Editor’s note: This article has been updated with news of the contract agreement.
SEPTA has reached a tentative two-year contract agreement with the Transportation Workers Union, Local 234, following a weekend intervention by Gov. Josh Shapiro.
The agreement prevents a strike that the union has been talking about “inevitably” on Friday as negotiations on pensions and health care contributions have reached an impasse.
On Sunday, the governor’s employees joined the talks, and the 5,000-member union agreed to postpone the strike. Shapiro “played a key role” in preventing the strike, TWU President Will Vera said.
SEPTA has experienced numerous work stoppages throughout its history. However, in recent years, threats of strikes have been more common than strikes themselves.
Here’s the lead-up to today’s agreement and the history of labor conflicts at the transit agency.
Why did the union threaten to strike?
TWU typically signs a up-to-date contract with SEPTA every two years. But over the past few years, as the agency faced potentially severe service cuts due to a structural budget deficit, it signed a series of annual contracts instead.
The last contract expired on November 7, and on November 16, TWU members voted to authorize a strike.
Points of contention included SEPTA’s demand that union members pay more for health insurance, TWU’s demands for an boost in retirement benefits and changes to ailing leave and dental and vision benefits for up-to-date employees, Inquirer reported.
On Friday, TWU International President John Samuelsen accused SEPTA not taking contract negotiations seriously. “SEPTA is attacking our health benefits; they are attacking our retirement security,” he said, declaring a strike “imminent.”
SEPTA maintained that it was negotiating in good faith, but officials were reportedly concerned about the costs of the proposed pension boost and other demands.
What effects could a strike have had?
The strike could have caused major disruptions to services, suspending the operation of city buses and trolleybuses, as well as the Market-Frankford and Broad Street lines. Regional rail, suburban transport, LUCY and CCT Connect services will not be affected.
Philadelphia Schools Superintendent Tony Watlington sent a letter to district families on Sunday saying the strike would affect nearly 51,000 students and warning that the district cannot intervene to provide transportation, in part because of a continuing driver shortage across the country.
He said students who were overdue or absent due to “SEPTA-related travel challenges” would not be charged a overdue grade or would be excused if a parent or guardian sent the note. Employees will also be excused for tardiness.
If a strike has “dramatically impacted” student or staff attendance at a school, the school may be advised to switch to virtual learning, Watlington said. He advised parents to make sure their children’s Chromebooks are working and advised them to continue checking district strike blog and social media posts.
How did this relate to SEPTA’s budget problems?
It is unclear how the agency’s long-term financial challenges contributed to the impasse.
A year ago, when SEPTA last agreed to an boost in employee pay and retirement benefits, then-COO (now CEO) Scott Sauer said the move would have no major impact, either positive or negative, on the authority’s plans to deal with the coming budget crisis.
SEPTA has an annual structural deficit of $213 million, due in part to rising labor costs as well as higher expenses for fuel, energy, equipment and other needs. There are other factors as well, such as withering passenger numbers since the pandemic and the end of federal humanitarian aid. Its annual budget is $2.6 billion.
The agency has a backlog of capital needs, such as up-to-date vehicles and station upgrades, that officials say amount to more than $10 billion. It also spends tens of millions of dollars to address a range of safety challenges and federal mandates, most recently to modernize 50-year-old fire-prone regional rail cars.
Republican state lawmakers have repeatedly rejected Shapiro’s proposals to permanently boost transit funding. The funding gap prompted SEPTA to significantly boost ticket prices and temporarily eliminate some routes in August, as well as plan more severe cuts, including closing several regional rail lines.
The dispute contributed to this four-month deadlock in the state budget. It ended without more money being allocated for transit, but Shapiro directed PennDOT to make SEPTA available transfer $394 million from its capital funds to finance operations over the next two years.
With the structural budget temporarily patched, SEPTA appears to have sufficient funds to cover projected labor costs.
According to some transportation advocates, SEPTA is a relatively productive organization – i.e operating costs per trip are lower than many other immense public transport agencies – which could support arguments that it is stingy in various areas, including staff pay and equipment. Some critics question the validity these calculations.
Have SEPTA workers gone on strike yet?
SEPTA has been called the most strike-prone transportation authority in the country. Since its creation in 1963 from a collection of elderly transportation systems, it has seen 12 strikes, starting with a nine-day strike in 1971.
This was followed by an 11-day strike in 1975 and a 44-day work stoppage in 1977, the longest in history. Mayor Frank Rizzo refused to provide further funding, public sentiment turned against the workers, and the TWU ultimately accepted a worse contract than the original offer. The strike led to a sustained 10% decline in passenger numbers.
For the next four decades, strikes occurred every few years. In 1998, there was a 40-day strike over SEPTA’s demand to change regulations regarding part-time workers, drug testing and other issues.
However, strikes have been relatively sporadic in the 21st century, with only three occurring so far. The last one was a six-day work break in November 2016, just before the presidential elections. As was the case this year, pension increases were one of the biggest issues, along with union demands for toilet breaks and changes to address operator fatigue.
Fearing disruptions in voting, the campaigns of Hillary Clinton and other candidates sought an emergency order to force transit workers back to work, but the strike ended the day before the election.
TWU members voted to authorize strikes 2023 and 2024, during hard contract negotiations, but an agreement was ultimately reached without a strike.
