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news & views November 9, 2009
Is it coincidence or strategy that ATU began its strike two months before Christmas and just over three months before the Olympics? There is considerable irony in the situation. Before TransLink selected MVT for all three areas, ATU attacked the non-profit agencies which had entered bids and welcomed MVT with open arms, expressing confidence that it would better the lot of drivers. After MVT took over the operations it the beginning of 2009, the troubles began and ATU's position changed. By November 5, 2009, News 1130 reported Tyler Felbel of ATU as saying TransLink must take its share of the blame as well. "They're the ones that took the contracts away from mostly non-profit societies that were operating it, and gave the contract for the whole region to this large American for-profit company." MVT made many changes to HandyDART operations that provoked bitter complaints from ATU and its members. Among the most contentious were the installation of GPS tracking units and video cameras on the buses. Negotiations have been tough and at times vitriolic with each side levelling accusations and counter-accusations at the other. However, one completely predictable issue remains at the heart of the present labour dispute: wage rates. The holy grail of HandyDART unions and particularly of ATU has been wage parity with transit bus drivers. HandyDART drivers have traditionally been paid several dollars per hour less. Previous efforts to achieve this goal were stymied by the multiple contracts and fragmented union representation. TransLink benefited from the contract system by maintaining cost containment. The public benefited by having any operating surpluses put back into community services by the non-profit agency contractors. Wages remain a major stumbling block. At the end of August, an MVT Negotiations Update sent to its employees stated that ATU's proposal would cost approximately $6.5 million per year more than MVT's proposal. It is almost certain that MVT's contract with TransLink cannot pay for anything near what ATU is determined to extract. ATU may have had an excellent strategy at the time it was hatched. If MVT stood up to their pressure, TransLink would surely cave and fund the increases necessary to get the HandyDART system back to work. However, two unforseen developments are working to keep TransLink out of the dispute. The first is the recession following the financial crisis. The second is the recent scrutiny and criticism of TransLink's costs and financial management [click here]. In the face of its projected operating deficits and the political climate, TransLink does not and will not have the money fund the ATU's ambitions. A long and bitter strike is now a reality. «» February 26, 2009 It is no surprise that the transition at the start of this year did not go smoothly. MVT gave the impression that it underestimated the complexity of the task and was scrambling at the last minute on things that could and should have been done much earlier. There have also been a number of issues raise by ATU and the union over the transition and changes introduced by MVT. MVT’s hiring process initially included a criminal record check to be carried out by the American parent. MVT backed down and agreed to have them done in Canada. Drug testing was also called for with loud opposition from ATU and drivers. This issue may not yet be resolved. Employees have complained that MVT’s new uniforms lack weather protection and adequate reflective safety markings. The payroll for at least January was botched and many employees did not receive all their pay. One of the most contentious issues is MVT’s installation of video cameras and gps tracking modules in all buses. This caused a storm of protest by employees and more issues in bargaining. In addition to the proliferation of bargaining issues, ATU has filed grievances regarding some issues, accusing MVT of violating the current collective agreement. At the same time, bargaining for the replacement contract appears to be going nowhere. ATU members have been complaining about the lack of communication by their ATU about the status of negotiations and the issues on the table. It seems that MVT seriously underestimated both the complexity and cost of reconciling the different collective agreements and merging them into one. The bargaining process and the relationship between MVT and ATU appear to be rapidly deteriorating. After a particularly sharp exchange of views that was posted on the handydart.org blog, that site was closed and then went offline altogether. It has not re-appeared. The posting included a letter dated February 8, 2009 from ATU accusing MVT of an ambush and attempting to interfere in the union’s relationship with its members. A long and bitter strike seems inevitable. This situation is unfolding while it has emerged that the MVT bid was the most expensive of all bids for all three contracts. This is particularly interesting in light of TransLink’s forecast of a $103 million operating deficit for 2009. The repercussions of TransLink's decision on the former contractors continues. In addition to the one time costs of winding up operations, the non-profit agency contractors have lost a revenue stream that supported community services, many of which assisted handyDART clients. One example was reported by Peace Arch News. Semiahmoo House Society reported it lost $380.000 in revenue and has had to institute or increase the cost of its programs and services [click here for article]. The result, it states, is reduced registrations and family distress:
That is the loss of revenue to just one of several non-profit community agencies that held HandyDART contracts for years. The consequences for those who need the community services is far reaching and severe. The revenue that supported those community services will instead go to MVT's American parent company as profits. The award of this contract to MVT continues to be a bad decision made the wrong way at an inopportune time. The public, including some of its most vulnerable members, are paying dearly for TransLink’s failure to put this contract to public tender, and the cost of that mistake is spiralling upward. «» October 21, 2008 Since MVT was selected, the American and global financial crisis has hit, credit availability has dried up and the Canadian Dollar has plunged from near parity with the American dollar to just over $0.80. For an American company undertaking a first operation in Canada, this must be a major financial blow and make it even more difficult to meet the price it bid for the three contracts (now combined into one). It also would significantly reduce the value of any profit margin to the American parent company. Surely this would make the unions' demands for levelling up to the high The three unions did not accept MVT's position. However, in what CAW describes as "a marathon bargaining session" on October 16, 2008, the unions claim to have reached the following agreements:
