ACRE's Medical co-payments for new hires VS PEB Board #240 Recommendations:

Under ACRE's “historic Agreement” with the M.T.A. for 2003-2006, all new hires now co-pay 18% of the cost of the plan plus all future adjustments for their health and welfare benefits and do not receive the life-time medical benefit that management employees receive for co-paying the exact same premium (18% of the cost) for their medical. ACRE officers stated during the ratification process “ The last and most controversial change involves medical co-pays for health coverage. We agreed that new hires, those employees hiring after this contract is ratified, would pay a portion of their health coverage. Their payment coverage will mirror the formula used by Metro-North non-agreement employees. This payment in no way affects current employees.”

ACRE officers also addressed concerns from members if this would open the door for the M.T.A. to require all current ACRE employees from having to also co-pay for their health and welfare benefits “ No, it is our position that it closes the door. The carrier's stated goal had been to get a co-pay on health and welfare payments. They have achieved their goal by receiving payments from new hires in a negotiated settlement. They could not go in front of a Presidential Emergency Board in any future negotiation and claim they didn't achieve their goal because they willingly negotiated the settlement. This is merely a matter of understanding the difference between a negotiated settlement and an arbitration settlement”. We will soon see if these ACRE officers are true to their word concerning medical co-payments for current ACRE members (hired prior to 2003) in the upcoming negotiations concerning the next contract. ACRE's sellout (cannibalism) of the new hires, ACRE membership and work rules will most likely continue.

Let's look at how the M.T.A. approached the Metro-North Coalition concerning co-payments for health and welfare benefits. Included in PEB Board #240 the recommendations on page 15 & 16 state the following information: “It is in the face of escalating health care costs that Metro-North has requested that its employees contribute toward health insurance premium costs. Specifically, Metro-North asks that “active” employees represented by the Coalition contribute 1.5% of their gross wages with an “escalator” that would increase the amount of the contribution as the cost of the insurance premium rises .”

“The most recent agreement between Metro-North and its employees in the craft or class of Conductors, Assistant Conductors and Hostlers , for example, provides that “new hires” will contribute to the premium cost of their health insurance plan at the same rate paid by Metro-North management employees, including any future adjustments ”.

“The recent Award of a Public Arbitration Panel involving represented employees of the NYCTA and Manhattan and Bronx Surface Transit Operating Authorities, subsidiary units of the MTA, directs that for the first time “active” members of the NYCTA will contribute 1.5% of their bi-weekly gross wages to pay a portion of their health insurance premiums . This employee contribution was considered appropriate as an offset for the cost of retiree health care benefits .”

“The Coalition argues that Metro-North's proposal that employees contribute to health care insurance will exacerbate the benefit disparity between LIRR and Metro-North employees, since LIRR employees do not now contribute toward their health care insurance. The Coalition further maintains that tying contributions for uniform health care benefits to compensation and hours worked would result in employees who worked significant amounts of overtime paying substantially more for the identical health care benefit than an employee who does not work overtime hours ”.

The Coalition argues that a more equitable plan is contained in a recent Agreement between Southeastern Pennsylvania Transportation Authority and the Brotherhood of Locomotive Engineers and Trainmen , caps employee contributions at 1% of gross wages for 40 straight time hours of work .”

What did the Board Recommend? “In view of the Board's other recommendations, and considering the equities of the situation, the Board recommends that the parties be in agreement to the following terms of the settlement: Employees hired after the effective date of this Agreement will contribute 1.5% of 40 hours of their weekly gross wages by payroll deduction to offset premium costs for the current health insurance plan, with an “escalator” for the term of the agreement, this escalator not to exceed 2% of gross wages in any one year ”.

The Metro-North Coalition also looked to get a “Pop Up” for their retirees. This report states on page 17 “The Coalition requests payment to retirees who are eligible for Medicare, as is provided employees of the LIRR. The purpose is to allow retirees to supplement Medical coverage.

The Coalition proposal recommends that employees who retire after the effective date of this Agreement receive a retiree “Pop Up” benefit upon becoming eligible for benefits provided under Medicare. Such retiree, the Coalition urges, should receive from Metro-North a monthly allowance of one hundred dollar ($100) for single person coverage; two hundred dollar ($200) for family coverage.

What did the Board recommend: “ A provision covering this Coalition demand was set forth in the term sheet, and the Board recommends its adoption ”.

There were two vastly distinct approaches towards employees contributing towards the co-payment of their health and welfare benefits. ACRE officers decided to use their new “interest base bargaining” theory and work in “harmony” with the MTA. ACRE officers decided to negotiate for the portion of their membership from 1988 back to 1983. Less than 1/3 of the entire ACRE membership could receive this pension benefit. Within this 1/3, most ACRE members did not receive the entire pension credit all the way back to 1983 (although Tony Bottalico, Mike Doyle and Jack Gaines did). Under the ACRE deal, 2/3's of their current membership and all future hires had to pick up the tab for the senior member walking out of the door.

The Coalition officers decided to negotiate for benefit of their entire membership (current and future employees), not just the senior members walking out of the door.

M-N Coalition officers decided to standup and challenge the MTA by rejecting the “historic” ACRE deal and taking these two issues before a Board. They decided to negotiate and bargain in good faith, not roll over and take what the MTA told them was a good deal.

A few critical and interesting facts must not be overlooked concerning PEB Board #240:

•  For the past four years the MTA demanded the Coalition accept the “historic” ACRE deal including the 18% co-payment of health and welfare payments for new hires without the lifetime medical benefit.

•  When the MTA went before this PEB Board instead of demanding the Coalition accept the ACRE deal, the MTA only requested that active employees contribute 1.5% of their gross wages with an escalator.

•  The Board only mentioned ACRE 1 employees as contributing towards health insurance premiums at the same rate as management employees including any future adjustments. The 18% co-payment rate was never mentioned by the Board, or the fact that ACRE members do not receive the lifetime medical benefit like M-N management employees.

•  The MTA agreed to NYCTA employees and Bus operators only contributing 1.5% of their bi-weekly gross wages towards their medical premiums. NYCTA and Bus retirees receive health care benefits.

Why did the MTA change course over the issue of co-payment of health and welfare benefits concerning M-N Coalition members? Was the MTA afraid to lose this issue before the Board, considering the 18% co-payment came without the lifetime medical benefit? Was the MTA concerned about the fact that they just agreed with the NYCTA and Bus Operators to only accept 1.5% of their wages as premium with the lifetime medical? Was the MTA concerned that throughout the transportation industry, most other recent settlements tie the co-payment of medical premiums to the standard workweek?

One other critical issue that cannot and must not be overlooked: ACRE officers left the medical “pop up” for retirees on the table during their contract negotiations with the MTA. The M-N Coalition asked for and the PEB Board agreed that was it is only fair that the medical “pop up” for retirees be granted. On page 8 of the PEB report it states “ Metro-North submits the Term Sheet, supplemented by work rule/productivity changes and other pension and benefit provisions as contained in Memoranda of Understandings as were distributed to each of the separate bargaining units of the Coalition in October 2006, provides terms that are equal to and consistent with those contained in Metro-North's agreement with ACRE represented employees in six other bargaining units. Metro-North further argues the Term Sheet and work rule/productivity changes are similar to and equal in value to the agreement it entered into with ACRE and the agreement the LIRR entered into with the United Transportation Union (“UTU”). The MTA clearly states these contracts are of equal value. LIRR and M-N Coalition retirees' get a “pop up” while ACRE members do not.