TWU Arbitration Same Deal In Different Form; 10.5% Hike, Pension Refund, But Make Health Co-Pay

By GINGER ADAMS OTIS

Veteran arbiter George Nicolau Dec. 15 issued a contract award for Transport Workers' Union Local 100 that included 10.5 percent in raises but requires members to pay 1.5 percent of their earnings toward health-benefit premiums.

GARY DELLAVERSON: 'Proves strike a waste.'

Declaring it "essentially the same deal" that had been agreed to by both parties on Dec. 27, 2005, after Local 100 President Roger Toussaint - who was re-elected less than 12 hours after the award was released - halted the union's three-day strike, Mr. Nicolau stressed that it was a "unanimous decision" among the three-person arbitration panel.

'It Wasn't Easy'

"Reaching a consensus was not by any means easy, but in the end both the [Metropolitan Transportation] Authority member and the Union member understood the value of unanimity," he said in a written statement that was released with the finalized contract.

Local 100 members have a three-year contract with the MTA that combines a pension refund, lifetime health coverage and 10.5 percent in raises with a 1.5-percent giveback in the form of employee contributions toward healthcare premiums.

GEORGE NICOLAU: Some creative tinkering.

The wage increases of 3, 4 and 3.5 percent that were in the December 2005 deal were included, and certain employees who previously made higher contributions toward their pensions will get the original individual refunds that could amount to as much as $14,000. The first raise is retroactive to Dec. 15, 2005 and the second-year hike took effect last Friday.

Medical benefits, death benefits, maternity stipends, assault pay, and all other gains along with wages will be retroactive to the original date of the agreement, Mr. Nicolau said. Beginning in January, they will receive a paid holiday for Martin Luther King Jr.'s birthday - another part of last year's torpedoed wage deal.

The pension issues proved the most difficult to navigate, Mr. Nicolau said.

'Not Exactly the Same'

"Because of legal constraints with regard to the aspect of the dispute dealing with pensions, the panel could not replicate the agreement exactly in the manner originally set forth in the December bargaining. It has, however, structured its award in a way that is designed to yield that result," he wrote in the decision.

The MTA had argued that the pension issues decided in the original contract - which included a side letter from the agency's chief negotiator, Gary Dellaverson, guaranteeing Local 100 workers would get their refunds even if Governor Pataki vetoed legislation granting it - were outside the scope of bargaining for a Public Employment Relations Board panel.

Mr. Nicolau in his decision said that the refund was a "lump-sum payment" and thus not the type of pension issue that could not be addressed through arbitration as outlined by Section 201.4 of the Taylor Law.

Can Bypass Albany

The original deal said that if legislation granting workers the refund wasn't enacted by July 2006, the MTA would place $131.7 million in a fund and reimburse workers directly.

Mr. Nicolau acknowledged that the PERB panel couldn't order the MTA or Local 100 to jointly support pension legislation granting the refunds as they had previously agreed to do.

"It can, however, direct the MTA to make a lump-sum payment to those TWU member participants with accumulated member contributions, as promised in the Dec. 27, 2005 Side Letter in the event the legislation the parties contemplated was not enough," he wrote. "[The lump sum] is not a pension benefit as defined in 201.4."

Recognizing that the MTA and Local 100 members would get tax breaks if pension refunds were ordered through legislation provided a good incentive for both to support a change in pension law, he stated.

May Get Interest

He ordered that a lump sum "pursuant to this award" be set aside, and include 5-percent interest after July 31, 2006, "but shall only be paid if the aforesaid legislation is not adopted by July 2007."

The lifetime medical coverage for Local 100 retirees was also kept in the final agreement, in part because it was linked to the MTA's demand for the 1.5-percent worker contribution toward health care.

"In the [Memorandum of Understanding], Section 4, the union agreed that active members would contribute a portion of their bi-weekly gross wages to the cost of health care," he noted. "However, in the same section, the 1.5-percent contribution was specifically agreed upon in order to 'offset the cost of retiree health benefits.' Thus, the contribution and the cost of pre-Medicare retiree health benefits were explicitly linked. Thus both must be approved."

Praise From MTA Rep

Mr. Dellaverson, who represented the MTA on the arbitration panel, said in a written statement that the agency was "very pleased with the award." He commended Mr. Nicolau for his efforts.

"Reaching a consensus award is a testament to his remarkable skill. Further, this award reinforces the fairness of the Taylor Law's peaceful dispute resolution process and proves that last year's illegal transit strike was utterly unnecessary," he said.

Local 100, which was represented on the PERB panel by one of its attorneys, Basil A. Paterson, issued its own statement blasting the MTA for not ratifying the deal after transit workers overwhelmingly approved it in April.

'Right to Be Furious'

"Every New Yorker should be furious at the MTA," said Mr. Toussaint. "Instead of voting on a contract that he signed off on even before the strike was over, Chairman Kalikow paid a white-shoe law firm nearly $2 million in a pigheaded attempt to embarrass transit workers in arbitration. At the same time the MTA threatens fare hikes and service cuts, Kalikow has no problem wasting your money for nothing."

Mr. Nicolau, reached by phone Dec. 15, stressed that the final result was equitable "and unanimous - it didn't favor one or place a burden on another."

When asked why it took nearly a year of disputes and arbitration to come to an agreement that, in its end results, exactly replicated the scuttled deal, Mr. Nicolau responded, "That's them."