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Transit Union and
Laidlaw Transit Services, Inc
Date: May 10, 2005
Citation: 2005 NAC 111
In the Matter of Arbitration
Laidlaw Transit Services, Inc
Case No. 04-A-129
Federal Mediation and Conciliation Service Case
May 10, 2005
This arbitration arises
from a grievance filed by Richard Johnson, Vice President, Amalgamated Transit
Union Local # 1433 on behalf of itself and for all Laidlaw Operators with a
seniority date of hire from February 15, 1999 to December 27, 1999,
hereinafter referred to as the Grievant(s), whose classification is covered by
the terms and conditions of employment of the Labor Agreement (LR), in full
force and effect between Amalgamated Transit Union Local # 1433, hereinafter
referred to as the Union, and Laidlaw Transit
Services Inc, hereinafter referred to as the Company. The subject of
this arbitration is the January 28, 2004 grievance alleging a violation of
Article 40, Section 1, and Operator’s Wage Rates of the Collective
Bargaining Agreement (CBA). The
Grievant alleges that the Company is not paying the proper wage rate for
Operators with a hire date of February 15 to December 27 1999.
This arbitration was heard on March
17, 2005 commencing at 8:45a.m. at the offices of Federal Mediation and
Conciliation Service, 3225 North Central Avenue, Suite 812,
parties, from a list submitted by the Federal Mediation and Conciliation
Service, Case # 04-57344, unanimously selected John F. Wormuth as the
Arbitrator in this arbitration, to render a final and binding award.
The parties agreed that this arbitration was timely and properly before
the Arbitrator and that all procedural requirements had been met.
briefs on behalf of Union and Company were submitted and accepted.
other briefs or submissions were proffered and the Arbitrator requested none.
Prior to testifying, all witnesses were administered an oath or
affirmation by the Arbitrator.
Arbitrator did take detailed notes and used a tape recorder. Prior to the
taking of evidence the parties were informed that the notes and recording of
this arbitration were for the exclusive use of the Arbitrator and would not be
shown to anyone. The record of this arbitration was closed on April 18, 2005,
upon receipt of the closing briefs from both the Union and the Company.
parties were given full opportunity to present evidence, examine and
cross-examine witnesses, produce exhibits and present argument, and availed
themselves of the opportunity to do so. The Union introduced 5 exhibits,
marked Union 1 thru 5, and the Company introduced no exhibits. The parties
introduced two joint exhibits, marked 1 thru 2, and having been admitted into
evidence, were incorporated herein by
BEHALF OF Amalgamated Transit Union Local # 1433
L. Banks, President
Johnson, Vice President
Richard Johnson, Vice President, on behalf of local
# 1433 and affected unit members covered by the Labor Agreement between
the Union and the Company
BEHALF OF Laidlaw Transit Services, Inc.
E. Heston, Esq.
8000 Midlantic Drive,
Mount Laurel, NJ 08054
Peter A. Briggs
National Manager Human Resources
Transit Services, Inc.
South Raritan Street
parties did not submit a joint stipulation of the issue.
Union states that those Operators
hired by Laidlaw Transit Services Inc. in the year 1999 were not maintained
at the top wage rate at the ratification of the Collective Bargaining
Agreement (see Union closing Brief
April 11, 2005)
Company frames the issue thusly:
Laidlaw’s administration of the wage provisions of the CBA, with respect to
fourteen individual employees, violated the contract”
yes, what shall the remedy be?” (Company closing brief April 15, 2005)
Arbitrator frames the issues to be determined thusly:
the Company violate Article 40, Operator’s Wage Rates, of the CBA, by limiting
application of the top wage rate to those Operators hired on or prior to January
1, 1999? If yes, what shall the remedy be? Did the Company violate Article 40,
Operator’s Wage Rates, of the CBA by not applying the top wage rate to all
Operators with a hire date of 1999? If
yes, what shall the remedy be?
11 Grievance Procedure“The
straight-time base hourly wage rate for Operators shall be as follows:
‘Grievance’, as is used in this
Agreement, means a claim by an employee that the terms of this Agreement have
been violated, or that a dispute exists concerning the work rules or proper
application or interpretation of this agreement.”
3, Sub-sections A and B.
3 “No grievance shall be entertained or considered unless it is presented in
writing to the Operations Manager within fifteen (15) days (excluding Saturdays,
Sundays, and holidays) after any controversy arises involving the interpretation
or application of the terms of this agreement, or within seven (7) days
(excluding Saturdays, Sundays and holidays) after the suspension or discharge of
any employee for just cause”.
A. “The Company shall
accept all grievances presented by a Union official in a timely manner.”
B. “The grievance may be accepted by the Operations Manager, or
5 – (In pertinent part)
decision of the impartial arbitrator shall become final and binding on the
parties of this Agreement when delivered to them in writing. The arbitrator
shall have no power to add to, subtract from, ignore or modify any of the terms
of this Agreement.”
