Pittsburgh, PA – The Port Authority Board of Directors today took definitive action to solve the Authority’s ongoing contract negotiations with ATU Local 85 by voting to unilaterally impose the Authority’s final best offer, a step that is allowed by law when impasse has been reached in negotiations.
“It became painfully clear to Port Authority management earlier this week that the prospect of reaching a negotiated settlement with the leadership of ATU Local 85 was hopeless,” said Port Authority CEO Steve Bland. “The negotiating process reached absolute impasse and Port Authority sees no other alternative at this time.”
Discussions leading up to contract negotiations between Port Authority negotiators and ATU Local 85 leadership began in September 2007—nearly one year prior to the July 1, 2008 contract expiration date. Port Authority’s primary goal in contract negotiations was to rein in unsustainable and excessive healthcare and post-retirement benefits costs by asking the ATU leadership to accept a fair contract with wage and benefits concessions comparable to those in place for non-union, management and Police Association employees. While Port Authority was committed to working with the ATU Local 85 leadership to craft a contract that is not only fair to transit workers but also to taxpayers and transit riders, ATU negotiators offered no contract concessions and continued to delay the progress toward a solution.
Upon the contract expiration date (July 1, 2008), both parties declared an impasse in negotiations and requested that the Pennsylvania Labor Relations Board (PLRB) appoint a fact-finder. The PLRB appointed former law professor and attorney Jane Rigler as fact-finder on July 15th, who issued her Fact-Finder’s Report on August 28th. On September 12, 2008, the Port Authority Board unanimously accepted the fact-finder’s report, citing that it would amount to the single most significant restructuring of the Port Authority’s labor costs in its history, while maintaining competitive wages and benefits for employees.
Although ATU Local 85 leadership had originally scheduled a vote on the fact-finder’s report for early September, they ultimately decided to wait until after the Authority Board voted on the report before voting to reject the fact-finder’s report later that day. This rejection by union leadership sent negotiations back to square one and all previous proposals and the fact-finder’s report were thrown out.
“Subsequent negotiations have been completely unproductive,” said Mr. Bland. “ATU Local 85 leadership continues to ignore the needs of transit riders, and the taxpayers of Allegheny County.”
For example: ATU leadership proposed to increase healthcare contributions to 3% of base wages during the term of a five-year contact in exchange for a 20% increase in pay and the reinstatement of annual COLA compensation that was eliminated on June 30, 2005.
Taxpayers, transit riders, and Port Authority management and non-represented employees have all done their part to preserve affordable, accessible public transit in Allegheny County. Port Authority riders endured a 15 percent service reduction in June 2007 and a 25 cent fare increase on January 1, 2008. Taxpayers are now paying drink and car rental taxes in support of public transportation. On July 1, 2007 several pension, healthcare and post-retirement benefits were implemented for non-represented employees and members of the Port Authority, including:
- Eliminated post-retirement healthcare for employees retiring after June 30, 2007
- Eliminated a $500 monthly pension supplement
- Increased employees’ healthcare contributions to 2 percent of annual salary in Fiscal Year 2008 and 3 percent in FY 2009
- Implemented a one year wage freeze
Primary provisions of the new ATU Local 85 contract include:
- Three percent wage increases effective January 1, 2009; January 1, 2010; and January 1, 2011.
- Continuation of excellent healthcare package with employees contributing 7 ½ percent of the premium cost effective January 1, 2009, and 10 percent of premium effective January 1, 2010.
- Post-retirement healthcare package that, in order to receive the benefit, encourages employees to work longer to a higher age and requires a minimal contribution toward the cost.
- Elimination of post-retirement healthcare completely for ATU employees hired on or after December 1, 2008.
- Increased ATU employee pension contributions from 4 ½ percent to 5 ½ percent effective January 1, 2009 and 6 ½ percent effective January 1, 2010.
- Elimination of daily overtime for work in excess of eight hours in a work day. Overtime is based solely on hours actually worked in excess of 40 hours in a work week.
- Elimination of the previous contract provision that allows employees to show up late for work 13 times before receiving even a written warning.
- Expansion of Port Authority’s current ability to subcontract, without limitation, services such as custodial work, landscaping/grass cutting, snow removal, bus and rail vehicle cleaning, offboard fare collection, parts room functions and other functions or services that can be provided at a reduced cost for the benefit of taxpayers and riders.
“Unilateral implementation of our final best offer is, in my view, a radical step,” said Mr. Bland. “But I believe it to be our only viable alternative at this time. We are truly at impasse with the leadership of ATU Local 85, and I have absolutely no hope of us reaching a negotiated agreement, as Local 85 leadership continues to ignore the needs of our riders, and the taxpayers of Allegheny County.”