District Lodge 19

where it all begin

NEWS

 

On Friday, November 6, New Jersey Transit sent a letter to the White House, requesting a second PEB.  New Jersey Transit states, "Although the recommendations in the first Emergency Board report, No. 248, dated August 14, 2015, did not result in a resolution of dispute, we are hopeful that a second Board will assist the parties in achieving an agreement."

District Lodge 19 will continue to keep you updated as this matter progresses.  To view the letter from NJT, click here.

 

On October 13, District Lodge 19 and our coalition partners applied for Mediation with the National Mediation Board (NMB). Mediation was docketed the following day and Senior Mediator Terri Brown and Mediator Jane Allen were assigned by the NMB to mediate our negotiations with the National Carrier’s Conference Committee (NCCC).

Mediation will begin next Tuesday, November 3rd. We are hoping that, through mediation, we can make meaningful progress in this round of Negotiations that will provide solid wage increases for our members while retaining the benefits that we currently enjoy.  We will continue to update you as negotiations progress

 

Beginning October 1, 2015, the U.S. Railroad Retirement Board (RRB) will reduce railroad unemployment and sickness insurance benefits by 6.8 percent, down from the current 7.3 percent reduction, due to federal budget cuts required by law.

The adjusted reduction amount is based on revised projections of benefit claims and payments under the Railroad Unemployment Insurance Act. It will remain in effect through September 30, 2016, the end of the fiscal year. Reductions in future fiscal years, should they occur, will be calculated based on applicable law.

The daily benefit rate is $72, so the 6.8 percent reduction in railroad unemployment and sickness benefits will reduce the maximum amount payable in a 2-week period with 10 days of unemployment from $720.00 to $671.04.

Certain railroad sickness benefits are also subject to regular tier I railroad retirement taxes, resulting in a further reduction of 7.65 percent. Applying the 6.8 percent reduction to these sickness benefits will result in a maximum 2-week total of $619.71.

These reductions are required under the Budget Control Act of 2011 and a subsequent sequestration order to implement the mandated cuts. The law exempts social security benefits, as well as railroad retirement, survivor, and disability benefits paid by the RRB, from sequestration.

When sequestration first took effect in March 2013, railroad unemployment and sickness benefits were subject to a 9.2 percent reduction. Under the law's requirements, this amount was then adjusted to 7.2 percent in October 2013, and 7.3 percent in October 2014.

In fiscal year 2014, the RRB paid $11.9 billion in retirement and survivor benefits to about 562,000 beneficiaries, and net unemployment-sickness benefits of $84.4 million to nearly 25,000 claimants.

 

Source: RRB.GOV (http://www.rrb.gov/opa/pr/pr1508.asp)

 

CSX Corporation and two leading mechanical unions, the International Association of Machinists and Aerospace Workers (IAM) and the International Association of Sheet Metal, Air, Rail and Transportation Workers (SMART), announced a landmark partnership on Sept. 28, 2015, “that will enhance benefits for CSX employees and further improve productivity.”

“This agreement is part of CSX’s focus on promoting a flexible workforce to meet changing business demands, and developing opportunities to retain and support our highly skilled workforce,” said Cressie Brown, Vice President, Labor Relations, CSX.

Under the tentative agreement, which is being submitted for ratification, members of the IAM and SMART unions will be able to perform a variety of assigned work beyond the traditional boundaries of craft or union affiliation. Covered employees will see increased pay through an hourly skill differential, enhanced ability to retain employment, benefits and connection to railroad retirement and an ability to perform additional locomotive rebuild work in-house with CSX employees. This new agreement builds on the success of a similar work-sharing structure implemented at the company’s Huntington Locomotive Shop in 2013, CSX says.

“This new agreement is the result of tireless work between representatives from IAM, SMART and CSX, and demonstrates our collective commitment to finding innovative ways to support our employees while driving long-term efficiency,” said Lisa Mancini, Senior Vice President and Chief Administrative Officer. “I applaud our union partners for working so closely with us through the lengthy discussions that began in 2013 at our Huntington Locomotive Shop.”