40 Operators Wage Rates
the start of the first pay period on or after 7-1-04 and each year thereafter on
each July 1st, the above wage scale will be adjusted in accordance
with the net change in the Western Urban Consumer Price Index for the period
March to March each year with the maximum adjustment being in each respective
year as follows:
each of the above years 2004, 2005, 2006, and 2007 the minimum increase will be
The training rate is established
at $7.00 per hour effective 1-4-04.
Wage rate changes will be
effective on each Operator’s employment anniversary date.
Effective as soon as possible and
subject to ratification on this settlement offer, the Company will pay to each
employee who is on its payroll as of July 1, 2003, a one-time bonus of a net
$300.00, except that employees who will be at top wage rate as of 1-1-04 will be paid a one-time
bonus of a net $400.00. Employees hired after July 1, 2003 will receive a
one-time net bonus of $200.00. In all cases to be eligible to receive the bonus,
the employee must be currently employed as of the date of payment.”
41 Additional Agreements
provision or term of this agreement may be amended, modified, changed, altered,
and waived. Nor shall any condition be imposed on any provision of this contract
except by written documentation, and ratified by the membership of the Union and
signed by the parties hereto.”
of the provisions of this contract may be re-negotiated at anytime if mutually
agreed upon by both parties”. (JT.
The Company contracts to provide
transportation service in the Phoenix Metropolitan region. On May 28, 2003, the
parties entered into negotiations to arrive at a successor Labor Agreement.
These negotiations progressed for several months and resulted in the tentative
agreement of October 30, 2003. ATU Local #1433 membership, in balloting
conducted on November 5, and 6, 2003, rejected the proposed tentative agreement
because a seven-step salary schedule would result in lack of satisfactory progression on the wage scale.
Negotiations were resumed with the primary focus being the Union’s
rejection of a seven-step wage scale. As
a result of negotiations, the Company
modified its proposal to establish a seven-step wage scale and agreed to
a six-step wage scale. In addition, the Company would pay a bonus to all
bargaining unit members, employed as of July 1, 2003. The December 12, 2003
tentative agreement was submitted to the Union membership for ratification and
it was subsequently ratified on December 18, 2003.
integral part of the December 12, 2003 agreement is the establishment of
one-time net bonus. The amount of the bonus an individual bargaining unit member
is eligible to receive is contingent on one’s hire date on or before July 1,
2003. If before July 1, 2003, the net amount of the bonus is three hundred
dollars ($300.00). If hired after
July 1, 2003 the net amount of two hundred ($200.00) is to be paid. The parties
negotiated an exception to the July 1, 2003 eligibility date to accommodate
those bargaining unit members who reached the top straight-time hourly wage rate
of $15.03 per hour, in effect on January 1, 2004. Those individuals would be
paid a net one-time bonus of four hundred dollars ($400.00), but limited to
those Operators with a hire date prior to, or on December 27, 1999. At the
hearing, both the Union and the Company stipulated, that the bonus payment is
not in controversy and it has been paid in
accordance with the terms of the Labor Agreement.
The substantive issue of the instant arbitration is whether or not the
Company is contractually bound to pay all of those Operators who were at the top
wage rate of $15.03 pr/ hr on January 1, 2004, the top wage rate of $16.00 pr/hr
that went into effect on January 4, 2004.
OF ATU LOCAL # 1433
BEHALF OF ITSELF AND ALL LAIDLAW OPERATORS WITH A SENIORITY DATE OF HIRE JANUARY
1, 1999 THROUGH DECEMBER 31, 1999
Union argues that the Company did not move all eligible Operators to the top
step of the newly negotiated straight-time base hourly wage scale. Prior to the
new wage rates that went into effect on January 4, 2004, the top straight-time
hourly wage rate was $ 15.03 per hr. The
Union contends those bargaining unit members who were compensated at the top
straight-time hourly wage rate prior to January 4, 2004 are to be paid the
negotiated top wage rate of $16.00 per hr. Those individual Operators are
identified by their hire date which corresponds to slots one (1) thru
thirty-seven (37). (U.EX. 5).
the Company implemented the negotiated wage increase for Operators ranked in
slots one thru thirty-seven, the Company failed to apply the proper wage
increase to Operators in slots twenty-five (25) thru thirty-seven (37). Rather
than placing all Operators in slots one thru thirty-seven at the top wage rate
of $16.00 per hr as of January 4, 2004, the Company placed only those Operators
in slots one (1) thru twenty-four (24). In order for the Company to be in
compliance with the terms and conditions of the Labor Agreement all Operators in
slots one (1) thru thirty-seven (37) must be paid at the top straight-time base
hourly wage rate of $16.00 per hr. Assignment of any wage rate other than $16.00
per hr to Operators in slots one (1) thru thirty-seven (37) is a
violation of the intent of the Labor Agreement. In the past all Operators
at the top straight-time hourly wage rate have been compensated at the same
hourly wage rate. It was never the intent of, nor was it the bargaining strategy
of the Union to create a bifurcated wage rate for Operators who have a hire date
on or before December 27, 1999.
remedy sought by the Union is for all Operators with a hire date of February 15,
1999 thru December 27, 1999, be placed on the top straight-time hourly wage,
retroactive to January 4, 2004.
