State Bill to Force SSA Into Binding Arbitration Riles Managers, Islanders

Gazette Senior Writer

A proposed state bill has raised the specters of lost management control over Steamship Authority labor costs and a possible work slowdown at the boat line this summer.

The SSA is digging in against Senate bill 2459, which would require the boat line under certain conditions to submit to binding arbitration on collective bargaining disputes.

In particular, the bill would authorize an arbitrator to determine wages, benefits and terms of employment for unionized SSA employees, should the boat line be unable to negotiate a new collective bargaining agreement with the union representing those employees within five months after the prior union agreement expires.

SSA general manager Wayne C. Lamson this week called the bill dangerous legislation.

"Senate Bill No. 2459 would entirely deprive the Islands of their control over the most significant aspects of the Authority's operations and finances," he said in a statement released Monday. "The management and control of labor costs have the greatest impact on the Authority's rates and tariffs, which Island residents have no choice but to pay in order to travel back and forth to the mainland and obtain their necessities of life."

On the Vineyard, where memories are still fresh of the bitter two-year battle over legislation engineered by New Bedford that resulted in the expansion of the SSA board in 2002, Island leaders are already rallying against the bill. On Wednesday, the Dukes County Commission voted 6-0 to support the boat line in its opposition to the bill.

"We need your help on this matter," Vineyard SSA governor Marc Hanover of Oak Bluffs told the commissioners. "This bill needs to be stopped."

County commission chairman John S. Alley echoed the sentiment, calling the legislation reprehensible. The commissioners plan to sponsor a public meeting in the coming weeks for Vineyard officials and residents to discuss the bill and its ramifications.

The boat line provides the only year-round passenger and vehicle ferry service between the mainland and the islands of Martha's Vineyard and Nantucket.

Sen. Marc Pacheco, D-Taunton, authored the bill, which is now in the Rules Committee - one committee vote from moving to the floor of the Senate. The bill was originally filed in December 2004; it was then redrafted significantly, emerging in its current form in March of this year.

Mr. Pacheco is a known friend of labor, and the author of the Pacheco Act, a state law intended to prevent public agencies from using private contracts unless they can demonstrate cost savings. Boat line compliance with the Pacheco Act was written into the same 2002 amendment of the Authority's enabling legislation.

"The Steamship Authority and the workers have been in a labor dispute now going on four years," Mr. Pacheco said Wednesday. "That's an extraordinary amount of time, way outside the reasonableness of what might be expected."

Neither of the Vineyard's two elected representatives in the legislature - Sen. Robert O'Leary and Rep. Eric T. Turkington - give the Pacheco bill much chance of passage.

Mr. Turkington said: "I think the negotiating should be handled through collective bargaining, and not through the legislature's involvement. We don't need the legislature sticking its nose into this thing."

Senator O'Leary said the legislature does not have much appetite to step into SSA issues following the battle to alter the makeup of the Authority board. Even were the bill to pass the legislature, he said, Gov. Mitt Romney would veto it.

Mr. O'Leary is, however, tracking the bill to see if Senator Pacheco tries to attach it to the Senate budget bill now under consideration for the coming fiscal year.

Senator Pacheco said he has not yet decided whether to try attaching the bill to the budget legislation. So far, he said, the bill has been moving forward on its own.

The senator also said the legislature can take the steps to resolve the situation before employee frustration spills out beyond the bargaining table.

Although Senator Pacheco said SSA employees are prohibited from striking, he said they can set up informational picket lines. And he said other boat line unions may choose not to cross those lines, which he said could effectively close down the boat line's operations. Such a scenario, he said, could pose a serious problem for the residents of Martha's Vineyard and for the Island's tourism-based businesses, especially in the summer.

Senator Pacheco filed the bill in response to the slow pace of negotiations between the Authority and unlicensed vessel workers represented by the Marine Engineers' Beneficial Association (MEBA). The contract for the 230 workers included in the unit expired in April 2003. The workers, who perform such work as taking tickets and cleaning the vessels, haven't seen an increase in their base pay since 2002.

The association also represents another bargaining unit of Authority employees: the boat line's 35 marine engineers. Their contract expired in April 2004.

MEBA representative William Campbell said the union asked Senator Pacheco to file the bill.

The union supports the bill, Mr. Campbell said, because MEBA believes the legislation levels the playing field. "It's a matter of fairness. The state will not allow us to strike. There's no incentive for the Steamship Authority to bargain in good faith," he said

Mr. Campbell said the Authority would have no reason to fear an arbitrator were the boat line negotiating in good faith.

Yesterday, Mr. Campbell said he was surprised to hear that the boat line would support a fact-finder on the negotiations as a step short of arbitration. A fact-finder would analyze the situation and publicly state what positions on either side could be considered unreasonable.

Mr. Campbell said the union too would support a fact-finder. "We'll support anything that gets us a contract," he said.

The Authority, which negotiates with eight bargaining units, has signed contractual agreements with five of them, and has reached tentative agreement with the sixth unit, which represents the boat line's bus drivers and parking lot employees.

