HARRISBURG, PA. (Jan. 26, 2005) — Pennsylvania Turnpike Commission officials today issued their final report on the overall financial impact of the Teamsters’ Union strike that occurred last November. According to the report, the seven-day labor action cost the Commission $3.4 million in all.
The report broke down the strike’s financial impact as follows: The Commission lost $4.2 million in toll revenue — including a 20-hour period when it waived tolls altogether — plus an additional $900,000 in affiliated expenses (namely overtime, travel and lodging, and temporary labor) for a total impact of $5.1 million. But since the Commission did not pay picketing union workers, the loss was softened by payroll savings of $1.7 million.
Turnpike executives said they anticipate a prompt recovery of that revenue without having to sacrifice spending on any capital improvement projects. “The strike did take somewhat of a toll on our operating budget’s bottom line,” said CEO Joe Brimmeier. “But we expect to quickly recoup those lost earnings by the savings that we’ll see under the new union contract.”
Brimmeier explained that, under the pact, the Commission will realize $3.1 million in healthcare cost savings alone over the next 3 years. Plus, the contract includes significant work-rules revisions about overtime and scheduling which will result in increased operational efficiency and reduced costs.
The agreement — ratified by union members Dec. 23, 2004 and approved by the five-member Turnpike Commission on Jan. 18, 2005 — is effective through Sept. 30, 2007. The new deal will provide the following annual wage adjustments to unionized Turnpike workers:
- no wage increase for the period from Oct. 1, 2003 to Sept. 30, 2004 (union bargainers had sought retroactive pay from Oct. 1, 2003 — the day the previous contract expired);
- a 55-cent-per-hour increase for the period beginning Oct. 1, 2004 to Sept. 30, 2005;
- a 55-cent-per-hour increase for the period beginning Oct. 1, 2005 to Sept. 30, 2006; and
- a 50-cent-per-hour increase for the period beginning Oct. 1, 2006 to Sept. 30, 2007.
Beginning in the fall of 2006, considering the pay increases in the new agreement, a starting toll collector will receive $17.36 per hour (or $36,108 per year); the maximum toll-collector wage will be $20.29 per hour (or $42,203 per year).
Regarding fringe benefits, the new agreement still features a fully paid health insurance package, but the HMO option has been eliminated, some co-pays have gone up, and the prescription drug benefit now includes mandatory generic and mail order stipulations.
In addition to pay and benefit changes, the new labor contract also includes modified policies that deal with employee scheduling and assignments. Some of the work-rules revisions under the new contract:
- allow the Commission to move permanent collectors to new work locations depending on staffing needs (thereby facilitating the ongoing reduction of the workforce through attrition);
- enable expanded use of supplemental toll collectors, allowing the Commission to better meet demand during special events and thereby reduce overtime;
- permit collectors to bid on changes to their fixed shift and interchange assignment (known as a “line selection”) more frequently, resulting in more efficient scheduling and reduction of complement; and
- authorize more flexibility in scheduling regular nighttime maintenance shifts to help control or reduce overtime costs to the Commission.
“Overall, these changes in the work rules help the commission operate in a much more cost-effective and professional manner,” said Brimmeier. “The scheduling flexibility is something we’ve been striving for to take full advantage of the economies of E-ZPass, to operate more efficiently, and perform more like a business.”
The Teamsters’ walkout — the first since Turnpike workers became unionized in 1972 — began at 4 a.m. on the day before Thanksgiving, Nov. 24, 2004, and lasted seven days until shortly before midnight on Tuesday, Nov. 30. During the walkout, some 250 Turnpike managers and office workers staffed the tollbooths and collected a flat toll to keep the highway open.
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