OF LAIDLAW TRANSIT SERVICES, INC.
Company argues that at all times it has complied with the terms and conditions
of the Labor Agreement, and has administered the wage scale as required.
Article 40 of the Labor Agreement specifies the hourly rate to be paid,
and the required years of service needed in order to advance and progress thru
the six step schedule. Step advancement on the six-step schedule is a function
of the individual’s employment anniversary date. In the instant matter, the
Company agreed to advance Operators in hire slots one (1) thru twenty-four (24)
to the top straight time rate effective January 4, 2004. Those Operators that
received the top straight-time wage rate had hire dates of July 6, 1987 thru
January 4, 1999. Because the new wage rates became effective on January 4, 2004,
it excluded bargaining unit members who did not have an employment anniversary
date on or prior to the effective date of the new wage scale.
the exception of Operators in hire slots one (1) thru twenty-four (24), an
individual’s progression on the salary schedule is dependent on one’s
employment anniversary date. The Labor Agreement was never amended or modified
to dispense with this requirement. Therefore, Operators with a hire date after
January 4, 2004, will progress through the salary steps based on their
employment anniversary dates.
language of Article 40, Operators Wage Rates, is clear and suffers no
ambiguities. In consideration of this matter the arbitrator should give ordinary
meaning to the language the parties negotiated. The Company followed and
complied with the plain language and meaning of the Labor Agreement and did so
in its administration of Article 40 Operators Wage Rates.
There is no contractual obligation to advance Operators hired
on or after January 5, 2004 to the top straight-time wage rate in effect
on January 4, 2004 since at that time these Operators had not completed the
required 5 years service.
Company requests denial of the grievance in its entirety.
Company and the Union engaged in bargaining to arrive at a Successor Labor
Agreement and did so on or about December 12, 2003. At the hearing, both the
Union and Company offered testimony that
a major focus of their bargaining discussions revolved around the issue of
progression on the wage scale. The parties exchanged various proposals and
continued to do so after the Union membership rejected the tentative agreement
of October 30, 2003. When the Union membership declined to ratify the tentative
agreement, the Union bargaining committee advised the Company of the reasons for
the rejection and shortly thereafter negotiations resumed. During the renewed
negotiations the Union’s bargaining committees explained
that the reason for
the rejection was the membership displeasure with wage scale progression. Faced
with the Union membership’s clear expression as to why it rejected the
proposed agreement, the
parties’ respective negotiating committees renewed their efforts to find an acceptable solution. Each side approached potential
resolution of the wage progression issue from different perspectives; however,
there was mutual recognition that a successful resolution of this issue was a
critical element to the Union’s membership acceptance and ratification of a
Successor Labor Agreement. The negotiations were successful and a new tentative
agreement was ratified on December 18, 2003.
analysis of Union Ex’s 1, 2 3 and the final agreed contract language
of Article 40, Operators Wage Scale (JT. EX 1) is necessary to understand
the distinct interpretation of the Article held by the Union and the
constitutes the underlying essence
of this grievance.
Unit member’s progression on the wage scale is addressed in the Phoenix
Company Economic Proposal Co-E 2 of October 9, 2003 (U. EX. 1). In this
proposal, a seven-step straight-time base hourly wage rate with an effective
date of July 1, 2003 is advanced. Each successor increase is effective on or
after the first pay period on
July 1st of each succeeding contact year, with the final adjustment on July 1,
2007. Vertical movement on the proposed seven-step wage scale is dependent upon
an individual Operator’s employment anniversary date.
Johnson, Vice-President of ATU Local 1433, testified that a major objective of
the Union’s bargaining strategy was to improve the rate of progression on the
wage scale, and evidence of this was found in (U.EX.1) In particular, the
proposal provided for current employees who were presently at the 3rd
step of the straight-time base hourly wage rate to skip the 4th step
and directly advance to the 5th step. Similarly situated Operators
who were at the 4th
step of the wage scale would skip the 5th step and be placed on the 6th
step. However, it is the individual
bargaining unit member’s employment anniversary date that is determinative of
the exact date at which an individual would skip a step and move vertically on
the wage scale. In the framework of Article 40, Operators Wage Rates, the
parties preserved the tenet that vertical movement on the wage scale is a
function of the individual’s anniversary employment date.
