Rail union leaders cheered. New Jersey Gov. Chris Christie smiled. And hundreds of thousands of New Jerseyans were assured of a routine rail commute to work Monday without an immediate fare hike.
The dispute revolves around a 5-year-old contract stalemate. Unions have demanded a deal similar to the one signed in 2014 by the Long Island Railroad, with an 18-percent pay raise over seven years plus retroactive pay from 2011, when the current contract came up for negotiation. The unions also want a modest increase in employees' health insurance payments, capped at 2.5 percent of their base salaries.
NJ Transit told the Presidential Emergency Board, which has been mediating the latest discussions, that such a plan would cost the agency an additional $183 million by 2018. In a Feb. 19 letter to New Jersey's Congressional delegation, NJ Transit said the union proposal was "excessive," and included "platinum-level health benefits."
After five years of negotiations, NJ Transit and its train workers reached a tentative agreement Friday evening, 30 hours before a possible strike that threatened to cripple the region's transportation networks and economy.
Important facts initially remained confidential: Christie and union leaders refused to disclose any details of the contract, including how much workers won in salary raises, how much they'll have to pay toward their own health insurance benefits, or how much money the entire package will cost. Also unknown is whether the deal is final; union members still must vote to ratify it.
The only detail Christie did disclose is that if ratified as proposed, the contract will last through the end of 2019, longer than either side had originally proposed.
Two other important aspects were known Friday night: The agreement, reached in Newark, staved off a strike, and it did so without necessitating a major fare increase, which many commuters and transportation advocates had feared.
"There is no immediate fare hike that's needed to pay for what we've done in this contract," said Christie, who added that he will not seek a fare hike for NJ Transit through at least July 31, 2017.
The announcement of a deal came after a week of rising tensions, in which each side occasionally accused the other of being unreasonable. On Tuesday, NJ Transit issued a statement saying the agency had offered major concessions, especially on workers' health insurance costs, and blamed the breakdown of talks on the unions' recalcitrance. Two days later, Stephen Burkert, general chairman of the United Transportation Union Local 60, issued a statement decrying "NJ Transit's unreasonable position and unwillingness to reach an amiable solution."
But Friday opened on a brighter note: Gary Dellaverson, the lead negotiator for NJ Transit, appeared at the Hilton Hotel in downtown Newark at 10 a.m. for the start of talks and said he believed a compromise was likely.
"This is the day it should happen," he said. "We know what the differences are, so it's now time to close those differences."
The combination of a longer-than-expected contract that gives workers a raise without necessitating a fare hike was a major success, Christie said.
"It's good news on many levels," Christie said at a media conference Friday evening at NJ Transit headquarters. "This agreement is going to give workers and commuters a measure of certainty and stability."
The agreement is pending a vote from members of the 11 unions that represent NJ Transit's 4,200 workers.
The agency had previously proposed a seven-year deal with a 10-percent pay raise but including a significant increase in workers' contributions toward health insurance costs. The unions had requested an 18.4-percent raise over seven years, plus back pay to 2011, when the current contract came up for negotiation, plus a cap on health insurance costs equaling 2.5 percent of workers' base pay.
Negotiations had dragged out over five years, ever since the contract came up for negotiation in 2011. The process was dictated by the federal Railway Labor Act of 1926, which is designed to increase pressure on both unions and management to reach an agreement without resorting to a train shutdown.
"This process is much different than any other union negotiation I've dealt with as governor," Christie said.
Following the terms of the law, last year the National Mediation Board released both sides from negotiations, saying they remained so far apart that further meetings were unlikely to produce a deal. That decision started a 270-day clock that involved negotiations before two Presidential Emergency Boards, followed by cooling-off periods. If the sides still couldn't agree, the mediation board set 12:01 a.m. Sunday as the first possible time when NJ Transit could lock workers off its rail properties, or the unions could strike.
Both presidential boards found the demands from the unions more reasonable than NJ Transit's offers. That decision also was rooted in the labor act, which places a high value on precedents set by previous railroad contracts. With this in mind, the unions based their demands on the contract won by Long Island Railroad workers in 2014, Burkert said. For months, NJ Transit balked at those demands, calling them unreasonably expensive.
The agreement announced Friday also avoids a potentially messy chain of decisions by NJ Transit, the unions and Congress. At any time before or after the midnight Saturday deadline, Congress had the power to step in and impose any conditions its members chose. It could have imposed a contract consistent with the decisions of the presidential boards, written a new contract or ordered the employees back to work without a new contract.
The agreement also makes life much easier for NJ Transit. The agency had announced that in order to be ready for a full shutdown early Sunday morning, workers would need to prepare by closing different sections of the rail network beginning on Friday.
The timing of a service resumption also was up to question. If the trains stopped rolling for a short time, between a few hours to a day or two, NJ Transit said it could turn the fleet back on within 24 to 36 hours. But if the shutdown dragged on, the amount of inspections required by federal regulators would have piled up, and full service resumption may have taken up to four days.
The first word that an agreement had been reached came at around 7 p.m., when union leaders gathered around a podium in the lobby of the Newark Hilton. They leaders cheered as they announced the deal.
"You can all smile now," said Burkert. "We have reached an agreement."
(c)2016 The Record (Hackensack, N.J.)
