Costa Mesa settles lawsuit over outsourcing with employees union

A costly four-year lawsuit between Costa Mesa leadership and its public employees union, stemming from the City Council’s effort to outsource municipal services, has ended in a settlement.

The council voted 3 to 1 in a closed session Tuesday to accept terms of the settlement, which was resulted negotiations between the Orange County Employees Assn., Mayor Pro Tem Jim Righeimer and Councilwoman Katrina Foley.

Councilman Gary Monahan voted against the agreement. Foley was absent for the vote.

“This was an emotional battle,” Righeimer said. “We’ve had a lot of issues between the council and general employees. It’s absolutely time to move on.”

The settlement allows Costa Mesa to privatize parks and maintenance services in 2017, but prevents the city from outsourcing other services for four years, which Righeimer called a “cooling-off period.”

The city also agreed to reimburse the union for $375,000 in legal fees and boost employees’ pay by 4%, effective July 1, 2015.

Calls to Jennifer Muir, general manager of the Orange County Employees Assn., were not immediately returned.

The battle between the city and its workers began in March 2011 when Costa Mesa leadership issued pink slips to more than 200 employees in an attempt to privatize certain municipal services as a cost-saving measure. The council majority at the time said its plan to target 18 city services for potential outsourcing would reduce unsustainable long-term employee expenditures, including pensions.

In response, the Costa Mesa City Employees Assn., affiliated with the OCEA, sued the city. Shortly after, a Superior Court judge issued a court order blocking the city from outsourcing some of its services.

The council rescinded the remaining pink slips in December 2012 and city officials asked the union to drop its lawsuit. The union refused, contending that outsourcing was still on the table even if the layoff notices were not.

A judge dissolved the injunction blocking privatization less than a year later, which opened the door for the city to outsource a limited number of services, including its 32-bed jail and street sweeping. Both services have been privatized in the past two years.

Righeimer said no employees have lost their jobs in the outsourcing effort. City workers whose jobs have been privatized have been transferred to another department with the same pay and benefits.

Foley acknowledged the settlement as a “huge step” toward reducing the city’s high legal costs. Costa Mesa has spent about $1.8 million on the four-year lawsuit.

“We’re trying to make right what is wrong,” she said of the agreement. “I’m proud to say the case is resolved.”