Offer for Settlement, of October 30, 2003,
(U. EX2) modified the anniversary employment date requirement to skip
from the 3rd to the 5th step and from the 4th
to the 6th step, on the straight-time base hourly wage scale.
It appears the anniversary employment date used to determine eligibility
to skip a step was replaced and substituted by a fixed hire date of before July
1, 2003. Utilization of the fixed date of July 1, 2003, when applied to the hire
date roster (U. EX 5), provided eligibility to skip a step to Operators with a
hire date prior to June 26, 2003. The
remainder of the proposal preserved vertical movement to an Operator’s
anniversary employment date. Further, the proposed tentative agreement carried
forward the Company’s proposal for a seven-step wage scale. This tentative
agreement was rejected by the Union’s membership.
Offer For Settlement, of December 12, 2003, (U EX. 3), was ratified by the Union
membership on or about December 18, 2003. Undisputed testimony presented
indicated that the parties paid particular attention to crafting an agreement to
deal with the issue of wage scale progression.
Briggs, National Human Resource Manager, testified that during these
negotiations he conveyed the Company’s concern to limit the economic impact of
any revised agreement. These financial limitations were communicated to the
Union and both parties continued to work toward a mutually acceptable agreement.
The final agreement incorporated wage increases with an initial
implementation date of January 4, 2004. This date was deliberately chosen to
limit the number of Operators at the top wage rate who would be immediately
eligible to advance to the new rate of $16.00 pr hr. The January 4, 2004
effective date was chosen with purpose because it reduced the immediate
financial impact of the agreement on the Company. Vertical movement on
the Operator’s Wage Scale for those not eligible for immediate advancement
would occur on their employment anniversary dates.
who testified on behalf of the Union and Company did so truthfully and without
reservations. This award does not turn on the issue of creditability even though
some of the testimony offered was diametrically opposed. This opposition in
testimony stems from individuals who subscribe to differing interpretations of
the Article and hold enhanced expectations of what Article 40 is to achieve.
40 does not suffer from a lack of clarity. Therefore, its language and wage
scale chart is to be given its plain meaning. The history of the bargaining
illustrates the ability and skill of the negotiators to establish different
effective dates for various economic improvements. Movement of these effective
dates significantly apportions the economic offer. Article 40 in its final adopted forum has specific
effective dates governing vertical movement that are independent of the fixed
general wage increases. The wage scale chart has clearly established calendar
dates regulating eligibility for vertical movement and the general wage
increases. The agreement provides
for the general wage rates to be effective on January 4, 2004, but does not
modify or alter the years of service required to advance vertically on the
scale. Simply stated, vertical movement is dependent on years of service an
employee had with the Company on January 4, 2004. This, in turn, is
determinative of the employee’s placement on the wage scale. Operators whose
employment hire date did not qualify them for vertical advancement on January 4,
2004, would advance to the next step on their employment anniversary date. The
evidence indicates the parties went to great care to preserve the concept of
vertical movement on the wage scale effective on an employee’s anniversary
date. Had the parties desired to
negotiate different effective dates for wage increases and vertical step
movement, they certainly could have done so.
the payment and amount of the bonus is not in dispute, the parties’
allocation of it is an example of the parties’ ability to utilize
different effective dates in a multi-phased economic package.
The amount of the one-time bonus is contingent on an individual
Operator’s hire date. The amount to be paid
has three distinct elements which are the proximity of an individual’s
hire date being prior to, or after July 1, 2003, and if the Operator was at the
top wage rate in effect on January 1, 2004.
the bargaining committees intended to extend the top wage rate of $16.00 pr hr
to all Operators who had an employment date of 1999, they could have
accomplished it by establishing the effective date of the general
wage increase at January 1,
2004, rather than January 4, 2004. It is apparent that
through the negotiating processes the parties separated the effective
dates of the general wage increase from the January 1, 2004, effective date of
the bonus. With the establishment of the general wage increase effective
January 4, 2004, an Operator must have completed five years of service to
move to the top wage rate of $16.00 per hr.
FINDINGS AND CONCLUSIONS
The Company did not violate Article 40, Operator Wage Rates, when it did
not apply the top wage rate to Operators hired on or after February 15, 1999.
The Company did not violate Article 40, Operators Wage Scale, when it did
not, on January 4, 2004, apply the top wage of
$16.00 per hr to Operators with a hire date of February 15, thru December
27, 1999. The Operators in question are identified in
(U EX 5) by rankings
thru thirty seven (37).
The Company properly administered the salary schedule by advancing Operators who
had been five years in service to
the top step on January 4, 2004 , and advancing those who did not have five
years of service to the next step
on the schedule based on their respective employment anniversary dates.
The grievance is denied.
John F. Wormuth
May 10, 2005
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