It seems unlikely that MVT would have been prepared and able to pay these wages under its bid. But this is not a collective agreement; it becomes the starting point for collective bargaining in the new year. «» October 9, 2008
A more complete analysis of this development will follow. «» October 7, 2008
Scott Schell is the MVT manager that has been integrally involved in MVT's preparation for taking over the handyDART operation. There are indications that Schell will be one of two managers who will run MVT's Metro Vancouver operation. October 7, 2008 «» October 2, 2008 - Interviews and Editorial handyDART info has interviewed the heads of three current handyDART contractors who submitted proposals that were discarded by TransLink management. OPTIONS: Services to Communities Society (Options) bid on the South of Fraser contract in collaboration with the Deltassist Society. Semiahmoo House Society (Semiahmoo) also bid on the South of Fraser contract under the name South Fraser Custom Transit Association. Greater Vancouver Community Services Society (GVCSS) submitted a bid on the North of Fraser contract under the name Crosstown Accessible Transit. Pacific Transit Cooperative is the other current contractor in the North of Fraser who entered a bid, but handyDART info was unable to contact a senior representative. The interviews of Options, Semiahmoo and GVCSS revealed that they have many views in common. None of them was aware at any time before the deadline for submission of proposals that TransLink favoured a single contractor for all three areas who would essentially consolidate them into one integrated operation. All spent substantial, precious funds and other resources on preparation of their bids. All of them have been handyDART contractors through many contract cycles under the old area structure and all were very surprised and disappointed by the choice of preferred candidate by TransLink management. Two of the three prepared and submitted their bids under the strong impression that there would be three contractors and most likely three different contractors, one in each of the three areas. The same two stated emphatically that they would have submitted bids on all three areas either individually or jointly under a single joint entity had they known of TransLink's preference for such bids. The third stated that it would not have gone to the expence of preparing a bid at all unless it had been a joint bid with other current contractors. Two of the three stated emphatically that they felt they had been mislead by TransLink. One claimed to have been encouraged to bid only on one contract area. Both strongly felt that the process had been unfair. All three expressed dismay and frustration with the concept of profits flowing into the pockets of corporate owners in California. In the South of Fraser and North of Fraser areas, handyDART services are provided by five non-profit agencies (and one small local for-profit company in North and West Vancouver). Any surpluses earned by the non-profit agencies goes back into the same community to pay for community services. In many cases, those services benefit the same people who use the handyDART service. If TransLink concludes a contract with MVT Canadian Bus, MVT's profits will leave the community and the country. These views were expressed after weeks of reflection and in two cases with considerable outrage. Both felt they had been denied a fair opportunity to make a proposal because TransLink had failed to disclose important criteria that influenced its decision. Both would have prepared very different proposals had they been aware of those criteria. Both expended considerable funds and resources to prepare quality proposals which now appears to have been wasted due to TransLinks non-disclosure. There is a last opportunity for the TransLink Board of Directors to listen to these agencies and direct its management to correct the flaws in the RFP selection process. The fiasco in 2004 certainly provides a precedent for it to do so. At the least, the organizations that bid on only one area should be given an opportunity with adequate time to amend their proposals to bid on all three areas. At least two agencies or combination of agencies, one in the South of Fraser area and one in the North of Fraser area would do so. TransLink can then apply all of its criteria to all bids on a fair basis. One can only hope that a decision will take into account the knowledge and experience of those agencies with the users of the system and the use to which any surpluses are put. «» October 1, 2008 The meeting is scheduled for 9:00 am to 10:00 am at the Firefighters' Hall, 6515 Bonsor Avenue, Burnaby. Anyone who wishes to make a presentation to the Board was expected to have applied to do so before 8:00 am today, which is very short notice. The period for public input may be extended at the discretion of the Board. A summary of agenda items is on the Translink site [click here]. Anyone who is concerned by the selection of an American company with a business and labour relations background that has been subject to considerable criticism and which has never operated in Canada before, should attend and express their views. «» September 29, 2008 Information leaked from TransLink indicates that MVT is seeking to have some of the outgoing contractors extend their contracts so that MVT can phase in taking over the system. This might not have been surprising if it has been part of MVT's proposal. It was not; MVT's proposal was to take over all areas on January 1, 2009. TransLink announced its selection of MVT on August 5, 2008. More than seven weeks later, MVT has woken up to the fact that it is a much bigger and more complicated task than it realized. Does MVT really know what it is doing? One might expect that TransLink would hold MVT to its proposal. After all, in the seven weeks that has passed, the current operators have no doubt given termination notices to non-union staff and layoff notices to union staff. Changing all that is not an easy matter and may add substantially to their costs. TransLink surely must know this. But TransLink is approaching some of the current contractors with requests to cooperate with rescheduling the handover of their operations to permit MVT to phase in. Does TransLink know what it is doing or what it has done? This development confirms the view we have been expressing, that MVT was unaware of significant aspects of what it was bidding on and the issues and problems it would be faced with if