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TriMet declares impasse in contract negotiations

TriMet declared an impasse in its contract negotiations with Amalgamated Transit Union 757 on Wednesday, a move that starts the process for a state-authorized mediator to approve the next labor agreement between the regional transit agency and the union representing most of its employees.

There are several steps TriMet and the union must follow in coming weeks before that happens, and the two parties could reach an agreement before the mediator is required to do so. But the most recent contract between TriMet and ATU 757 was approved by a mediator.

In a statement released Wednesday morning, TriMet said it declared the impasse after 37 days of collective bargaining and two mediation sessions which resulted in no meaningful progress. State law governs the bargaining process and prohibits TriMet employees from striking.

TriMet is seeking concessions from the employees, which the agency says are necessary to assure its longterm financial stability. They include requiring the employees to pay more for their health care benefits. The union says TriMet should cut management and stop doing light rail projects instead.

The last contract, the one approved by the mediator, expired 18 months ago. It has been challenged by ATU 757 and upheld by the state Employment Relations Board. The union appealed that decision to the Oregon Court of Appeals, which has yet to issue a decision.

TriMet's complete statement is as follows:

After 37 days of contract negotiations and two mediation sessions, but no headway on the major issues, TriMet today took the next step in the negotiation process and declared that negotiations with the Amalgamated Transit Union Local 757 (ATU) have reached an impasse. This is the next major step in the strike-prohibited bargaining process outlined by state statute. TriMet is required to take several steps for collective bargaining that can include negotiations, mediation and binding interest arbitration.

TriMet Executive Director of Labor Relations and Human Resources Randy Stedman said that the core issues in these negotiations are wages and healthcare costs.

“Since December 2012, we’ve worked hard to negotiate a contract that is very competitive for our employees and retirees, but also fair to our riders and taxpayers,” said Stedman. “We’re asking for our union employees and retirees to share in the cost of their healthcare benefits at a level comparable to TriMet’s peer transit agencies and with that, we’re able to ensure TriMet’s fiscal stability for years to come.”

Stedman added, “We remain open to further mediation with the ATU, but our employees deserve an orderly and timely resolution of the expired contract.”

ATU members have been working for nearly 18 months without a contract. Because healthcare cost increases are passed on to employees while they are between contracts, many of our employees are paying more for their health care benefits now than if they had accepted TriMet’s offer. Stedman concluded, “Even with our offer, active employees and existing retirees will have extraordinary healthcare benefits.”

Background

• The prior three-year contract between TriMet and the ATU expired on November 30, 2012, just four months after an arbitrator selected TriMet’s offer.

• The ATU has appealed the arbitrator’s prior award to the court of appeals.

• At the conclusion of the 150-day bargaining period in successor contract negotiations, the parties were unable to reach agreement.

• On February 5, 2014 TriMet requested a state mediator assist with negotiations. Two mediation sessions were held on April 8 and May 8, but the parties remained far apart on the core issues.

• State law requires that after the minimum 15-day period of mediation, either party may declare an impasse. TriMet today sent notification of the impasse today to the State Employment Relations Board (ERB).

• The January 2014 Secretary of State’s audit found that TriMet’s “most serious and looming concern” is related to the cost of retiree healthcare. TriMet is working to reform these benefits through contract negotiations to be in line with peer agencies.

An April 2014 valuation of the retiree healthcare liability, known as Other Post Employment Benefits (OPEB), shows that the unfunded liability has increased from $852 million to $950 million, which is roughly twice the size of our annual operating budget.

Next steps

• Within seven days after declaring impasse (May 15), each party submits its “Final Offer,” including any proposed contract language and each party’s cost summary related to issues where the parties have failed to reach agreement. ERB makes the Final Offers public.

• If a tentative agreement is reached prior to binding arbitration, ATU members would vote to ratify the proposed contract and TriMet’s board of directors would also ratify the agreement. If no agreement is reached, the parties move into binding arbitration.

• Following selection of an arbitrator and a 30-day cooling off period, each party submits its “last best offer package” 14 days before the arbitration hearing. Following the hearing, the arbitrator selects only one of these offers. The arbitrator cannot combine elements from both offers.

• The arbitrator’s selection of the offer is binding upon the parties. There is no vote by either side on an award made by the arbitrator. The arbitration award, results in the new collective bargaining contract between TriMet and the ATU for the term of the award.

The ATU represents more than 2,100 TriMet employees.