity is maximized and health care costs lowered. So how did I feel about being diagnosed as prediabetic—a condition that is largely preventable? Let’s just say terribly uneasy, on both a personal and professional level. The city’s Department of Health tells us that diabetes is the most rapidly growing chronic disease of our time, affecting one in 12 New Yorkers. The number of New Yorkers with diabetes has more than doubled since 1994 and is likely to double again by 2050. Diabetes is the third-costliest physical health condition for employers. As a result, business and labor leaders should leverage programs offered by their insurer to educate and support their prediabetic and diabetic employees. Here are some examples of programs offered by Empire, but keep in mind that most insurers should have offerings of this type as well: Our newly launched PC2 initiative will broaden opportunities for members to have a primary-care physician coordinate their care and improve health outcomes. MyHealth Coach offers oneon-one help from a licensed, registered nurse, with tools and resources to help members manage their health condition. Healthy Lifestyles helps members create a well-being plan based on the results of a health assessment. This plan serves to strengthen connections between members and physicians, improving compliance with recommended medication regimens and screenings. A few months ago, I was vastly relieved to get a clean bill of health from my doctor. I am officially no longer prediabetic. What did I do right? I got myself a primary-care physician, who coordinates my healthcare. I lost 5% of my body weight by eating more fruits, vegetables and smaller portions of high-calorie foods and beverages. And I’m walking for at least 30 minutes a day, five days a week. So, am I still 220 pounds? No. Can I still slam-dunk? Maybe once. But, frankly, I do feel like I’ve made it back into the winner’s circle. Mark Wagar is president and chief executive of Empire BlueCross BlueShield, New York’s largest health benefits company. July 9, 2012 | Crain’s New York Business | 13 http://www.dorazio-law.com http://www.dorazio-law.com

Table of Contents for the Digital Edition of Crains New York - July 9, 2012

Crains New York - July 9, 2012
Contents
In the Markets
The Insider
Small Business
Business People
Executive Moves
Real Estate Deals
Opinion
Greg David
For the Record
Classifieds
From Around the City
New York, New York
Source Lunch
Out and About
Snaps

Crains New York - July 9, 2012