"The lawsuit charges the governor (Chris Gregoire), her budget director, Victor Moore, and the state with breach of contract and committing an unfair labor practice for bad-faith bargaining," the union said in a news release announcing the lawsuit. It was filed today.

UPDATE: Don't be surprised to see the Service Employees International Union join the Federation by filing its own lawsuit on behalf of its 30,000 home-care workers.

Here is the story I filed for publication in Wednesday's paper. Links to other documents and the union's news release and lawsuit are below.

Here is a copy of the lawsuit.

Look at my earlier posting. It has a copy of the letter Moore sent to Gregoire, along with all 33 contracts and the amounts of money that had been agreed upon. And finally, there is a statement from Moore.

Washington’s largest state-worker union sued Gov. Chris Gregoire and her budget director on Tuesday, accusing them of breach of contract, and an unfair labor practice for bad-faith bargaining by not including pay raises and benefits in her budget proposal.

The Federation of State Employees, which represents about 40,000 of an estimated 110,000 state agency and college workers, is asking a Thurston County judge to force the governor to submit a request for at least $216 million to the Legislature. That’s how much it would cost to give most of its members 2 percent pay raises in each of the next two years and to pay higher costs for fringe benefits, largely medical coverage.

[More:]

Those were the terms of contracts agreed to by union negotiators and governor this past summer. But when the governor last week unveiled the budget proposal she is sending to the Legislature, it did not include money for pay raises or benefits.
Gregoire invoked a provision in the 2002 collective bargaining law that allows the governor not to request funding for employee contracts if they are not financially feasible.
Victor Moore, her budget director, made such a finding Dec. 17, the day before Gregoire unveiled her 2009-11 budget proposal.
“The state has a responsibility to care for the poor, infirm and most vulnerable of its citizens,” Moore wrote in a letter to the governor. “It also must preserve the public peace, health and safety of the state.
“Given the projected deficit of $5.7 billion, funding the increases for compensation and fringe benefits provisions contained in the collective bargaining agreements and arbitration awards at the expense of other vital governmental services is not feasible financially for the state,” he concluded.
The federation lawsuit also seeks to invalidated the provision that allowed the governor to say “we can’t afford it.”
By invoking that provision, the governor was able to freeze pay and benefits worth a total of $453 million for 33 different employee groups, including the federation, higher education employees, and quasi-state workers such as home-care, day-care and adult family home workers who also negotiated pay-raise contracts with the governor’s office. In all, about 150,000 workers are affected.
Gregoire’s two-year $72 billion budget proposal also would freeze pay for about 100,000 public school and community college workers, saving an additional $390 million.
The Service Employees International Union 775NW claims the governor is breaking the law by not including a 47-cent hourly wage increase for its 30,000 members because its contact was approved by an arbitrator. That contract would cost $87 million.
Moore conceded the Legislature will have to change to law for the state to forego pay raises to those home-care workers, as well as other contracts that were approved by an arbitrator.
After Gregoire unveiled her budget, federation director Greg Devereux said the governor was obliged to go back to the bargaining table and resume negotiations with the union. He said his members would lobby the Legislature to give them the raises that were agreed to.
The union says Gregoire and Moore cross them up. All five federation contracts were ratified by members and submitted to Gregoire’s budget office by the Oct. 1 deadline set in law.
“We believe they did certify, either expressly or implicitly, by agreeing to the contract,” Devereux said Thursday. “Then, they have to move them forward and the Legislature has to decided what to do with them. That’s the reason we filed this lawsuit.”
State worker unions gained to right to bargain for wages in 2002 when the Legislature finally passed a bill that had been in the works for nearly 20 years. That law give the governor the authority to negotiate with unions. The Legislature cannot alter the financial provisions of the contract, but must accept them as negotiated by the governor or reject them.
If lawmakers reject them, the unions and governor must renegotiate financial terms.
Devereux said both sides knew the economy was headed into the tank. That’s why the union agreed to such low pay raises, he said.

Here is the Federation's news release:

Largest state employees union sues governor over negotiated pay raises

The Washington Federation of State Employees/AFSCME today sued Gov. Chris Gregoire for not including a funding request in her budget request for the pay raises negotiated between the union and her office.

The lawsuit charges the governor, her budget director, Victor Moore, and the state with breach of contract and committing an unfair labor practice for bad-faith bargaining.

The lawsuit asks Thurston County Superior Court to compel the governor to submit a request to the Legislature to fund the pay raises and other economic parts of the five contracts negotiated by the Federation. The pacts cover 30,000 General Government workers and 10,000 employees at 12 community colleges and all four-year universities and The Evergreen State College.

The Legislature would still have the final say about funding the economic parts of the contract or rejecting them. Rejection sends the contracts back to the bargaining table.

The governor in her Dec. 18 budget roll out invoked a clause in the 2002 collective bargaining law and omitted funding for the negotiated pay raises and other economics. She said her Office of Financial Management had not certified the contracts as financially feasible.

All of the Federation contracts were ratified by members and submitted to OFM by the Oct. 1 deadline set in law.

“Both parties agreed to the terms of that agreement, with the express or implied understanding that by this agreement, the director of OFM was committing to certify that the contractual commitments were financially feasible for the state*,” the lawsuit says.

“By the late summer of 2008, the defendants were well aware of and in fact had discussions with WFSE representatives about the downturn in the economy and the worsening economic conditions. These were reasons the financial aspects of the 2009-2011 (contracts)*were the lowest ever negotiated by the parties.”

Rep. Brendan Williams, D-Olympia, joined the lawsuit to challenge the idea that the financial feasibility clause in the 2002 law prohibits the 2009 Legislature from approving legislation funding the Federation’s contracts. “One Legislature (the 2002 Legislature) cannot enact a statute that prevents a future Legislature (the 2009 Legislature) from exercising its law-making power,” the lawsuit says.

And here is Victor Moore's official statement:

The law requires that the collective bargaining agreements be submitted to me as OFM director by October 1 and that I then certify that the provisions are feasible financially for the state. All of the contracts were concluded prior to the global financial market crisis in October and the November revenue forecast reducing state income by $1.9 billion. Given the resulting $5.7 billion shortfall for 2009-11, I determined that the compensation and fringe benefit provisions in the collective bargaining agreements were not feasible financially for the state.

We are looking at the suit filed by the Federation and will be working with the Attorney General’s office on our response.