successful. MVT's transition team is not up the the task and has only recently begun to grasp the enormity of it. And TransLink, simply accepted the glib and glossy proposal of a company that has never before operated outside of the USA, let alone in Metro Vancouver, without properly investigating its background. The situation has not smelled right for some time and the smell is getting worse. We agree with TransLink CEO Prendergast. TransLink has got to see if there is something wrong with it and should do so before it is too late to avoid another debacle. «» September 29, 2008 «» September 24, 2008 «» September 21, 2008 In 1999, MVT was a $24 million per year California family company. By 2007, it had grown almost 20 times the size to $450 milion per year with Mr. Monson at the helm. Laidlaw was purchased recently by the multinational First Bus group. One cannot avoid wondering whether TransLink was aware of this history when it considered MVT's proposal. Judging from what appears to have been a complete lack of effective background check on MVT, it seems highly unlikely. «» September 21, 2008 It is now clear MVT has been shaken by the magnitude of union expectations which are well above $20 per hour and huge cost increases in benefits packages. Ironically, it may have unwittingly lent encouragement to those expectations in its communications with the unions , intended largely to satisfy TransLink and ensure that MVT would be able to hire most of the current drivers. The owner of the current North Shore handyDART operator, Enid Jeffreys, was quoted by the North Shore News as asking about MVT:
Perhaps this was a rhetorical question. Regardless, it is obvious that the answer is “no”. Perhaps this is why despite the passage of time, MVT still has only a Letter of Intent with TransLink, and no contract has been concluded. «» September 17, 2008
This issue was first identified some weeks ago. In its August 26 bulletin [click here], CAW said:
The underlying message of the current bulletin is that no progress has been made on this issue and CAW is serving notice that this will be a major issue in transition and negotiation of a first collective agreement with MVT. Two out of three criteria may not be enough. The move from non-profit organizations to MVT which has been warmly welcomed by CAW and ATU may lead to the loss of the Municipal Pension Plan which is valued so highly by their members. «» September 17, 2008 «» September 11, 2008 We had speculated that MVT had simply requested MVT to provide a response, and had repeated it as its own, but wanted to be sure. On September 5, we requested the source of TransLink's information and particularly whether it was requested from and provided by MVT. There has been no reply. It is now obvious that TransLink in fact obtained the information that it presented in defence of MVT from MVT itself. This is a bit like the police investigating an alleged crime by asking the person accused whether he or she did it, then reporting the reply as the truth and closing the case. There is something more deeply troubling about this. It is the apparent failure of TransLink to properly investigate the record and credibility of MVT before selecting it and even after issues are raised. It seems that TransLink simply accepted the glowing public relations statements no doubt submitted in its bid as the truth and went no further. When confronted with the inadequacy of this approach, it has gone into damage control denial and repeats its failure to properly investigate. In the case of current contractors, there would have been little need to investigate. TransLink is in frequent contact with them. It receives reports of any problems and how they are handled and hears about any problems or dissatisfaction from users of the service or their advocates. But MVT is an unknown quantity in this province. It is a large American company with many contracts scattered across that country. It is constantly bidding on new contracts, frequently winning them. It also frequently loses contracts to competitors, such as its recent loss of the Seattle paratransit system. No doubt MVT refers to its success stories in its bid, but not its failures or disasters. Does TransLink really have an accurate idea of what MVT is like as a paratransit contractor? Apparently not. It seems to have relied entirely on the content of the bid documents without any rigorous investigation, or even a search of the internet and follow up. TransLink appears to have brushed aside publicly reported incidents and issues even before asking MVT to respond to them. And now, it seems to be asking stakeholders to accept on faith the unblemished and blameless account MVT gives of itself. This leave us with little confidence in the same TransLink manager's statement that the fact that MVT had bid on all three areas was not considered in finding it to be the superior proponent in each of the three areas. That lack of confidence is not alleviated by the way in which the selection decision was handled. It was far from transparent. The report by the CEO to the TransLink Board of Directors on this topic was uncharacteristically brief given the recent history of handyDART contracts. It was one short paragraph that was buried on page seven of the July 18, 2008 report with another matter under the heading “bus service” [click here]. The minutes of the July 31 Board meeting, if there are any, are not published on TransLink's website. What appears is a “Meeting Summary” which contains a single short paragraph authorizing management to negotiate with the preferred proponent (MVT). These documents maintain the veil of secrecy surrounding the selection process itself. What we do know is that TransLink management decided to put all its eggs in one basket. If MVT looked good, why not try it in one area and see whether it performs up to its claims. The other two areas could be awarded to the best proponent that had already successfully and satisfactorily operated it. That would seem to have made the most sense. After all, the new plan was already making major changes and consolidation by condensing the service from eight to three areas. But TransLink decided to risk everything, throw the known out and risk the entire complex task of consolidating the three areas to one unknown company which has no experience here, and to expect it to further consolidate the operation to a single area as well. It seems to us that this task would be entrusted only to a contractor in whom TransLink has very sound reasons to place such trust. Unfortunately, TransLink does not appear to have sufficient reason. The results are anyone's guess. But is that an acceptable risk to take with TransLink's most vulnerable passengers? |
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