South Dakota Department of Labor Recommends City’s Proposal in Police Labor Dispute

The South Dakota Department of Labor (SDDOL) issued its report today following a fact-finding hearing addressing the impasse in collective bargaining declared by the Fraternal Order of Police (FOP) in its labor negotiations with the City of Sioux Falls. The SDDOL has sided with the City.

James Marsh, Division Director of the SDDOL, said in his report released today that the Department of Labor recommended the City’s proposal that included a 1.5 percent cost-of-living adjustment in 2017 and 2018 for employees represented by the FOP. The report cited revised sales tax projections, no inflationary increase in property taxes for 2017, and maintaining the City’s 25 percent reserve fund.

With the release of this report, the administrative process has now concluded and the City of Sioux Falls will seek to implement the terms associated with its final and best offer that included cost-of-living adjustments of 1.5 percent in 2017 and 2018 for the approximately 220 Sioux Falls Police Department (SFPD) Sergeants and Officers represented by the FOP. The implemented contract would go into effect upon the approval of the Sioux Falls City Council.

Police Officers and Sergeants have the opportunity to receive raises in addition to the 1.5 percent cost-of-living adjustments as well. Under the terms of the contract, FOP members can also receive step increases. Police Officers progress through nine pay steps from the minimum to the maximum of the pay range. The value of a step increase for a Police Officer is between 4 and 5 percent. If a Police Officer is eligible for a step increase, his or her overall pay increase is the value of the cost-of-living adjustment (1.5 percent) plus the value of the pay step. That means if an officer receives a step increase, his or her total pay would increase between 5.5 and 6.5 percent annually. If not eligible for a step increase, his or her pay would increase by 1.5 percent.

Police Sergeants progress through three pay steps from the minimum to the maximum of the pay range. The value of a step increase for Police Sergeants is 3.5 percent. If a Police Sergeant is eligible for a step increase, his or her overall pay increase is 5 percent annually. If not eligible for a step increase, his or her pay would increase by 1.5 percent. Therefore, 1.5 percent represents an inflationary increase to the respective pay scale and does not represent the total eligible pay increases for FOP members under the terms of this labor contract.

The City of Sioux Falls and the FOP began collective bargaining on a new labor agreement on May 3, 2016. The previous three-year labor agreement expired on December 31, 2016. After seven collective bargaining sessions with the FOP, the City presented its final and best offer that included a cost-of-living adjustment of 1.5 percent for each year of the offer. On August 1, 2016, the FOP notified the City that the majority of their membership voted not to approve the labor agreement.

The City and FOP met on August 22, 2016, to discuss the FOP membership vote. The City offered to include a wage opener to reopen bargaining on wage increases for 2018 if audited 12-month rolling sales tax returns improved to 5.5 percent or greater by year-end 2016, but the FOP rejected the proposal.

On October 21, 2016, the FOP formally declared an impasse and requested mediation from the SDDOL. A conciliation conference led by an administrative law judge that included the City and FOP bargaining teams was held in Sioux Falls on December 21, 2016, yielding no results. The FOP subsequently requested a fact-finding hearing with the SDDOL. That hearing was held in Pierre on January 12, 2017, with James Marsh, Division Director of the SDDOL, and members of the City and FOP bargaining teams. The hearing resulted in Marsh’s report that was released today.

The City of Sioux Falls believes our offer is fair and competitive. Comparatively, South Dakota Governor Dennis Daugaard proposed a 1 percent cost-of-living increase for all state workers due to a nearly $20 million shortfall in state sales tax collections. Minnehaha County Sheriff’s employees will receive a 2 percent cost-of-living increase in 2017 and 1 percent in 2018.

The 2017 starting pay scale for SFPD Officers in the implemented contract is $23.88 per hour ($49,670 per year) and top scale is $33.89 per hour ($70,491 per year). The starting pay for Police Sergeants in 2017 is $36.43 per hour ($75,774 per year) and top scale is $39.06 per hour ($81,244 per year).