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Five years after being shut down by then-Gov. Pete Wilson, the State Bar of California faces another potentially devastating work stoppage — this time from within its own ranks. On Saturday, about 40 members of Local 535 of the Service Employees International Union — all wearing purple SEIU shirts — poured into State Bar headquarters in San Francisco, threatening to go on strike because of a growing impasse over a proposed three-year wage freeze and the Bar’s refusal to provide retiree health benefits. “Nobody wants to [strike],” union representative Barbara Field, a Los Angeles-based State Bar investigator, said minutes after talking to Bar governors. “But we certainly would consider all options.” Things are so bitter that a federal mediator has been called in and will meet with both sides today and Wednesday. If the 400 or so union employees — ranging from State Bar prosecutors to receptionists — go on strike, it would mark the first time since 1986 that Bar employees walked out over labor issues. State Bar executives, who saw the Bar limp along for nine months in 1997 and 1998 after Gov. Wilson vetoed the organization’s funding, said the Bar would survive again if union members walk. “The core group here watched 500 employees march out the door through no fault of their own [in 1997], and for nine months we ran [the Bar],” Robert Hawley, State Bar deputy executive director, said Saturday. “And we’d do it again.” The dispute centers on a proposed salary freeze on all cost-of-living and>step increases for three years and on the Bar’s refusal to grant its employees health benefits under the California Public Employees’ Retirement System, better known as CalPERS. Bar officials say tight economic times and current lawyer dues of only $390 are forcing a wage freeze, and they argue that going to CalPERS health benefits would put the organization in the position of facing an “unfunded liability” of about $20 million 20 years from now. Hawley said the reason the State Bar could face a $20 million liability in 2022 is the fact that CalPERS, unlike the Bar’s two current health-care providers, mandates health benefits for retirees. “You’ve got to take money out of your operating budget year after year to pay for these retirees,” Hawley said. “So that means in 20 years we have to have $20 million or our accountants will put us in red ink. “If you don’t have that $20 million, you’re going to look like Enron,” he added. “The Bar is going to pre-fund what’s necessary.” Employees from both the San Francisco and Los Angeles offices showed up at the Board of Governors meeting on Saturday as a show of force. “We wanted to give them an insider perspective on the process, and to be aware of our concerns,” said union representative Robin Haffner, a deputy trial counsel in the San Francisco office. “We do feel, and we want you to feel, that the staff is the most important part of your organization,” union spokeswoman Field told the governors minutes earlier. A good deal of acrimony was exhibited by both sides, with union members arguing that State Bar executives have provided them with no actuarial data to support their statement that the Bar could take a $20 million hit if it retains CalPERS for its employees. But Bar officials later pointed to a letter to union members that indicated that the accounting firm of William Mercer Inc. had estimated retiree health benefits to reach $16.4 million by 2022, and that the amount has since grown by $3.5 million. “We just wanted you to know we have provided this information repeatedly,” State Bar Executive Director Judy Johnson told Bar governors. “[Union members] don’t seem to want to hear it.” “The board,” Hawley said, “is bound by prudent economic standards.” The negotiations are being handled by Bar staffers, particularly Hawley, a former labor lawyer on the management side, but the final agreement must be approved by the Bar’s Board of Governors. Asked afterward if any middle ground could be reached, neither side could point to any, and have placed their hopes on mediation. “We are at a stalemate, and we are at the point where we are requiring the assistance of a federal mediator,” Haffner said. “From our point of view, it’s not encouraging.”

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