Arbitration Can Be the Key, Despite MTA’s Resistance

Since mid-October, a strike by MTA mechanics has made a fundamental government service -- public transit -- unavailable to 400,000 bus and train riders. Many of these riders are low-income people whose resources are severely strained. So far, there has been too much public posturing on both sides and insufficient focus on a process that can produce a reasonable contract.

Collective bargaining negotiations have broken down. The MTA has insisted that its “final offer” be taken to a vote of the union members. That vote will occur on Friday and is very likely to produce a rejection.

The union has requested that after the vote -- if the plan is rejected -- the dispute be submitted to binding arbitration. The MTA has balked, arguing that it would be wrong for a public agency to “turn over responsibility for negotiating contracts worth hundreds of millions of taxpayer dollars to an arbitrator who is not accountable to taxpayers.”

Arbitration is a well-known procedure -- especially in the public sector -- for labor dispute resolution. States such as Michigan, Wisconsin, New Jersey and Massachusetts use it in various forms. Urban transit systems in cities such as Atlanta, Boston and Washington have also used it.

After a postal strike in the early 1970s, Congress enacted a system of arbitration for future postal labor disputes. Arbitration is employed whenever postal negotiations break down. Where arbitration is required, the parties may well settle prior to the arbitration deadline. In May, for example, the mail handlers union and the Postal Service reached a settlement covering 58,000 workers without going to arbitration. In the 1990s, however, the Postal Service and its various unions did end up in arbitration, and strikes were avoided and mail service continued uninterrupted.

Arbitration is not the end of collective bargaining, nor is it irresponsible for a public agency to use it. The MTA in fact uses arbitration to settle individual worker grievances, as do virtually all unionized employers.

However, the MTA’s prior rejection makes it hard to accept binding arbitration now.

Fortunately, there is a way out of the impasse if both sides will bend and drop the emphasis on the word “binding.” Arbitration could be constructed so that a supermajority of the MTA board could reject any arbitration decision reached. For example, under recent California legislation applying to police and firefighters, local authorities are subject to arbitration if an impasse is reached. But a unanimous vote of the governing authority (such as a city council) can reject the decision. Of course, a supermajority would not require unanimity.

It’s possible that faced with impending arbitration, the union and management negotiators would reach a settlement. If not, we believe that if the MTA and the union accept some version of arbitration, the current dispute will soon be resolved. Arbitrators of public-sector disputes certainly take account of the financial condition of the employer, i.e., the taxpayers’ interest, as well as the workers’ interest.

There are various forms of arbitration. Conventional arbitration permits the arbitrator to compromise between union and management. Final-offer arbitration requires the arbitrator to select one of the two proposals. Arbitration panels can be made up entirely of neutrals or have some union- and management-appointed members.

At this point, the dispute should be about what kind of arbitration to choose, not whether to use arbitration.