MOU Fiscal Analysis: Bargaining Unit 8
(Firefighters)

On August 6, 2024, the administration submitted to our office a proposed memorandum of understanding (MOU) between the state and Bargaining Unit 8 (Firefighters). This analysis of the proposed agreement fulfills our statutory requirement under Section 19829.5 of the Government Code. Unit 8’s members are represented by the California Department of Forestry and Fire Protection (CalFire) Firefighters, CalFire Local 2881 (Local 2881). The administration has posted the agreement and a summary of the agreement and the administration’s estimated fiscal effects of the agreement on the California Department of Human Resources’ (CalHR’s ) website. Our State Workforce webpages include background information on the collective bargaining process, a description of this and other bargaining units, and our analyses of agreements proposed in the past.

Background

66-Hour Duty Week

Firefighters Compensated Differently Than Most Employees. Firefighters typically work—on average—four 72-hour workweeks in a 28-consecutive-day cycle. Employees on a 72-hour duty week receive overtime for all hours worked in excess of 212 hours during the 28-consecutive-day period. This compensation structure results in 19 hours in a typical work week being paid at 1.5 times an employee’s hourly rate for scheduled overtime, referred to as Extended Duty Week Compensation (EDWC). This means that employees work 76 hours of scheduled overtime every four workweeks. For any time worked in excess of 72 hours in a workweek, employees receive additional pay for unplanned overtime, which is also paid at 1.5 times an employee’s hourly rate.

Current MOU Set Stage to Reduce Duty Week to 66 Hours. Under the current ratified agreement, the state and Local 2881 agreed to reduce the duty week from 72 hours to 66 hours—a 24-hour reduction per pay period—subject to appropriation in the 2024-25 budget. The agreement specifies that the reduction to 66 hours goes into effect November 1, 2024. The agreement established a Joint Labor Management Committee (JLMC) to “determine the changes needed to implement the reduction.”

Enacted 2024-25 Budget Includes Funds to Reduce Duty Week. The 2024-25 Governor’s budget included $199 million ($197 million General Fund) and 338 positions in 2024-25 to begin implementing a shift to a 66-hour duty week as contemplated in the Unit 8 MOU. The budget proposal assumed that the costs would increase in the coming years, rising to $770 million ($756 million General Fund) on an annual basis and 2,457 permanent positions by 2028-29. For reference, as of December 2023, there were 4,724 authorized Unit 8 positions. Our analysis of the proposal can be found here. The Legislature approved the Governor’s proposal and incorporated the appropriation in the final budget package.

Duty Week Change Aims to Address Concerns About Firefighter Welfare. The state has experienced some of the most severe wildfire seasons in its history in recent years. These wildfires have placed significant strains on the state’s firefighters, many of whom have been asked to work for extended periods with few breaks. These long periods of work have been difficult for firefighters as well as for their families. By switching from a 72-hour duty week to a 66-hour duty week, the typical schedule for a firefighter would include roughly one fewer 24-hour shift per month than is currently the case. This, in turn, could provide some additional time off for firefighters, thus helping to address concerns about fatigue that have resulted from these recent wildfire seasons.

Major Provisions of Proposed MOU

Term. The proposed agreement would be in effect from July 1, 2024 through June 30, 2026.

Provisions Related to Reduction of Duty Week to 66 Hours

Reduction of Duty Week for Most Firefighters. While the Legislature approved the reduction of the 66-hour duty week, many operational details needed to be bargained in order for CalFire to implement the change. The proposed agreement would make necessary changes in the Unit 8 MOU to implement the reduction of the duty week to 66 hours. Effective the first pay period following ratification of the agreement, or November 1, 2024, whichever is later, the proposed agreement specifies that most full-time employees would be scheduled to work an average of 66 hours per week. This provision under the agreement would apply to all state employees represented by Unit 8 except employees who work in the classification of Battalion Chief or in a “specialty class.” (Specialty classes include Forestry Assistant I and II; Forestry Technician; Forestry Aide; Aviation Officer I, II, and III [Flight Operations]; Aviation Officer I, II, and II [Maintenance]; Fire Prevention Specialist I and II; and Forestry Logistics Officer I.) The proposed agreement maintains the requirement established under the existing MOU that affected employees receive overtime pay for hours worked in excess of 212 hours during a 28-consecutive-day work period. As a result, the agreement reduces the number of hours of EDWC from 19 hours per duty week to 13 hours per duty week.

Changes in Shift Patterns. The proposed agreement would make a number of changes to the seven shift patterns that delineate when specific types of firefighters are on duty versus standby over the course of the 28-day work period in order to maintain the average 66 hours per duty week.

