Working Together – Not Against, In Salem

As most of you are painfully aware, negotiating successor collective bargaining agreements these days seems to take a long, long time. TriMet’s contract expired on November 30, 2009, has not settled, and is tied up in protracted litigation. C-Tran’s coach and paratransit operator contract expired August 31, 2010 and is headed toward interest arbitration.

The Salem Area Mass Transit District’s contract with the Union expired on December 31, 2009, and after more than sixteen months of negotiations, the parties ratified a new three year agreement. So why did the Salem contract settle, while the others have not?

The trend by some transit systems in Oregon and Washington is to continue their current service levels, even when the taxpayers won’t pay for it. Obviously they haven’t been able to figure out that if you can’t afford the service you’re currently providing, and the taxpayers are saying no more, then you should do something about it.

Unfortunately for the workers, the first thing these transit managers want to do is cut employee wages and benefits because it’s an easy fix. They continue to operate the same level of service that taxpayers won’t fund, they keep the same size work force to operate the service that taxpayers refused to fund, and they accomplish this by cutting employee wages and benefits by 20-30 percent.

We all recognize the difficult economic times that local governments in Oregon and across the country are facing. Both sides to any agreement have to be willing to compromise, but if compromise is to be successful, it can’t be one-sided.

Unlike TriMet and C-Tran who apparently believe it is necessary for their employees to take the hit because of sagging revenues and less funding, the Salem Area Mass Transit District saw it differently. They recognized that the need to make cuts had to be balanced along with the needs of their employees. The District told the attorneys to stay home and the general manager came to the table to settle the contract, and did!

The Amalgamated Transit Union Local 757 has been around for more than 94 years. Throughout this time, negotiating and maintaining quality benefits such as medical insurance, has remained one of its top priorities. The importance in maintaining those benefits today is no different.

Several years ago in Salem, to maintain the same level of health plan benefits, the District changed from a health insurance plan with no deductibles, to one with a $100/$200/$300 annual deductible depending on whether you were a single employee, employee plus one, or family. By achieving lower premium costs through this change, the District agreed to contribute $338 a year into an individual HRA VEBA medical savings account for all employees. The change to insurance benefit levels was “seamless.”

Then now, as with other employers, the Salem Area Mass Transit District was hit with higher insurance premium renewal rates and to address the higher costs in light of reduced revenues, the District and the Union worked together to help reduce costs while recognizing the importance of maintaining quality health care.

To achieve this goal, the District and the Union agreed to change insurance providers and increase deductibles in order to maintain the same level of benefit coverage for employees and their families. With significant savings to the District by increasing medical insurance deductibles to $1000/$2000/$3000, the same coverage was maintained. The District, however, agreed to pick up the increased deductible and to maintain 100% employer-paid premiums during the life of the new three year agreement. Through a third party administrator, the District will process and pay the increased deductibles. Employees will have the option to submit paid bills for reimbursement, or provide invoices for direct payment by the administrator to the healthcare provider.

For example, a single employee will still be required to meet the first $100 deductible. The District will then pay anything above that amount to the maximum $1000 plan deductible. An employee with one dependent still pays the first $200 of the deductible, and the District will pay anything over that to the maximum of $2000. And employees with family will continue to pay the first $300 of the deductible, and the District will pay the difference to $3000.

All employees will continue to receive the $338 annual District contribution to their individual HRA VEBA accounts.

For the past several years, wages for Salem Area Mass Transit District employees have increased steadily by more than three percent a year. Again, recognizing difficult economic times, but not placing the burden solely on the backs of it’s employees, the parties agreed to increasing employee wages by two percent effective July 3, 2011; two percent effective January 1, 2012; and two percent effective January 1, 2013. The top operator rate will go from $21.13 to $22.42 an hour during the life of the agreement. Journey mechanic top rate goes from $25.51 to $27.02 an hour. These rates do not reflect longevity premiums, which remain unchanged.

There were several minor contract language changes, none representing take-a-ways, the new agreement is important in that it recognizes the contributions made by District employees. It also illustrates that when you work together, rather than against one another, compromise can be achieved.

Jonathan J. Hunt

President – Business Representative

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