No, the contract would have increased the FA costs by $40 million per year, not by $40 million over five years.
No, the contract would have increased the FA costs by $40 million per year, not by $40 million over five years.
You're wrong, too.
It's a $40 million contract expense for the company, for the f/a group over the life of the contract. Translating to approx. 8Million per year, equates to approx $1455.00 per f/a per year.
Over 5 years equates to Approx $7,275.00 per f/a.
However, if you take into account medical premiums and co-pays and deductables... some f/as have coverage for just themselves, or for a depedent, or spouse, or for a family...this could be huge and can't be calculated in the "whole". F
or some f/as who don't use health care over 5 years, they have around 7,000 over the 5 years. If you take into account f/as who utilize health care often, and their families, this increase over the next 5 years is miniscule.
One long-term illness any time over this 5-year period, could exhaust employee/employer health care, and it would fall under COBRA...with the employee bearing the full cost. Ther are no protections in the contract for this event. The population is getting older, and therefore the probability increases that this could happen.
In previous contracts, f/as had protection against this, so there contracts had more value.
Today, those protections are gone, and the f/as is at risk not only to lose any increase benefit in this contract, but to continue to slide backwards.