Asked what is holding up deals for the two MEBA units compared with the other unions, Mr. Campbell said the MEBA workers have been asked to give up far more than the other units.

The bill has put a spotlight on the boat line's labor costs, a continuing source of concern for the boat line's managers and board of governors.

The governors and managers have said labor accounts for more than 60 per cent of the boat line's $67 million in expenses, and that the Authority's marine engineers and unlicensed vessel employees are among the highest paid in the nation.

MEBA representative William Campbell disputes whether the union members in fact are paid so highly, in large part because of a number of them are away from home during their shift and must remain on the ferry. Mr. Campbell said they have to spend 52 1/2 hours on the ferry to receive 42 hours of pay.

Because the SSA does not receive any operating subsidies, the boat line managers have said, any increase in costs must be borne by the passengers and shippers who use the boat line. Those costs, they say, fall mostly on the residents of Martha's Vineyard and Nantucket, who rely on SSA ferries for travel to the mainland and the necessities of life.

The unlicensed vessel employees, who form the largest bargaining unit at the Authority, are routinely the target of the boat line's attempts to reduce staffing on the ferries.

Last year, Mr. Lamson said the Authority had reached severance agreements with 23 unlicensed vessel employees. By eliminating those positions, Mr. Lamson said, the boat line would save $1 million per year. He said the move would reduce staffing on the large passenger/vehicle ferries from 14 to 13 or 12 on the year-round Nantucket run, and from 14 to 13 on the off-season Vineyard run.

But what Mr. Lamson did not say - and what was not revealed until the Authority on Monday released a 10-page position paper on the Pacheco bill - is that the boat line in February 2005 also reached an agreement to otherwise maintain unlicensed employee staffing levels through April 15, 2011.

"We agreed to those manning scales despite the fact that they exceed the minimum manning crew complements required by the U.S. Coast Guard for the safe operation of each vessel, including emergency situations," the position paper states. "Indeed, our estimate is that the additional employees required under the Manning Agreement will cost the Authority more than $3 million each and every year (at current wage rates and benefit costs), but we felt that such additional expense was appropriate in the interest of maintaining labor harmony."

The paper cited the extension of the Manning Agreement as an example of its willingness and ability to reach agreements with MEBA.

At a boat line where the governors and managers consistently express concerns about labor costs, the $3 million in foregone savings translates into about 7 per cent of the Authority's labor costs and 4 per cent of its overall expenditures.

Mr. Lamson yesterday said that while the Authority could have dropped manning on the large boats to nine workers, he anticipated that the union would have fought a lengthy battle on the move, including complaints that would have drawn in the Coast Guard.

Mr. Hanover, who was chairman of the board of governors when the boat line extended the manning agreement, said the decision helped avoid layoffs at the boat line. He also said he had concerns about taking the boats down to the minimum level during summer Vineyard trips when 1,200 to 1,400 people can be aboard a single vessel.

As for wages, Authority records show many of the unlicensed employees made between $40,000 and $50,000 in boat line pay in 2004.

In its position paper, the Authority said the engineers, who supervise the operation of the vessels' engines, receive annual wages between $80,000 and $100,000.

According to a December 2005 letter from Mr. Lamson to the unlicensed employees, the boat line was offering a 6 per cent wage increase over present levels and a 3 per cent increase on the following three anniversary dates.

But Mr. Lamson said the key issues involve work practices rather than pay.

"In collective bargaining, the Authority has been attempting to address with MEBA several long-standing issues aimed at improving productivity, operational efficiencies and employee discipline, and reducing overtime and premium pay abuses resulting from contract restrictions," Mr. Lamson stated.

"MEBA has opposed every effort of the Authority to introduce even limited reforms," he stated. "If Senate Bill No. 2459 becomes law, MEBA knows that it will never have to agree to any of the long overdue reforms the Authority is seeking."

In the negotiations, the Authority has been asking the unlicensed employees to contribute 5 per cent of their health care premiums (the Authority now contributes 100 per cent), and to forego premium pay for certain jobs performed during regular shifts, such as hooking up the vessels at night to shore power.

Mr. Campbell said the unlicensed employees have agreed to the 5 per cent contribution, pending approval of a new contract. But he defends the use of premium pay, which he said is common through the industry.

The major sticking point so far in the stalled negotiations with the engineers has been retirement pay.

The Authority and the union, however, describe the facts of that dispute differently.

"MEBA insists that the Authority both continue participating in its defined benefit pension plan that provides the Authority's marine engineers a retirement benefit, at any age, of 88 8/9 per cent of their base wages (the average for any three years that produces the highest pension) after 30 years of service (or 53 1/3 per cent of their base wages after 20 years), and continue making contributions to the marine engineers' defined contribution plan, which, conservatively invested, can almost double the size of the marine engineers' retirement benefit," the Authority states.

Authority employees, the boat line states, also receive social security benefits, unlike employees of the state and local municipalities.

Mr. Campbell, however, said the Authority "doesn't pay one nickle" into the defined benefit pension plan.

Yesterday, Senator Pacheco said people keep asking him why he filed the Steamship arbitration bill.

"Legislation usually gets filed when something isn't working," he said.