April 17 (Bloomberg) -- The Metropolitan Transportation Authority and the union representing New York City’s subway and bus workers agreed on a tentative contract that would raise wages by 8 percent over five years without fare increases.
The accord, announced in Manhattan today by Governor Andrew Cuomo, also would raise worker health-care contributions to 2 percent of base pay from 1.5 percent. It needs the approval of union workers and the MTA’s executive board.
The deal ends a two-year stalemate between the state agency that operates the largest U.S. transit system and about 34,000 workers represented by the Transport Workers Union Local 100.
“It was hard on both sides and I think it was a fair resolution on both sides,” Cuomo said at a press briefing. “There will be no fare increases due to this contract negotiation and it is in keeping with the MTA’s long-term financial plan.”
Cuomo, a 56-year-old Democrat who faces re-election in November, stepped into the negotiations yesterday as the union threatened a strike if the authority didn’t back off a demand for a three-year wage freeze. The union had a three-day strike when negotiations broke down in 2005. Today’s deal may signal how the state can limit employee costs when the contracts for about 122,000 workers expire in about two years.
The freeze proposed by the MTA, which employs 66,000 workers and carries 8.5 million riders a day on subways, buses and commuter railroads in the New York City area, was similar to one Cuomo brokered with the state’s two biggest unions in 2011. At the time, the state faced a deficit of about $10 billion. Cuomo is predicting a more than $2.2 billion surplus over the next five years, though that depends on holding spending growth to 2 percent annually.
“The state was in a much different economic circumstance,” Cuomo said of 2011. “It’s a much different situation.”
The new MTA contract raises wages by 1 percent in each of the first two years and then by 2 percent in each of the final three years. It also includes paid paternity and maternity leave.
“The union believes we’ve achieved many of the goals we set out to achieve,” John Samuelson, the union president, said at the briefing. “It’s a fiscally responsible agreement.”
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