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There are 30 million reasons why city turned down bus union's wage demands
By Randall Denley, The Ottawa CitizenJanuary 8, 2009
One of the great misconceptions about the OC Transpo strike is that it isn't about money. From the city's point of view, it certainly is about money. Millions of dollars of it. That's one of the two reasons why councillors have shown such unusual resolve in the face of the strike.
Both the city and the Amalgamated Transit Union have agreed that a generous 3.25-per-cent retroactive increase is in order for last year. For this year and next, the city is offering two per cent, but the union is holding out for three per cent. Meeting the union's salary demands would cost the city about $1 million more in each year.
That doesn't sound like an overwhelming amount of money, but the real costs lie in the implications for other contracts at the city. Councillors have budgeted for pay increases for their other unions of 1.5 per cent a year, in keeping with what the federal government is giving its workers. Offering OC Transpo employees double that increase would seriously undermine the city's position in the other upcoming contract talks, which will go to binding arbitration if the city and its unions can't reach a deal. It would be difficult to convince an arbitrator that some city employees should get three per cent, but others only half that.
Here's where the real money comes in. A one-per-cent raise for the whole city work force costs about $10 million. The difference between the city's 1.5-per-cent target and the three per cent an arbitrator could award would be about $15 million in each year of a two-year deal.
That's a $30-million differential that would have to be borne by property taxes. Put another way, the city would have to raise taxes by about three per cent to cover that higher wage settlement.
Given all of that, it's not difficult to see why councillors are focused on holding the line on wages in the one big contract that's subject to normal negotiations. All the rest have binding arbitration provisions. The city has already settled with another union group that represents transit supervisors and special constables. That deal provided the same 2008 raise that is being offered to the ATU members, but the other workers took two per cent a year for this year and next, exactly what the ATU has been offered. The city also says that this union group made concessions worth 1.25 per cent over two years, reducing the real cost to the city to the targeted annual amount.
The bus union leaders have also seriously misread the mood among city councillors. This strike was based on the premise that councillors would quickly fold because they didn't have what it took for a fight. Even now, workers are being told that rejecting the city offer today will have them back behind the wheel of a bus next week, because councillors will give in. Wrong, and wrong again.
Councillors understand that giving bus drivers what they want will ultimately mean higher tax increases and more services on the chopping block. That's a powerful motivator to hold the line, and drivers should be aware of it.
Hard to believe, but councillors are people too, and they don't like the idea of the union pushing them around and telling them how to run the most expensive service the city offers. That's the second big reason why councillors are holding firm.
Councillors are further encouraged by strong public support. Despite the inconvenience, a city poll shows that 63 per cent of the public backs the city's position while only 14 per cent are taking the union's side. Public pressure is about the only thing that would encourage councillors to give in, and it just isn't there.
When union president André Cornellier says the mayor, the head of OC Transpo and the public should not be the ones to decide what working conditions bus drivers have, he must be thinking of some dream world in which the people who pay the salaries and those who manage the system are all subservient to the workers.
When union members vote today, they should consider how determined the other side is, and why. Even if the city were to give up the $3.4 million a year it believes can be found through more efficient scheduling, the cost implications of meeting the union's salary demand are too high.
Drivers are being offered a bigger raise than the city wants to give its other unions, plus a $2,500 bonus for helping make the bus system more efficient. It's a good deal, the best the city can afford. If the union members don't take it, they will only be postponing the day when they finally say yes.
Contact Randall Denley at 596-3756 or by e-mail, rdenley@thecitizen.canwest.com
© Copyright (c) The Ottawa Citizen
By Randall Denley, The Ottawa CitizenJanuary 8, 2009
One of the great misconceptions about the OC Transpo strike is that it isn't about money. From the city's point of view, it certainly is about money. Millions of dollars of it. That's one of the two reasons why councillors have shown such unusual resolve in the face of the strike.
Both the city and the Amalgamated Transit Union have agreed that a generous 3.25-per-cent retroactive increase is in order for last year. For this year and next, the city is offering two per cent, but the union is holding out for three per cent. Meeting the union's salary demands would cost the city about $1 million more in each year.
That doesn't sound like an overwhelming amount of money, but the real costs lie in the implications for other contracts at the city. Councillors have budgeted for pay increases for their other unions of 1.5 per cent a year, in keeping with what the federal government is giving its workers. Offering OC Transpo employees double that increase would seriously undermine the city's position in the other upcoming contract talks, which will go to binding arbitration if the city and its unions can't reach a deal. It would be difficult to convince an arbitrator that some city employees should get three per cent, but others only half that.
Here's where the real money comes in. A one-per-cent raise for the whole city work force costs about $10 million. The difference between the city's 1.5-per-cent target and the three per cent an arbitrator could award would be about $15 million in each year of a two-year deal.
That's a $30-million differential that would have to be borne by property taxes. Put another way, the city would have to raise taxes by about three per cent to cover that higher wage settlement.
Given all of that, it's not difficult to see why councillors are focused on holding the line on wages in the one big contract that's subject to normal negotiations. All the rest have binding arbitration provisions. The city has already settled with another union group that represents transit supervisors and special constables. That deal provided the same 2008 raise that is being offered to the ATU members, but the other workers took two per cent a year for this year and next, exactly what the ATU has been offered. The city also says that this union group made concessions worth 1.25 per cent over two years, reducing the real cost to the city to the targeted annual amount.
The bus union leaders have also seriously misread the mood among city councillors. This strike was based on the premise that councillors would quickly fold because they didn't have what it took for a fight. Even now, workers are being told that rejecting the city offer today will have them back behind the wheel of a bus next week, because councillors will give in. Wrong, and wrong again.
Councillors understand that giving bus drivers what they want will ultimately mean higher tax increases and more services on the chopping block. That's a powerful motivator to hold the line, and drivers should be aware of it.
Hard to believe, but councillors are people too, and they don't like the idea of the union pushing them around and telling them how to run the most expensive service the city offers. That's the second big reason why councillors are holding firm.
Councillors are further encouraged by strong public support. Despite the inconvenience, a city poll shows that 63 per cent of the public backs the city's position while only 14 per cent are taking the union's side. Public pressure is about the only thing that would encourage councillors to give in, and it just isn't there.
When union president André Cornellier says the mayor, the head of OC Transpo and the public should not be the ones to decide what working conditions bus drivers have, he must be thinking of some dream world in which the people who pay the salaries and those who manage the system are all subservient to the workers.
When union members vote today, they should consider how determined the other side is, and why. Even if the city were to give up the $3.4 million a year it believes can be found through more efficient scheduling, the cost implications of meeting the union's salary demand are too high.
Drivers are being offered a bigger raise than the city wants to give its other unions, plus a $2,500 bonus for helping make the bus system more efficient. It's a good deal, the best the city can afford. If the union members don't take it, they will only be postponing the day when they finally say yes.
Contact Randall Denley at 596-3756 or by e-mail, rdenley@thecitizen.canwest.com
© Copyright (c) The Ottawa Citizen
