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After reforms, big savings in new T contract

Passengers entered the Red Line at South Station.
Passengers entered the Red Line at South Station. Boston Globe File Photo

The Legislature’s decision last year to allow the MBTA to contract out services paid off big time on Monday, when the state and the T’s biggest union reached a deal that probably would have been impossible without those reforms. Decisions by Governor Charlie Baker, state House Speaker Robert DeLeo, and Senate President Stan Rosenberg, directly resulted in savings for taxpayers that should allow the region’s buses and subways to operate more efficiently.

Just imagine what might happen if other agencies had the same latitude Beacon Hill so wisely gave the T.

In a four-year deal with Carmen’s Union Local 589, the state estimates it will save about $81 million that can be reinvested in the system. It gets there by curbing overtime, postponing a scheduled raise, and starting new drivers at lower wages. The T will also adopt an electronic scheduling system, replacing the paper system now in use. In exchange, the T promised not to outsource most jobs at the agency.

That powerful piece of negotiating leverage didn’t exist before, because the state’s so-called Pacheco law made it extremely difficult for state agencies to outsource work. But after the T’s disastrous performance in the winter of 2014-15, the Legislature, at Baker’s urging, gave the agency a three-year exemption from the rule in the same legislation setting up the T’s new oversight board.


Since then, the agency has made modest use of its outsourcing authority, moving to outsource its cash-counting operations and warehouse. The bigger impact, though, has been restoring the balance around the labor negotiating table.

“The issue of the MBTA was not privatization as an ideological matter, but productivity,” Transportation Secretary Stephanie Pollack said. “We needed to have productivity, either from our workers or the private sector.” According to the state, some of the T’s work rules had been in place since 1913.


The union comes out with raises and job security guarantees, which should put to rest the notion that the T was pursuing privatization at all costs. The union could have avoided talks — the old contract isn’t up yet — but, with the looming threat of outsourcing, chose not to.

The successful negotiation should raise a question: Why go back to the old system? The T’s Pacheco exemption expires in less than two years, but the Legislature could choose to extend it. By tying management’s hands so tightly, the Pacheco law practically invites waste. Privatization is not a panacea — and the T has been appropriately judicious about using it — but leaving the possibility on the table gives officials the leverage to get a better deal for the public.