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New MTA Chair Faces First Test in Labor Relations

participatory budgeting
Transit Worker Union members get their message out in past years.

The contract negotiations between the Metropolitan Transportation Authority and Transport Workers Union Local 100 TWU, which began last monthseem poised to widen the rift in the already strained relationship between the agency and the union representing some 34,000 bus and subway workers.

Certainly the talks – along with the agency's budget crunch – represent two huge and interrelated challenges for newly named MTA executive director Joseph Lhota. Lhota's efforts to cope with the agency's budget crunch rely to a great extent on how much he can or cannot get from the union. The authority wants workers, whose contract expires Jan. 15, to agree to a three-year pay cut and reportedly also is seeking to cut employees health care costs. For now—at least publicly – the union has rejected both ideas.

Much has changed since the union struck, shutting down the transit system for three days right before Christmas in 2005. The agency's financial system has gotten worse and two new people will face each other across the negotiating table.

Pay and Benefits

As they began their negotiations in November, the union and the transportation authority confronted two familiar issues: health care benefits and wages.

Health care will be a key issue during contract negotiations, according to Jim Gannon, head of communications for the TWU. The union plans to oppose any proposed increase in out-of-pocket healthcare payments and or the termination of members' healthcare plans.

The fight over healthcare is not new. In September, the TWU filed a grievance with an arbitrator over the MTA cutting healthcare for members, a move the union says violated its previous contract. The TWU alleged that the MTA has saved $40 million by finding new healthcare providers that require workers to pay more for the plan, while reducing coverage.

"There are issues with prescriptions, issues with hospital stays. There is an across the board effort by the MTA to nickel and dime transit workers to death," said Samuelsen.

The issues with healthcare come as the two sides ended a bitter battle over wage hikes. During the last contract negotiations, the transit authority refused to pay wage increases as a way to save $300 million in operating costs. The issue went to an arbitration panel, which awarded the workers a hike of about 11.5 percent over the three years of the contract. The MTA at the time didn't include any wage increases in its budget It then went to court to try to block the increase, but the judge found for the workers and the pay raise went through.

At the time, the MTA said flatly that it could not afford the pay hikes, which it said could cost the cash-strapped agency $200 million a year by this year. In a statement issued after a court upheld the raise, the agency said, " “The ruling will have severe financial impacts on the M.T.A. budget, coming on the heels of a state budget cut and reduction in payroll tax proceeds.”

This time around the MTA has said it will agree to pay hikes only if the union makes concession to offset the additional cost. "They can have an increase in their wages as long as we get work rule changes or other contributions to reduce the cost in the budget to zero," Robert Foran, the authority's chief financial officer, told Crain's.

Samuelsen, though has dismissed the idea of the proposed three-year wage freeze -- even though other public employee union have agreed to forego wage hikes. "NYC Transit workers are not agreeing to the wage freezes that other unions have. Neither transit workers, nor any other public sector workers caused the economic downturn," Samuelsen said in an online letters to workers. "NY state needs to look toward the investment bankers and Wall Street swindlers who caused this crisis to balance the budget, rather than to the hard working families of the Transport Workers Union."

The TWU also criticized the MTA for once again not calculating pay raises in its 2012 preliminary budget. The financial plan released by the agency in July calls for a wage freeze and for fare and toll hikes in 2015.

A New Beginning?

Lhota's appointment marks the end of a bitter relationship between the union and his predecessor, Jay Walder. According to Gannon, Walder's decision to try to dictate day-to-day operations strained the relationship between rank and file workers and leadership.

"The relationship with the MTA was terrible when Walder was there. His attitude was my way or no way. He had an agenda that we viewed as an anti-worker, anti-union agenda and an anti passenger agenda," said Gannon. "His whole thing was technology and the capital program. ... He didn't believe that the system needed people and he went after the station agents and the cleaners."

Throughout his tenure, Walder and the TWU fought over healthcare contributions and pay raises as well as the layoffs of rank-and [file transit workers. According to Gannon, 927 TWU members were laid off during Walder's tenure, the majority of them were cleaners or station agents.

When Walder announced his resignation after two years, Samuelsen released a letter criticizing his leadership. "Transit workers won't miss Jay Walder and quite frankly will be glad to see him go," it said.

Almost as soon as Gov, Andrew Cuomo named Lhota to the post, John Samuelsen, president of TWU Local 100 sent a message out to Lhota, imploring him not to worsen the bitter labor relationship between the MTA and the union. In the message, Samuelsen harked back to 1999 contract negotiations where the Giuliani administration got a court order preventing union members from suggesting labor actions and saying the word "strike." Lhota served as a deputy mayor in the Giuliani administration.

"If Lhota wants to continue the policies of where Giuliani left off in 1999, then he's likely to have a problem with organized labor. If Lhota is looking to have a working relationship knowing that we are going to disagree on many issues, then that would be our choice, our preference,” said John Samuelsen of TWU Local 100.

Same Game, Different Players

Samuelsen, though, also has expressed optimism that labor-management relations will be better under Lhota than they were under Walder. Even before he took office in mid November, Lhota and Samuelsen met several times, according to Transportation Nation. And on his first day at the MTA, Lhota signed a letter with Samuelsen urging prosecutors to crack down on passengers who attack transit workers.

The letters reportedly was Lhota's idea. “For the workers to see that Lhota actually seems to care about them, that will go a long way,” Gannon told a reporter.

Lhota bolstered that impression when contract talks began Nov. 15 and he told the assembled union members that authority's employees were its "most valuable resource." The workers reportedly roared in response.

And at the end of the initial meeting, Samuelsen asked his members "to show respect for the bosses who are walking out of here right now."

As for the union, Gannon pointed out that Samuelsen's relationship with union members is different than that of former TWU Local 100 President Roger Toussaint. While praising Toussaint's leadership, Gannon says that Samuelsen is more in touch with the daily needs of the workers.

"John is far more of a blue-collar grass roots guy than Roger was. His contact with members is on a daily basis, he has tremendous one-on-one relationships with the members. He's more keenly interested in what the members needs are on a daily basis, their working conditions,” said Gannon.

To the relief of transit rider, Gannon said the TWU does not intend to initiate any action similar to the two-day strike in December of 2005. In the years since then, he said, the union has tried to improve its public image. "The TWU has been initiating publicity events to get its message out and to advocate for rider quality issues," he said. "I think we lost some ground after the strike in 2005, and ' tough building it back up, the confidence and the credibility, and strike is the last thing on [Samuelsen's] mind.”

Along with the contract talks, Gannon said, the TWU is focused on its online petition to urge the MTA to develop a rat eradication program, its early support for the Occupy Wall Street protests, and its advocacy for the continuation of the state's millionaires tax.

“The whole outreach through free media, the outreach through communities and supportive activities through other events and to show people that the transit workers are not the enemies. Were not money hungry greedy union thugs,” said Gannon.

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