AC Transit to Comply with Judge’s Order to Vacate Work Rules

Press Releases
08/03/2010

AC Transit managers have begun the process of complying with a judge’s ruling this week that it must go back to a costly and inefficient union contract.  The action will cost the District $1.2 million dollars in lost savings each month and will ultimately mean the elimination of additional transit service and the loss of union jobs.

The ruling by Alameda County Superior Court Judge Judith Ford invalidated a series of new work rules related to overtime procedures, co-pays for medical care and revised pension plan for future employees. The rules were adopted by the District on June 30 to shave $15.7 million in labor costs.

In effect, the judge’s order forces the District to revert to a now-expired union contract that costs $300, 000 per week more than the adopted work rules.

To comply with the order, operators must be re-assigned to their previous work schedules and numerous internal procedures must be changed with regard to payroll, health and welfare benefits, lunch breaks, overtime and holiday bonuses, part-time work, cost of living adjustments, and more.

The District has until August 10 to make the necessary adjustments and reinstitute the previous contract, under the judge’s order.

Once the expired contract takes hold, the Board of Directors will then face the arduous task of finding some way to recoup the $15.7 million lost with the demise of the new work rules. Cutting bus service is chief among the places where the District will be forced to look.

“We have already made heavy cuts in service, and it is not an area anyone wants to touch again,” said Interim General Manager Mary King. “To do so could decimate our service, but doing nothing could make us insolvent. We have almost no options.”

To reduce costs, the District has already:
• Eliminated more than 70 general and administrative staff positions. In addition, a third of its executive staff has also been eliminated –including the elimination of three executive management staff– the use of district vehicles has been curtailed and management leave benefits have been canceled. Together, that has reduced expenses by $9.2 million. But, as yet, there have been NO layoffs to or concessions from drivers or mechanics.
• Raised fares. Local riders are paying more due to the 25 cents per trip fare increase and $10 increase in the price of a monthly pass. Transbay riders are paying more due to the 50 cents per trip fare increase and $16.50 increase in the price of a monthly pass. Youth, senior and disabled riders are paying more due to the 15 cents per trip local fare increase and 30 cents Transbay increase.
• Cut Service. Riders also had their bus service reduced in March by 7.8% or $10.3 million worth of service hours; they are facing a second round of service cuts in August that will further reduce service by 7.2% or $11.4 million in service hours.
• Reduced Spending. The Board of Directors has cut its salary by 5%, cut travel by 50%, and eliminated a special travel account for transit advocacy.

Even though significant spending reductions have been achieved with these cuts, it is still not enough to balance the budget, given that labor costs account for about 75% of the agency’s operating budget. Without contributions from the ATU members (approximately 84% of the workforce), the budget gap cannot be closed.