Staffing Rotation Models. As we referenced in our March 2024 analysis, CalFire intends to adjust its staffing rotation to a platoon model where firefighters rotate on and off duty as a group rather than individually. The proposed agreement specifies that, notwithstanding the implementation of the 66-hour duty week for compensation purposes, upon ratification or on November 25, 2024, whichever date is later, Unit 8 members assigned to Shift Pattern 1 would be placed in either a “Modified Kelly” (also known as a 48/96 work schedule where employees work two consecutive 24-hour shifts on duty followed by four consecutive off days) or a “Rotational Platoon” schedule (also known as a 24/48 schedule where employees work one 24-hour shift on duty that is followed by 48 hours off). Each unit chief would determine which schedule pattern to adopt. Under the agreement, no later than September 10, 2024, the parties would meet and confer over the schedules identified by all units. The proposed agreement specifies that the union would waive mediation in the event of an impasse and that CalFire would be able to implement the schedule models 20 days after meet and confer.

JLMC Will Continue. The proposed agreement specifies that the JLMC created by the current MOU would continue to meet, as needed, to support implementation of the reduction of the 66-hour duty week in 2024-25. While the proposed MOU is intended to address any operational issues to implement the 66-hour duty week, the JLMC would remain to address any issues that arise during implementation.

Provisions Related to Pay

2024-25 Special Salary Adjustment (SSA) to Most of Unit 8. The reduction of the duty week to 66 hours reduces the number of hours firefighters are paid for scheduled overtime (EDWC) by 6 hours. At the same time that the 66-hour duty week would be established under the proposed agreement (the first day of the pay period following ratification or November 1, 2024, whichever is later), the proposed agreement also would provide an SSA to employees by the equivalent of 6 hours of EDWC. The intention of this provision is to reduce the duty week hours without reducing employee take-home pay. We note that, although the agreement would hold employees’ take-home pay harmless, because of how salary-driven benefits and other factors are calculated with payroll, this provision would result in a net increase in ongoing state costs of $14 million by the end of the agreement. This SSA does not apply to specialty classes.

2024-25 SSA for Specialty Classes. Effective the first day of the pay period following ratification or November 1, 2024, whichever is later, the proposed agreement would provide specified specialty classifications an SSA of 8.5 percent.

2025-26 General Salary Increase (GSI). Effective July 1, 2025, the proposed agreement would provide all state employees represented by Bargaining Unit 8 a 2.5 percent GSI. A GSI increases the base pay for all steps in each classification’s pay range.

2025-26 SSA to Fire Fighter I and Fire Lookout Classifications. Effective January 1, 2026, the proposed agreement would increase the minimum and maximum steps of the salary ranges for the Fire Fighter I and Fire Lookout Classifications by 4.25 percent. This results in all employees in these two classifications receiving a 4.25 percent SSA.

Peace Officer Recruitment and Retention Incentive Payments. Effective the first day of the pay period following ratification or November 1, 2024, whichever is later, (1) CalFire peace officers assigned to a designated peace officer position requiring the performance of peace officer duties would receive a pay differential equivalent to 5 percent of base salary and (2) all other CalFire peace officers who are appointed under Section 830.2(g) of the Penal Code and remain in good standing would receive a pay differential of 2.5 percent of base salary. These pay differentials would be considered compensation for purposes of calculating employees’ retirement benefits. In addition, effective the same date, CalFire peace officers who serve as a Field Training Officer (FTO) and are assigned a trainee would receive a weekly stipend of $350 for each week they are assigned an FTO. This pay differential would not affect employees’ pension benefits.

Pilot Qualification Incentive Payments. The proposed agreement would create a pilot qualification incentive effective the first day of the pay period following ratification of the agreement or November 1, 2024, whichever is later, for employees in specified classifications depending on their helicopter pilot qualifications and/or CalFire helicopter program responsibilities. Under the proposed agreement, the incentive payments are established as a percentage of base pay and range from 2.5 percent to 10 percent of pay. The agreement specifies that qualified employees may receive multiple incentive payments established by the agreement so long as the cumulative value of the incentive payments does not exceed 15 percent of pay. These payments are considered as compensation for purposes of calculating employees’ pension benefits.

Paramedic Daily Payment for Voluntary Overtime. Effective the pay period following ratification or November 1, 2024, whichever is later, the agreement would provide $50 to employees who are not in a designated Paramedic position but maintain an Emergency Medical Technician—Paramedic license in good standing for each day that they work voluntary overtime behind a designated Paramedic position vacancy. This payment would not affect employees’ pension benefits.

Fire Mission Pay. As we discuss in our March 2024 analysis, CalFire is changing its overall staffing model from one where the department progressively ramps up staffing levels between March and June for summer preparedness and ramps down staffing levels from October to December for winter preparedness to one where it maintains a base staffing level in January, February, and March and then a peak staffing level April through December with no transition period. Under the current MOU, specialty classifications receive fire mission pay when summer preparedness is in effect. The proposed agreement would provide fire mission pay to these employees during peak staffing periods, increasing the amount of time that eligible employees receive the pay.

