(Corrects ‘legs’ to ‘eggs’ in quotation in second paragraph of article published July 11.)
July 11 (Bloomberg) -- As a strike that would shut down the biggest U.S. commuter-rail system looms, New York Governor Andrew Cuomo is seeking to ensure that the Long Island Rail Road labor dispute doesn’t damage his re-election bid.
“Winning big on Long Island means a landslide statewide for a Democrat,” said Larry Levy, executive dean at the National Center for Suburban Studies at Hofstra University in Hempstead. “One of the reasons he’s so popular is that people see him as someone who doesn’t stand on technicalities and gets the job done even if he has to break some eggs.”
While a walkout on the LIRR, which carries 300,000 riders daily, could begin as soon as July 20, cutting deals with organized labor has been a hallmark of the governor’s first term. In 2011, Cuomo got the state’s biggest public workers unions to agree to wage freezes after threatening firings. In April, he stepped into negotiations between the Metropolitan Transportation Authority and New York City’s subway and bus workers as a strike was planned.
With the railroad, the Democratic governor faces legal limitations he didn’t have when negotiating with the transit employees, said William Henderson, executive director of the Permanent Citizens Advisory Committee to the MTA. LIRR workers are governed by the Railway Labor Act, a federal law that allows unions to strike under certain conditions.
“He has great powers of persuasion, but not a lot of legal power,” Henderson said in a telephone interview. “He can’t, as he could in the case of transit, order people back to work and say it’s state law that they can’t strike.”
The MTA is a state agency that runs the LIRR, with its chairman, Thomas Prendergast, appointed by Cuomo. In 1994, when the governor’s father, Mario Cuomo, led New York state, the elder Cuomo used his power over the MTA to get it to accept union demands, ending a LIRR strike after two days in a pivotal election year. Andrew Cuomo could do the same, Henderson said.
The railroad’s 5,400 workers and the MTA have been locked in a dispute since their contract expired in 2010. President Barack Obama has appointed two mediation boards. Both proposed similar recommendations that would raise worker pay by 17 percent over six years.
The MTA countered with a proposal to spread the 17 percent over seven years and require current employees to devote 2 percent of their pay toward health care. New employees would pay 4 percent for health care and, unlike current employees, would contribute to their pensions after 10 years.
The unions balked and negotiations ground to a halt. Cuomo dispatched Prendergast to Washington July 9 to meet the New York congressional delegation. U.S. Representative Charles Rangel, a New York City Democrat, said after the meeting that Congress isn’t an option “at this point in time.”
In an e-mailed statement, Cuomo said his strategy in sending Prendergast was to prove to the unions that they’d get no help from Washington.
“The unions’ false belief that Congress would step in to mandate a settlement was a major impediment to any real progress,” Cuomo said. “It is now clear that the only path to resolution is at the bargaining table.”
Anthony Simon, leader of the biggest group of LIRR workers, said in a July 9 e-mail that Prendergast should never have gone to Congress.
“The solution is in New York and not D.C.,” he said.
Talks between the MTA and the unions resumed yesterday. Prendergast, emerging from a meeting with labor leaders in New York City, said they discussed a counteroffer from the unions.
“We’re all concerned with trying to reach resolution,” Prendergast told reporters. He didn’t provide details on the offer.
Cuomo has a knack for finding leverage, and cash, needed in labor negotiations. In 2011, he threatened to fire almost 10,000 state workers if the two biggest unions representing about 130,000 employees didn’t agree to a three-year wage freeze. After months of negotiations, they agreed. The deals provided the state with $450 million in savings to help close a $10 billion budget gap without raising taxes.
In April, with the state’s finances improving, Cuomo agreed to raise MTA transit workers’ wages by 1 percent in each of the first two years and by 2 percent in each of the following three years. Money for the deal was diverted from the LIRR’s employee pension fund.
He’ll face another round of deal-cutting with the state’s labor unions when their contracts expire in about two years. First, though, he’ll have to beat Republican Rob Astorino, the county executive for Westchester, who’s running for governor in November. A poll last month by Siena College in Loudonville, New York, showed Cuomo ahead of Astorino by 36 percentage points.
If Cuomo can’t avert a strike, it’ll be up to the MTA to have a contingency plan. So far, it’s planning to run shuttle buses to Manhattan and has initiated a public awareness campaign that includes urging commuters to work from home instead.
More needs to be done, Edward Mangano, the Republican executive for Nassau County on Long Island, said at a July 9 briefing for reporters in Mineola.
“We don’t have a comfort level that this will be anything short of disastrous for our citizens,” Mangano said.
To contact the editors responsible for this story: Stephen Merelman at firstname.lastname@example.org Alan Goldstein, Pete Young