Local News

The MBTA will pay employees to leave as it seeks to trim staff

Evan Richman/Boston Globe

June 2, 2016

2 minutes to read

Hoping to save $37.5 million per year in wages and benefits, the MBTA will pay retirement-eligible workers to hang up their hats, and also offer buy-outs to some non-retirement-eligible workers.

The T is seeking to reduce its headcount by a total of 300, MBTA Chief Administrator Brian Shortsleeve said.

To get retirement-eligible employees to call it a career, the T will offer the eligible workers 20 percent of their current salaries, which averages out to $16,576 among eligible employees.

Meanwhile, employees who are not of retirement age with between five and 10 years of experience can leave the MBTA in exchange for a $5,000 payout. And non-retirement-eligible employees with more than 10 years of experience can take $10,000 on the way out the door.

“We think the annual recurring savings…far outweigh the short-term impact of the incentive payment,” Shortsleeve told reporters Wednesday.

Shortsleeve said the T wants 300 employees to take the agency up on the retirement program, with another 200 volunteering for the buy-out. After reorganizing departments and consolidating some positions, about 200 of the 500 total departures would be filled with new hires.

Overall the organization’s staff of 6,500 would drop by 300, saving the T $25 million per year in wages and another $12.5 million in benefits, including pension payments.

The final number of employees deboarded by the T could wind up looking different from those plans, depending on the wages of those who take the T up on the offer.

“We’re frankly more focused on the dollars than the headcount,” Shortsleeve said.

T officials have said they would explore a retirement incentive program for several months prior to its unveiling Thursday.

If employees do not volunteer for the program, however, Shortsleeve said layoffs are a possibility.

“We hope [the programs] are going to be successful. Beyond this, everything is on the table,” Shortsleeve said. “We’re very serious about putting the T on the path to long-term structural stability. … We’re hoping through voluntary programs first that we give people the freedom and the flexibility to choose.”

MBTA vehicle operators will be eligible to take the retirement package, but will not be eligible for the non-retirement buy-out. Any drivers who do leave will be replaced, and the T is actively hiring drivers, Shortsleeve said.

Even though they would be directly replaced, drivers who take the retirement package would still save the T money because of the differences in wages for experienced and new drivers, he said. But the objective of the program is chiefly to lower the T’s corporate and administrative staffing levels.

Part of that aligns with another upcoming T budgetary goal: Outsourcing parts of the agency’s functions to private companies. Portions of the agency that could be privatized include its cash-counting department, marketing departments, and the CharlieCard store.

“We certainly hope we will have significant uptake [on the incentive packages] in those areas,” he said.

Contracting out more services has been a major ambition of the agency under Gov. Charlie Baker, and a point of contention for its unions. Shortsleeve said it will be a point of emphasis in the coming weeks at the T.

Shortsleeve said labor unions had been briefed on the incentive programs. MBTA employees will receive letters about the programs this week. Starting within a couple of weeks, they will have a 30-day window to express their interest in the programs, Shortsleeve said.

The MBTA will stagger and be strategic about the timing of departures for employees who take the agency up on the offers, to make sure they do not interfere with the agency’s operations, he said.