Contract Crystal Ball?

To analyze any opponent one must see their moves and the possible alternatives that are made conceivable by such moves.  As we inch closer and closer to this contract fight, the anticipation of what strategies the MTA may employ in that fight seem to become clearer or they just may be a mirage, only time will tell the complete story. A recent development inside the MTA perhaps has tipped their hand to a potential strategy. In the last few days the MTA has released information that they are creating a special Retirement Section at 130 Livingston St. This Retirement Section is on par with other MTA sections such as sick, safety and timekeeping. If one has followed the MTA they should know that they do not do anything without a reason, especially during the run-up to contract negotiations, so the creation of such a section is noteworthy and curious. 

One thing the MTA bosses have spoken about time and again as a long-term expense is our pensions. For the longest of times, MTA bureaucrats have moaned and whined about the cost of our future pensions. It does not matter the price we pay as workers to realize those pensions, in the eyes of the MTA they are luxurious and extravagant. There seems to be a general consensus inside the MTA to deal with the pension situation.

Let’s examine what we know: Gov. Andrew Cuomo has repeatedly stated his desire for a new tier six pension plan for new employees. Right now we as TWU Local 100 members are in a 25/55 tier four pension. The tier 6 pensions would include a higher contribution rate for employees from 2% to as much as 6%, a longer road to top salary for these employees and a 30/62 service/age requirement. Over the term of the 30 years the MTA would make $100s of millions of dollars. It is an almost sure bet that Cuomo will try for a tier 6 for any new MTA employees. He wants to be known as the Governor who reformed public pensions. 

We also know that under the former Gov. David Patterson, some state employees were afforded the option of an Early Retirement Initiative (ERI), which was never offered to TWU Local 100 members, well at least not publicly offered. What many do not know is that around the time of the lay-offs Walder and the MTA did offer ERI to TWU Local 100, but later reneged on the deal. Under the ERI workers will receive one month of additional pension credit for each year of service up to a maximum of 36 months/3 years added credit. Essentially one could make more money on their pension, sooner. Without the fork-tongued Walder around to renege on deals, ERI becomes a possibility.  It is a vehicle to not only escort, if not push, senior workers out but also a way to downsize the workforce, without lay-offs and RIF lists.

We also know that our current pension contribution is 2%. As employees there was a time in the 1990’s where we were paying 5.3%, so a 2% pension is fairly light in our experience. It would be our guess that the MTA would attempt to get an increase in this area as well. Perhaps a jump of 1% to 3% for established workers is possible.

The MTAs’ goals for this contract fight are what they always are: to give as little as possible and get as much as they can. We also know the MTA has created a new Retirement Section. What we don’t know is the possible ramifications this brings to us as TWU Local 100 members going into what may be the worst climate for a contract in recent memory. 

Now here is the speculative part: With the establishment of this Retirement Section in the MTA that may be signaling the coalescing of some of the things we know, as stated above. Who is to say that the establishment of a tier six pensions coupled with the offer of the ERI for veteran employees, coupled with a pension contribution increase for existing employees won’t happen? If it did it would stand to be a moneymaker for the bosses. Whatever money the state/MTA would have to shell out for the ERI would be dwarfed by the future savings of the tier 6 pension.

The realization of MTA profit from any long term pension savings on an ERI, a new tier 6 or any pension contribution increase would start slowly but eventually save the MTA $100s and $100s of millions of dollars. And more importantly change the landscape of the MTA employee pensions forever.

By this move the MTA would be accomplishing attainable goals: riding itself of high-salaried, (with what the MTA views as an unfavorable pension plan), employees and replacing them with new employees with a higher contribution rate, longer employment term and lower salaries. It would be seen as almost an investment plan for them.

But most of this is sadly from an MTA point of view, now come the important questions: What do we get? In business economics, the short term expense, say a 3% wage raise over 3 years is temporary, while it is true that all raises eventually cost the employer more in terms of pensions, the real change they want is long-term pension reform.  If the MTA and Gov. Cuomo really want pension reform, they should have to pay dearly for it.

Nothing should be off the table for us. A solid, iron-clad no layoff clause would be a good place to start. Job security is never a bad thing. High wage increases over the life of the contract would be a must. Therefore lets make that much better medical, dental and vision coverage, more and better choices in providers. Expanded health coverage zones that reach into New Jersey and PA. Perhaps even a switch to TWU Local 100 control of the Health Benefit Trust. 

Better, stronger, safety language, more TWU safety department inspectors released. An overhaul of the discipline system would be a welcome idea as well; TWU Local 100 member to having real recourse in the event of petty management abuse and the ability to act on those abuses would be a real benefit. To be honest the list could go on and on. Wish lists often do that. But make no mistake if pension reform is Cuomo’ and the MTAs goal then they must pay dearly for it. To let them have easily would be a huge mistake.

To be sure, at best this article is speculative and clearly based on a reactive projection to the MTAs’ latest bureaucratic section, the Retirement Section, but we in TWU Local 100 must begin to learn to think outside the box and try to anticipate our employers’ actions. Preparation to all possibilities is impossible, but that doesn’t mean that preparations to some possibilities are wasted efforts. What the MTA will eventually come to the table with is as of yet unknown, but with the contract right around the corner we should know soon enough.