NEW YORK — To most New Yorkers, yesterday’s labor agreement represented little more than a crisis averted and the promise of being able to commute without a bike, ferry or sturdy pair of running shoes. But in truth, the implications of the deal reached yesterday evening go far beyond the subways, its thousands of workers and 7.2 million daily riders, the New York Times reported.
The agreement will help the city and state confront a vast array of challenges over the next year, ranging from contract negotiations with other state and municipal unions, a statewide attempt to contain health care costs and the painful chore of closing huge state and city budget gaps in tandem.
At first glance, Mayor Michael R. Bloomberg appears to have emerged as the most obvious winner. His city avoided a costly and crippling strike in the middle of the Christmas season, and yesterday’s deal may establish a precedent concerning one of the city’s most coveted goals: raises for its unionized work force only in exchange for productivity gains, a bargaining goal that has eluded the city for nearly a decade.
Further, the mayor managed to keep just enough distance from a messy fight, while maintaining a steady drumbeat of legal and other threats toward union leaders considering a strike.
For Gov. George E. Pataki, the outcome presents a potential conundrum. He promised not to raise taxes, yet he also emerged from his last election with debts to many unions. The deal giving transit workers wage increases — and a one-year sum to soften a wage freeze — could place the governor in a difficult spot as he tries to satisfy the wage demands of 130,000 state workers in upcoming contract negotiations.
On the union side, Roger Toussaint, president of Local 100, returns to members with a less generous deal than the one he criticized three years ago, which resulted in the ouster of his predecessor, Willie James. But union leaders and labor experts said yesterday that times are much different and they believed that he would be able to sell the deal to his members. “He could take some heat on his far left flank,” said David Gregory, a professor of labor law at St. John’s University Law School, adding: “But I think he’s got a lot of credibility with his troops, and I think he can put enough of a positive gloss on this to get by. He can make a case that a zero is not really a zero.”
Some union leaders also said that they did not think the wage freeze in the first year, accompanied by a one-time payment to workers, set a necessarily gloomy precedent.
“I think that the expectations we had from this were not as high as they once might have been, but we wanted at least to see fairness and that’s what we’ve seen,” said Arthur Cheliotes, president of the Communications Workers Local 1180, which represents city middle managers.
“But I think this says that if we’re all going to share in some pain in this crisis, then maybe the city and the state should also say that there are some taxes we could afford to cut earlier that we cannot afford to do without now,” Mr. Cheliotes said.
Although Mr. Bloomberg has been speaking candidly for months about the city’s fiscal crisis and Governor Pataki has sounded his own gloomy notes in recent weeks, the possibility of a transit strike gave New Yorkers appreciable proof that these troubled times might leave no one untouched.
“I think without question the message here is that the fiscal crisis is real and the impacts of not having money to adequately pay workers is going to be a constant,” said Douglas Muzzio, a professor at the School of Public Affairs at Baruch College. “As we get into negotiating with city unions, particularly with the public safety and public health workers, it will be a constant reminder.”
Looking ahead to those negotiations, there is much from yesterday’s agreement that will cheer the city and state. Both have been longing for changes in work rules and for productivity enhancements in exchange for pay increases as they negotiate contracts. There have not been broad work rule changes in municipal contracts since the 1980’s, when the sanitation workers agreed to reduce the number of men on trucks from three to two. Mr. Bloomberg also wants to see the common practice of settling contracts retroactively come to an end.
“What certainly will carry through is that if you don’t have productivity enhancements, you’re not going to be able to get any raises,” Mr. Bloomberg said last night as he left City Hall. “And what that really means, in terms of negotiating strategy, is the old practice of waiting until the contract expired after a couple of years, and then negotiating retroactively, just is not going to work. Because the moneys that we are going to have to come up with for any raises will be through productivity enhancements, which you can’t do retroactively.”
But for Governor Pataki, the transit settlement might not mean quite as much. The governor was able to distance himself from the negotiations, calling on the union to deal only with the M.T.A. and vowing never to become involved in labor talks. But Mr. Pataki, who owes much to organized labor from his last campaign, might not be as lucky in maintaining his distance this spring.
The mood among state union leaders is not one of compromise. Danny Donohue, the leader of the largest of the state employee unions, the Civil Service Employees Association, warned that his members would consider a proposal of a wage freeze as a sign of bad faith.
Mr. Donohue said he believed any concessions from labor must be balanced by sacrifices from business and the wealthy. He said the governor should consider postponing planned corporate tax cuts, cutting the cost of drug subsidies and raising taxes of people who make more than $100,000 and corporations.
“We are not about to let public employees be the cannon fodder for a war that might come out of this because of budget issues,” he said.