Penn Pike negotiates holiday/vacation swap to reduce overtime

Pennsylvania Turnpike Commission has reached an agreement with union officials on a cost-saving measure under which five holidays will in future be treated as vacation days, saving on overtime. The agreement is with Teamster Locals 77 and 250 which represent around 1590 toll collectors, maintenance and other workers.

Union officials have agreed to put the proposal to their membership for a vote. The Turnpike says that without the union give-back on holidays it will be forced to make more drastic reductions in the workforce. Traffic is down about 5 percent as compared to last year.

The Turnpike contract with the union presently provides for 15 holidays per year. Workers working on those holidays get the overtime rate of 1.5 times normal pay for those days. Vacation days are paid at normal pay rates.

Holidays to be eliminated would be Lincoln's Birthday Feb 12, Primary Election Day May 5, Flag Day June 14, Columbus Day Oct 2, General Election Day Nov 3.

The Turnpike estimates the move could save about $1 million/year.

Joe Brimmeier, CEO is quoted in a press statement: "We're extremely pleased with the cooperation between both parties throughout this discussion. The holiday adjustment is a vital part of our cost-cutting plan. As we know, everyone has to give up a little during these tough times. I certainly hope that the membership - who are partners in this endeavor - see fit to support this change which, notably, prevents layoffs in our union bargaining units. We're in this together, and we all have an equal stake in ensuring the long-term viability of the Pennsylvania Turnpike Commission."

The measure is part of an ongoing cost-cutting program, launched last October, to reduce operating expenses system by 10 percent.  Workforce reductions along and a management pay freeze initiated last year have already reduced operating expense more than $12 million for fiscal-year 2008-2009.

70 positions were cut in 2008 via voluntary early retirements, elimination of vacancies and layoffs.

Turnpike traffic fell from June 2008 - due to reduced trucking and less discretionary travel.

in FY2007 the last year for which the Turnpike has reported cars generated $323m in tolls and trucks $270m for tolls of $593m. Including some other operating revenue the total was $608m, just a tad below 2006.

Under operating expenses, cost of services was $370m and depreciation $198m.

If cost of services is to be reduced 10% that's about $37m.

The $12m being saved this year about halfway through the financial year suggests annual savings of $24m, indicating the Commission is about two-thirds of the way to the target savings ($24/$37m).

TOLLROADSnews 2009-04-04