That would almost certainly result in the one thing that has been avoided in the current drawn-out negotiation: angry public action by MBTA employees, possibly including a strike.
Sticking points
The state will not know the outcome of the arbitration process until after it has already finalized the 2009 fiscal-year budget, making it virtually impossible for legislators to guess how much money the agency will need. And since the final terms of the contract may be retroactive to mid 2006, the MBTA might be facing a one-time cost (in make-up pay) of tens of millions of dollars.
One big piece of the deal has already been settled. The union and the MBTA reached an agreement on the pension plan this past November. In plain terms, the union won that battle. The MBTA wanted to raise the retirement eligibility from 23 years on the job to 25, wanted to impose controls over disability pensions, and wanted to reduce the benefit-formula percentage. None made it into the final deal.
But the arbitrator now must decide on other key issues. Although the two sides’ final positions are not public, sources tell the Phoenix that three big differences remain:
• WAGES After accepting small (or no) wage increases in recent contracts, the union expects at least a three-percent raise in this one. That would come to roughly $10 million a year. But the union is also asking for the raise to be retroactive to the start of this contract period, July 2006 — that would require an additional $20 million in make-up pay. The MBTA, citing its dire financial position, is offering a smaller raise, beginning only when the contract is signed, according to sources.
• HEALTH-CARE-UTILIZATION COSTS Current employees contribute 15 percent of the out-of-pocket costs for health care, with the agency picking up 85 percent. The MBTA wants to shift that breakdown dramatically, say sources, while the union wants to maintain the status quo.
• WORKPLACE ISSUES Many of the remaining items of disagreement — vacations, scheduling, assignments, and so forth — don’t carry clear price tags, but still impact the bottom line. For instance, the MBTA is trying to cut down on absenteeism, which drives up the use of expensive overtime shifts. (The agency has estimated a savings of $2.5 million a year if it can seriously reduce absenteeism, which has averaged more than 15 missed days per employee per year.) Management believes that the more flexibility they have over scheduling and assignments, the less they will spend on overtime. The union, which characterizes these as “quality-of-life” issues, wants to restrict the agency from assigning workers far from their homes, or on schedules disruptive to their personal lives.
Both sides have brought their final positions to the arbitrator; they will submit briefs next month, and a decision could come in June.
Negotiate, or legislate?
Complicating that next round of negotiations (and nearly exploding the current talks), the state government has recently expressed its determination to introduce new legislation that will impose major changes to MBTA employees’ pensions and health benefits.
The movement began this past September, when the state’s Transportation Finance Commission issued a report, along with recommendations, meant as a blueprint for the long-term planning of the MBTA, the Turnpike Authority, and the Highway Department.