SMART General President Joseph Sellers, Jr. added, “This agreement enhances job opportunities, job security and our members’ ability to transfer across the system, while also improving training and supporting skill development. Across the board, we are taking an innovative look at building relationships that support our common interests now and into the future.”

“This tentative agreement provides new options for CSX employees, giving them more control of their careers, by expanding on the efficiencies gained from our previous partnership at Huntington, West Virginia while providing CSX with the tools they need to have the most efficient locomotive maintenance team in the industry,” said Jeff Doerr, IAM President and Directing General Chairman.

 

National negotiations have been underway and the IAM, as well as our coalition partners, have met with the National Carrier’s Conference Committee (NCCC) on several occasions. We are currently discussing issues that could potentially affect the National Health and Welfare Plan. Some issues that the NCCC has brought to the table are concerns over rising healthcare costs and the potential cost increases associated with Affordable Care Act’s 2018 excise tax on certain healthcare plans.

The Affordable Care Act (ACA) provides many benefits for middle class Americans, such as, the ability for children to remain on their parents’ plans until age 26, mandating that insurance companies cannot deny coverage for those with pre-existing conditions and the elimination of annual and/or lifetime limits on healthcare. However, as it currently stands, the law calls for an excise tax of 40% for healthcare customers who receive benefits above $10,200 for individual coverage and $27,500 for family coverage.

There have been bipartisan efforts to repeal this portion of the ACA, none of which have been successful up to this point. Two bills have been recently introduced in the House: one by Democratic Rep. Joe Courtney of Connecticut that has 132 cosponsors and one by Republican Rep. Frank Guinta of New Hampshire that has 81 cosponsors. A Senate bill could be introduced this month, when the chamber returns from its summer recess.

Our benefits, as they stand now, do not exceed the threshold for the excise tax however, there is concern that rising costs of healthcare could change this by 2018. We will continue to urge legislators to repeal the excise tax in order to gain valuable leverage in this round of bargaining. We will also be working toward solutions to this potential problem that will not compromise the benefits that railroad Machinists have won over the last 100 years of bargaining.

We intend to update you as soon as any progress is made in overcoming this hurdle. We encourage each of you to call your Senators and Congresspersons and urge them to repeal the looming excise tax.

 

Locomotive Machinists on the Paducah and Louisville Railroad just ratified a new 5 year contract with over 75% of our members voting in favor of the agreement. “After a year and a half in negotiations, I believe we achieved a contract our members can be proud of”, said General Chairman Andrew Sandberg. 

 

Pertinent details are as follows:

  • Rolled in the 17 cent COLA produced to this point after the last General Wage Increase (GWI) just ahead of first GWI in this agreement (7/1/14).
  • Did not modify the Medical Plan proposal in terms of no plan changes but increases based on size of family unit to be covered.
  • Increased annual max on dental to $1500 which matches National.
  • Increased match max on 401(k) from $500 to $750.
  • Allow personal leave day carry-over in even years to odd years.
  • Added Spouse's Step-parent to covered persons in Bereavement Leave rule.
  • Increased daily payout on Supplemental Sickness.
  • Kept the 3% General Wage Increases (GWI's) starting in 2014 and each year for term.
  • Added rule to be reimbursed for CDL and added .50 differential when necessary to drive commercial vehicle.

“I am extremely pleased with the work of everyone involved with negotiating this agreement on the Paducah and Louisville Railroad. Their efforts have ensured that our members received a wage and benefits package that reflects their hard work and dedication on the job”, said President/Directing General Chairman Jeff Doerr.

For the full text of the agreement, click here.

 

Presidential Emergency Board 248 has issued its recommendations to settle the four year contract dispute between New Jersey Transit and the Rail Labor Coalition of fourteen unions representing 4,300 union workers.
  