Administration’s Fiscal Estimate

Implementation of 66-Hour Duty Week More Expensive Than Budget Assumes. The proposed agreement implements the 66-hour duty week that the Legislature approved as part of the 2024-25 budget package. The budget assumes that the costs in 2024-25 to implement the 66-hour duty week would total $199 million ($197 million General Fund). The administration estimates that the proposed agreement would increase the costs for the 66-hour duty week by an additional $13.5 million ($8.9 million General Fund) in 2024-25. Very roughly, we estimate that the provisions of the proposed agreement could increase the total annual costs to implement the 66-hour duty week by around $100 million more than the $770 million assumed in the budget by 2028-29 as the higher compensation levels included in the proposed agreement would be applied to the 2,457 new positions.

Effect of Higher Base Pay on Overtime. As is its normal practice, the administration does not include in its estimate the effects of higher base pay on overtime costs. Unplanned overtime costs for Unit 8 can vary significantly from year to year, depending on the severity of the fire season. In 2022-23, CalFire indicates that the total cumulative unplanned overtime earnings for Unit 8 members was $124 million. We would expect the higher base pay to increase CalFire annual unplanned overtime costs. There is significant uncertainty as to the specific amount these costs would increase, but likely would be at least millions of dollars each year.

LAO Comments

Term Length Consistent With Standing LAO Recommendation. The proposed agreement would be in effect for two years. This is consistent with our long-standing recommendation that the Legislature only approve MOUs with terms of one or two years.

Proposed MOU Implements Legislative Direction to Reduce Duty Week to 66 Hours. The Legislature approved the concept of reducing the firefighter duty week from 72 hours to 66 hours. The proposed agreement provides the framework from which CalFire operations will change to accommodate the reduced duty week. Some of these changes are related to pay—for example, adjusting employee base pay so that the shorter duty week does not result in lower take-home pay—while others are operational—for example, establishing schedules and shift patterns. When the Legislature considered the Governor’s initial proposal to reduce the duty week, the administration indicated that there would be a number of operational changes to implement the reduced duty week. The changes that are proposed in this agreement appear to be consistent with what the administration presented to the Legislature as part of the discussions around the CalFire 2024-25 budget.

Uncertainty of Full Fiscal Effect of 66-Hour Duty Week. There are a number of unknown factors that could affect the ultimate cost of the shorter duty week. We recommend the Legislature closely monitor the roll out of the 66-hour duty week. In particular, we recommend that the Legislature keep an eye on unplanned overtime utilization and the administration’s ability to fill new firefighter positions.

Role of JLMC Could Limit Legislative Oversight. Most, if not all, MOUs include at least one JLMC or similar management/labor workgroup. These workgroups can be tasked with discussing a wide array of topics and can be advisory or can be directly involved in developing policy for implementation. While there can be a benefit to management and labor collaborating on policy, the process can also hinder public and legislative oversight. The JLMC process generally is excluded from public disclosure under the California Public Records Act. The administration considers the JLMC process as part of the collective bargaining process, which it considers confidential. Consequently, the administration may propose or implement policy changes that are formed through the JLMC process and be unable to offer a justification beyond that the policy change is “the product of the JLMC process.” The proposed agreement would retain the JLMC created to recommend policies to implement the 66-hour duty week. We recommend that the Legislature not assume that the administration would provide any justification for policies that are adopted as a result of this JLMC.

Unit 8 Compensation

Compensation Study Required by Law. When establishing state firefighter compensation, Section 19827.3 of the Government Code requires CalHR to “take into consideration the salary and benefits of other jurisdictions employing 75 or more full-time firefighters who work in California.” The MOU establishes additional requirements for CalHR to conduct a compensation survey. The most recent compensation study compares four state firefighter classifications (Firefighter II, Fire Apparatus Engineers, Fire Captain [Range A], and Battalion Chief). The study compares employer costs for salaries, cash benefits, health and retirement benefits, EDWC, and the value of accrued leave. The study compares the state with 20 fire departments across California.

State Firefighter Compensation Found to Lag Local Fire Department Compensation. The 2023 compensation survey found that state compensation for firefighters lags compensation provided to local fire department firefighters by between 11 percent to 29 percent, depending on the classification. The survey found that while both state and local firefighters work 24-hour shifts, state firefighters work more days of the year (156 days compared with 121 days for the local fire departments in the survey). The result is that state firefighters work more hours of scheduled overtime than local firefighters. Based solely on local government compensation levels and hours, the pay increases proposed in the agreement appear reasonable.

Compensation Survey Does Not Compare Federal Firefighters. About 3,800 U.S. Forest Service firefighters are employed in California as of July 2024. These federal firefighters defend federal lands from wildfire, a job very similar to CalFire’s responsibility to defend against wildfire. While Unit 8 compensation regularly is found to lag local government firefighter compensation, in the past, Unit 8 compensation has been significantly higher than federal firefighters. We do not know how Unit 8 compensation currently compares with federal firefighters. In order to reflect the labor market for wildfire firefighters in the state, the CalHR compensation study should compare Unit 8 compensation with federal firefighters. The pay increases provided by the proposed agreement might not align with more comparable federal firefighter pay.