As the Baker Administration works with the state legislature to determine the future course of the MBTA, a critical component of this deliberative process should be revisiting and interpreting the long-standing, often contentious history of interest arbitration between the MBTA and its public employee unions. The Boston Carmen’s Union, ATU Local 589, is the largest of the MBTA’s 28 bargaining units, representing roughly 3,500 employees over a range of 45 distinct job classifications—or approximately 55 percent of the MBTA labor force. The outcome of the MBTA’s negotiations with Local 589 typically sets a ‘pattern’ that the other MBTA unions follow. This method is not based on statute or in collective bargaining agreements, but is a practice that has emerged over iterations of negotiation cycles between the MBTA and its unions because of Local 589’s relative size and influence.
Since the legislature provided the fundamentals of today’s interest arbitration process with the passage of Chapter 405 in 1978, the MBTA and its unions have negotiated eight agreements and many of these processes have ended up in interest arbitration. In fact, since the Carmen’s Union was founded in 1912, nineteen of its fifty-three rounds of negotiation on the ‘basic working’ collective bargaining agreement have been finalized through interest arbitration.
This process has not served the citizens of the Commonwealth well in terms of improving the performance of their public transportation system or with respect to the above-market costs they pay to run the system. The arbitration process places inordinate power in the hands of a single, unaccountable arbitrator and has resulted in hundreds of millions of dollars of costs to the taxpayers of Massachusetts. Yet, this system has remained out of the public eye for decades.
In response to the extreme policy challenges posed by the “catastrophic failure” of our region’s mass transit system this past winter, the Pioneer Institute is conducting an examination of a set of public documents from state superior court that include the parties’ legal briefs and exhibits from the most recent round of interest arbitration – Massachusetts Bay Transportation Authority and Local 589, Amalgamated Transit Union, AFL-CIO, CLC for the Contract Period July 1, 2010 through June 30, 2014 (the “2010-2014 Interest Arbitration”).
Our goal is to identify data points from these documents that pull back the curtain for the citizens and policymakers of the Commonwealth to shed some light on how the interest arbitration process functions and describe how the process often results in above-market wages and benefits of MBTA union employees relative to other public-sector peer groups.
We intend to post relevant portions of the documents in their original form with a brief description to provide the reader with appropriate context.
The tranche of court documents posted below is drawn from transcripts of testimony on behalf of the MBTA before the arbitrator, as well as from post-arbitration-hearing briefs submitted by counsel for the MBTA, Philip. G. Boyle and an expert witness testifying on behalf of the agency, economist Ethan P. Zimmer. These documents present a number of valuable analyses and findings with respect to the comparative compensation of MBTA employees that will provide the Commonwealth’s citizens and lawmakers with a more clear understanding of the labor-cost issues facing the MBTA.
The first documents we present compare wages for five separate categories of public employees at the MBTA to wages for equivalent positions in a range of municipalities served by the MBTA. The documents indicate that in virtually every classification surveyed, MBTA wages far exceeded those of municipal peer groups.
A breakdown of minimum weekly rates for the position “repairman”, for instance, shows MBTA employees in this category making 8 percent more than employees in the next highest peer municipality, the Town of Brookline, and 70 percent more than equivalent workers employed by the City of Boston, which is the lowest-paid in this category of employee. An analysis of maximum weekly rates for this category reveals the same dissonance in wages: ‘repairmen’ for the next highest-paying peer group, the Town of Belmont, make just 79 percent of the wages paid to their MBTA counterparts, and the lowest-paid peer group, repairmen employed by the City of Somerville, make just 53 percent of this amount.
For the classification “stockman”, the results show MBTA employees make 27 percent more than equivalent laborers in the Town of Brookline in minimum weekly rates. Compared to equivalent workers for the City of Boston, the peer group with the lowest pay according to the data provided in this survey, MBTA ‘stockmen’ make 170 percent more. In the comparison of maximum weekly rates for this classification, wages for MBTA stockmen are also 27 percent higher than the next highest group, the Town of Brookline, and still 97 percent higher than wages for stockmen working for the City of Boston.
For the category “laborer”, a comparative survey of maximum weekly rates shows MBTA workers making upwards of 32 percent more than the next highest-paid peer group, the City of Newton, and 69 percent more than peer ‘laborers’ employed by the City of Boston. A comparison of minimum weekly rates shows the MBTA second only to the City of Brookline in terms of compensation within this classification. Overall, the mean maximum weekly rate for all of the MBTA’s peers in this classification is only 67 percent of the MBTA rate—for the mean minimum weekly rate, data show municipal peers making 89 percent of what their MBTA counterparts are paid.
A comparison of wages for the classification “truck driver/MEO” further illustrates this trend. Comparing minimum weekly rates for this classification of MBTA workers to those of peer groups shows MBTA wages are over 58 percent higher than the average of the group, 36 percent larger than the second-highest paid group, the Town of Brookline, and double the wages of equivalent workers employed by the City of Boston. In a survey of maximum weekly rates, the results are not much different, with MBTA wages exceeding the next highest-paid municipality, the City of Watertown, by 25 percent, and the lowest-paid municipality, the City of Boston, by 68 percent.
The comparative survey of the fifth classification of worker —“cleaner”— reveals similar wage disparities between the MBTA and its municipal peers. MBTA car cleaners, according to the data in this survey, make 26 percent more than their Town of Brookline counterparts, 99 percent more than their City of Boston counterparts, and 59 percent more than the average of the group, in terms of minimum weekly rates. An examination of maximum weekly rates points to the comparable differences in compensation: the group’s average maximum is equal to just 77 percent of the MBTA’s maximum. The next highest municipality, the City of Watertown, pays its cleaners a maximum equal to just 91 percent of this amount, and the City of Boston—the lowest-paid in the group—pays their cleaners just 64 percent of the MBTA’s maximum weekly rate.
As the primary documents and corresponding charts below illustrate, the comparative data on wages reveals the same trend throughout all five classifications: MBTA employee pay levels are well beyond those in peer municipal government groups.
Also, from these documents, readers can see that the arbitrator understands the MBTA’s argument put forth through its counsel, Peter Boyle, but nevertheless rejects the MBTA’s claim that it needs to narrow the gap in pay. Essentially, the arbitrator concludes that MBTA employees have always been paid more and she wants to maintain that “historical ratio.” The arbitrator reasons that “this continuity (of wage differential) has prevailed through numerous…arbitrated decisions dating from (1980) and continuing in the 35 years since.” The ample data and comparisons provided by the MBTA did not move the arbitrator even slightly.
 It is important to note here that the Carmen’s Union disputes the categorization of these positions as ‘equivalent’ and argues generally that most MBTA positions are unique and cannot be compared to any other positions in either the public or private sector within the state. Though the arbitrator has regularly acknowledged the dramatic dissonance between MBTA compensation and that of comparable public employees in every round of bargaining, s/he has consistently ruled in favor of the Union on the sole grounds that future MBTA wages should stay consistent with these historical trends in disparity.