The recommendations on the major issues of wages and health insurance contributions fall much closer to the terms proposed by the Coalition than those proposed by New Jersey Transit, although the Board did backload its wage recommendations to accommodate the railroad’s budgetary concerns. 

The PEB found that the Coalition proposals were appropriately based on settlements in the commuter industry, while the company’s unprecedented reliance on a state worker concessionary contract was not persuasive.  

Coalition spokespersons said, “The Presidential Emergency Board, composed of three veteran, distinguished neutrals, has proposed terms that represent a reasonable compromise approach to settlement. We sincerely hope that New Jersey Transit will now take this opportunity to bring this protracted dispute to an end.”

           

Summary of PEB 248’s Recommendations

 

Wages:

The Board recommends wage increases totaling 18.4% in compounded wage increases over 6-1/2 years, or 2.6% per year. When increases in health insurance contributions are factored in, the recommendation is for 17.7% over term, or 2.5% a year. (The complete proposed wage schedule is attached at the end of this article.)


Health Insurance:

The Board recommends going from a monthly fixed dollar employee contribution of $81.95 a month to a system where employees would pay a percentage of weekly straight time earnings.

The current $81.95 equates to 1.8% of the average straight time weekly rate. The Board recommends that the 1.8% rise to 2% retroactive to January 1, 2012, and then to 2.5% on January 1, 2017. (The retroactive increase would be deducted from back pay.) The average contribution at 2.5% would be approximately $134 a month. Employees who make more than the average wage would pay more; those who make less would pay less.

The PEB rejected New Jersey Transit’s proposal for a new inferior insurance plan that would be mandatory for new hires.

The PEB also rejected the company’s proposal to make employees responsible for 50% of whatever excise tax exposure the insurance plan may incur under the Affordable Care Act.

The Board recommends that the current $5 co-pay for doctor’s visits rise to $10 on January 1, 2016, and then to $15 on January 1, 2017. The Board further recommends that the co-pay for emergency room visits rise to $70 on January 1, 2016, and that, also on that date, maintenance drugs will have to be filled by mail order. The PEB rejected the company’s proposal to raise prescription drug co-pays.    
    

Ridership Passes:

The PEB rejected New Jersey Transit’s proposal to eliminate employee ridership passes.


New Hire 401(a) Contributions:

The PEB recommends that for employees hired after ratification, carrier contributions to the 401(a) plan start at 1% of earnings for the first year, and then increase by 1% each year until it reaches the current 5% received by existing employees. The Board rejected the company’s proposal to reduce contributions to a percentage of straight time earnings only. Contributions will continue to be based on gross earnings for both existing and new employees.


Conductor Certification Pay:

The PEB recommends that, upon ratification, all employees who have FRA Conductor Certification receive 20 minutes pay at the straight time rate for all full shifts worked as Conductors. This would apply to Assistant Conductors when working Conductor positions. For employees working partial shifts as a Conductor, the certification pay will be prorated.

 

What The Presidential Emergency Board Said (Excerpts)

 

Overall: 

“We have been mindful of the current fiscal climate and the funding challenges faced by the Carrier and how those factors must appropriately be balanced with the reasonable expectations of the workers who occupy a major role in the successful operation of the rail transit system at NJT.”

On Wages 

“… over the years wage settlements at NJT have closely followed the general trend of wage changes at the other large commuter railroads in the region, including LIRR, Metro-North, SEPTA and MBTA. …the Board’s recommendations are consistent with the average annual uncompounded wage increases at the four other large commuter rail carriers.”

“The average annual wage increases of all four of these commuter railroads is 2.6%, the same nominal wage rate increase recommended by the Board.”

“Historically, PEBs have not accorded significant weight to state employee agreements, with good reason.”

“The Carrier proposes a 1.4% nominal wage increase, which is further reduced by the employee health insurance contributions it seeks in this proceeding. When those contributions are factored in, the Carrier’s proposed net increase in wages is 0.6%, far outside the realm of any comparative analysis.”

