Healthcare contribution:
MTA wants the members to pay up to 10% of all healthcare contributions. The MTA in their proposal cites that right now employees currently pay 1.5% of wages based on 40 hours, which equates to an average of approximately 5.5% of total premium costs.
This is interesting on multiple fronts:
• First off we believe when the 1.5% health contribution was sold to us as part of the 2005 contract we were told by the Toussaint administration that it was for retiree benefits.
It seems the MTA begs to differ.
From what it looks like the MTA is now using our 1.5% healthcare contribution as a way to pay everyone’s healthcare costs. What did the original agreement say?
Effective upon payment of the first general wage increase provided in Sec. 2A of this Agreement all active employees will contribute 1.5% of their bi-weekly gross wages to offset the cost of retiree health benefits. In future years, the 1.5% contribution rate shall be increased by the extent to which the rate of increase in the cost of health benefits exceeds general wage increases. This contribution will be on a pretax basis.
(2005 MOU)
A little confusing no? The first part of this says clearly that the 1.5% will be for retiree benefits. The second part implies that the 1.5% “in future years” will be for healthcare benefits. The question is: does that mean everyone’s healthcare benefits? Or just those of retirees? If it is for all health benefits as the MTA in 2012 says then the members of this local were sold a false bill of goods in 2005. And if we remember correctly that 2005 contract was originally voted down by the members and then put up for an unprecedented re-vote on the grounds of misinformation from the “no” contingent vote. For those who have read Orwell’s 1984 that is classic double speak.
• Secondly, the MTA proposal for a 10% increase sounds very ambitious on the surface. But is it really? An increase from a 1.5% contribution to a 10% contribution would likely not pass scrutiny with an arbitration panel no matter what other Unions pay. But, if we are to believe the MTA’s own numbers that the 1.5% healthcare contribution is equal to 5.5% of premium costs then logic would dictate that the real numbers are an increase from 5.5% to 10%. Those numbers just might pass scrutiny in Arbitration; they would certainly have a better chance than the 1.5% to 10% jump. This makes a potential increase in healthcare payments a somewhat more than likely occurrence if the MTA has its way and we are forced into impasse induced PERB arbitration.
To combat this, the Union must come up with a strategy to do everything possible to be able to walk out with the best outcome for the membership. The strategy in all likelihood should be to come to an agreement on healthcare expenditure before a possible impasse is declared. Because a PERB arbitration panel only decides on unresolved issues, not issues that were previously agreed upon. If it can be calculated by proportion, it stands to reason that if the 1.5% HC contribution is equal to 5.5% in premiums then a .5% raise of the 1.5% HCC would be equal to a 7.33% in premiums. That number may be acceptable to the MTA and more importantly by the membership. Again if proportion calculations are an acceptable method of calculation then the proposed 10% increase the MTA wants would be closer to a 2.75% HCC or an increase of 1.25 to our current 1.5% rate.
Of course that is the way to a negotiated settlement on this issue. The above is in accordance with the principles of compromise and mutual respect to an adversary. In other words, don’t ever assume the MTA will look for a fair agreement. The MTA will always look for whatever the current administration that is in power at the MTA feels is in their advantage. In many ways there can be no fair contracts. This is why many members were upset with a former President hugging his opposite number after a particularly nasty contract fight a few years ago. Contracts can only be seen as gaining ground or losing ground.
Perhaps there is a third way to go: if the increase of healthcare costs are inevitable, then perhaps we should parlay those changes into something we have wanted for decades; recognition as a uniformed service. Recognizing Transit workers as a uniformed service has many clear and substantial benefits. Chiefly among them would be contract parity with NYPD, FDNY, Corrections and Sanitation. Transit workers would then have a real shot at a 25 year no age pension and inclusion into the heart bills and lung bills, not to mention yearly variable supplements and better longevity pay and uniform allowances. It may be a stretch but worth the try.
RETIREES AND FUTURE RETIREES ARE ABOUT TO BE SOLD OUT.
ReplyDeleteSunday, February 12, 2012
SAMUELSEN SEEKS TO RAID RETIREES BENEFITS!
New York
Union says MTA's sitting on a fortune, can afford raises & restore service
TWU sees unused $474M in health care fund
By Pete Donohue / NEW YORK DAILY NEWS
Saturday, February 11, 2012, 7:25 PM
Bryan Smith for New York Daily News
TWU Local 100 President John Samuelsen, seen at a January protest of proposed cuts to members' health care services, says the MTA has enough money in a health care fund to pay for union raises and restore service cuts.
The MTA can pay transit workers raises — and restore cut service — by tapping an obscure health care fund, Transport Workers Union Local 100 says.
The fund, established in 2006 to cover the future health care benefits of retired transit workers, has grown to nearly $474 million in six years.
The Metropolitan Transportation Authority plans to deposit another $59 million into the Other than Pension Benefits (OPEB) fund this year and an additional $129 million by 2014.
“It clearly demonstrates they have the ability to grant raises,” Local 100 president John Samuelsen said. “We’re not asking for the world. We’re asking for cost of living increases.”
The MTA also could use some OPEB money to bring back bus and subway services that were cut in 2010 to close a budget gap, he said. The cuts included the elimination of dozens of bus routes.
But the MTA says dipping into the fund would be terribly short-sighted and bad for workers.
Using a series of calculations involving escalating health care costs, the life expectancy of the work force and benefits granted in past contract, the MTA calculates retiree health care will total about $13.2 billion.
“Raiding the fund is grossly irresponsible and completely ignores the serious unfunded liability of $13 billion that the MTA must grapple with,” Chairman Joseph Lhota said.
Public agencies have to report how much of their future financial obligations to retirees are unfunded. They are not legally mandated, however, to set aside any money for the purpose. Nor are they prohibited from using some money that is set aside for other purposes like raises and service.
The contract between the MTA and 34,000 bus and subway workers expired Jan. 15. The MTA has said it can only afford raises if the union agrees to work-rule changes or other measures to cover the cost.
Each 1% raise in wages would increase MTA expenses in its $12.6 billion operating budget by $25 million.
The MTA and Local 100 have had a few negotiating sessions since the contract expired but remain far apart on a deal.
pdonohue@nydailynews.com
From NYDailyNews.com
I think it is important not to get too excited about every article that comes out about contract negotiations.
ReplyDeleteAllegations of "selling out retirees" are nothing but political Bullspit.
As for the main piece it is thought provoking. It asks the question do we truly negotiate? or do we wait for the inevitable? Negotiation is not always coming away with more it is sometimes keeping a little less. But not giving away everything.
One thing is for sure this negotiaition will go on for a long time and no one can say what the outcome will be right now.