“… the Carrier’s wage proposals, if adopted, would almost certainly result in the decrease of real wages for Coalition employees.”

“The recommended wage increases have been structured to lessen the impact of retroactivity by reducing the percentage wage increases during the first years of the agreement. … However, NJT’s funding uncertainties and its decision not to set aside monetary place holders for fiscal years 2012, 2013 and 2014 do not relieve the Board of its responsibility to recommend wage increases otherwise shown to be appropriate.”

On Health Insurance 

“If the Carrier’s proposal regarding both wage increases and contributions to health insurance were implemented, the average health insurance contribution on January 1, 2019… would have risen from $81.95 per employee per month to $459.54 (or even more, if premiums rose more rapidly than anticipated). … the Carrier’s proposal falls outside the current health insurance contribution trends in the industry.”

“Our recommendation would move the employees’ contributions from 1.8% to 2.5%, which we do not consider an unwarranted increase.”

 

 

What Happens Next

 

The Coalition and NJT have until November 12 to negotiate a voluntary agreement. If no agreement is reached by that time, either side or the Governor can invoke a second Presidential Emergency Board. That PEB will select the most reasonable final offer. Its recommendation again will be non-binding. The parties will then have until March 11, 2016, to reach a voluntary agreement. If no agreement is reached, self-help would then be possible.

The Coalition believes PEB 248’s recommendations provide a fair compromise and the basis of a voluntary agreement. New Jersey Transit is still evaluating the recommendations and deciding on its next steps. No negotiations have yet been scheduled.

 

[FROM THE PEB REPORT]

PEB 248

SUMMARY OF RECOMMENDATIONS

General Wage Increases:

Effective Date   Wage Increase

07/01/11              0.0%

01/01/12              0.5%

07/01/12              1.0%

01/01/13              1.0%

07/01/13              1.5%

01/01/14              1.5%

07/01/14              1.5%

01/01/15              1.5%

07/01/15              1.5%

01/01/16              1.5%

07/01/16              2.0%

01/01/17              1.5%

07/01/17              2.0%

01/01/18              Amendable

The Parties are to meet and agree upon appropriate procedures for the calculation and payment of back pay.

Contract Duration:

July 1, 2011 - December 31, 2017, with an Amendable Date of January 1, 2018

Health Insurance Contributions Levels and Plan Design:

Effective Date   Health Care Contribution

07/01/11              1.80%

01/01/12              2.00%

07/01/12              2.00%

01/01/13              2.00%

07/01/13              2.00%

01/01/14              2.00%

07/01/14              2.00%

01/01/15              2.00%

07/01/15              2.00%

01/01/16              2.00%

07/01/16              2.00%

01/01/17              2.50%

07/01/17              2.50%

01/01/18              Amendable

Co-pays

January 1, 2016 - $10 for in-network doctors' office visits

January 1, 2017 - $15 for in-network doctors' office visits

January 1, 2016 - $70 for emergency room visits

January 1, 2016 - Mandatory mail order prescription service for maintenance drugs

The Parties are to negotiate concerning any implementation of a new health insurance plan.

Conductor Certification Pay:

Effective on the date of ratification, all employees who have their FRA Conductor Certification receive 20 minutes pay, at the straight time rate, for all full shifts worked as Conductors. For partial shifts, certification pay is to be allocated according to the number of hours worked as a Conductor on any one shift.

New Hire 401(a) Contributions:

Carrier contributions for employees hired after ratification: 1% of gross wages for first year of employment, 2% for second year, 3% for third year, 4% for fourth year and 5% for fifth year and thereafter.

Ridership Passes:

No recommendation.

Work Rules:

No recommendation.

 

For the full report, click here.

 

PRESIDENTIAL EMERGENCY BOARD 248

CONCLUDES ORAL HEARINGS

 

PEB 248 is now working on its Report after hearing testimony on the New Jersey Transit contract dispute from union and company witnesses at a four day hearing held July 27 through July 30 in Newark, New Jersey.

      

The three member panel of arbitrators – Chairman Elizabeth Wesman, Barbara Deinhardt, and Ann Kenis – will issue their non-binding recommendations on August 14.

 

Union Coalition witnesses presented a strong case as to why their proposal for a contract patterned after the Metro-North and Long Island Rail Road settlements was fair and reasonable.

 

New Jersey Transit witnesses, including Executive Director Ronnie Hakim, argued that NJT could not afford the union’s proposal. Instead, NJT proposed draconian increases in employee health insurance contributions, a wholly new health plan with far lower benefits that would be mandatory for new hires, the elimination of employee passes, and meager wage increases that would be virtually wiped out by the new high contributions.

 

Specifically, the Union Coalition proposed a six year contract with 17% in total wages, averaging 2.9% compounded each year. The Coalition proposed that health insurance contributions mirror what was agreed to on Metro-North and Long Island: 2% of an employee’s weekly straight time earnings. The Coalition also proposed certification pay for employees working Conductor positions, and automatic upward adjustment of supplemental sickness rates tied to wage increases.

      

NJT, by contrast, proposed a 7-1/2 year contract with 10.9% in wage increases, plus a $1,000 lump sum. Health insurance contributions would reach 20% of the premium cost by the end of the contract, which for families in the PPO plan would be estimated to be almost $600 per month.

      

Union witnesses testified that the company proposals were out of line with every other commuter settlement, and utterly unreasonable.

      

Union economist Tom Roth demonstrated that under the company proposed health care contributions, fully one third of the workforce would suffer pay cuts over the life of the contract.

      

After the PEB issues its recommendations, the Coalition and NJT will return to the bargaining table. If no agreement can be reached, either side or the Governor can invoke a second Presidential Emergency Board by November 12.

      

Spokespersons for the Coalition released the following statement after the PEB hearings: “All eleven unions presented a united, powerful case that our proposal for a contract settlement patterned after other regional commuter settlements was the fairest way to a settlement. We believe we presented our case in a thorough, professional manner, and, that in the end, justice will prevail.”

 

After four years of negotiations with New Jersey Transit (NJT), the NJT Rail Labor Coalition was recently released from mediation by the National Mediation Board (NMB). The coalition sought release after it became clear that NJT would not make a reasonable offer. The coalition has proposed settlements patterned after the contracts achieved this round of bargaining on Long Island Railroad and Metro-North Railroad. NJT insists on concessionary contracts, with employees with families paying more than four times what they currently pay for health benefits.

Following the release from mediation, the coalition requested that President Obama form a Presidential Emergency Board (PEB) to assist in achieving a fair, voluntary agreement. Yesterday, President Obama named a PEB to aid in negotiations. "The transit rail system is vital to our nation's economy, and it's crucial that we ensure it runs smoothly," President Obama said in a statement. "That's why I'm grateful these talented individuals have agreed to serve the American people by helping to swiftly and appropriately resolve these labor-management disputes."  The board will hear arguments from each side and issue non-binding recommendations within 30 days.

The chairperson of the PEB, Elizabeth Wesman, served on the second PEB for Long Island Railroad negotiations last year. Barbara Deinhardt, former chairwoman of the New York State Employment Relations Board and Ann Kenis, a professional arbitrator for the Federal Mediation and Conciliation Service and American Arbitration Association, will be the other two members of the board. The formation of this PEB will start a 120 day cooling off period in which neither the workers or NJT can resort to self-help.

“The appointment of this PEB is a major step in ensuring that our members achieve a fair agreement”, said General Chairman Gary Naylor. “I am confident that our case for a settlement patterned after the other commuter railroads in the northeast is stronger than NJT’s case for a concessionary contract.”

We intend to keep you up to date on this matter as events unfold.

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