THE SIX-MONTH LOCKOUT at National Grid ended on Monday when employees approved a new contract that appears to give the utility what it wanted in two key areas while offering members of the steelworkers union a number of improved benefits, including what amounts to a 22 percent salary increase over 5 ½ years.
“We made the progress we had set out to make on healthcare and transitioning new hires to 401K plans,” said Marcy Reed, president of National Grid in Massachusetts, in a statement. “In return, we agreed on a number of issues that were important to the unions.”
The precise contract terms were not released, but statements from the two sides provided a number of details.
In a conference call with reporters, Reed said newly hired employees will no longer have access to the defined benefit pension plan existing workers enjoy. She said newly hired employees will instead be assigned to a defined contribution plan, under which 3 to 9 percent of their gross annual wages (depending on years of service) will be set aside in a separate account. The new workers, like existing workers, will also be able to set up 401K plans, under which employee contributions are matched to a certain extent by the company.
On healthcare, the utility had pressed the union to agree to new co-insurance and deductible requirements for all workers. The new contract appears to accept those requirements, but delays their implementation for a year. It also reportedly offers a sweetener to the union on premium payments.
The contract, which takes effect January 20, also calls for a 10 percent increase in the defined pension benefit plan for existing workers, offers no-layoff protection to all employees with more than five years of service, and provides an 18 percent wage hike over the term of the contract, supplemented with an additional 4 percent that employees had been paying into a benefits fund and will now be able to pocket. The company had originally offered a 15 percent wage hike over five years. The average employee salary, including overtime, is currently $120,000 a year.
A statement issued by the leaders of two steelworker locals focused on the wage hike; the creation of what they called “public safety-related jobs;” and the provision of additional sick time, compensation, and retire health and life insurance protections for newly hired employees. The union statement did not mention that new workers would no longer have access to defined benefit plans or mention that health insurance costs for all employees would be going up starting next year.
According to the union statement, the contract creates “dozens of public-safety related jobs.” Reed said she wouldn’t quibble with that characterization, but she said all jobs are public-safety related. “Safety was never a bargaining tool,” she said, adding that 30 to 40 new and in-sourced employees would be added to the union bargaining unit under the contract.
Employees are expected to return to work the week of January 20 and it appears the state restrictions on the work National Grid can do in the field are being lifted. A letter was sent to all natural gas utilities in the state on Friday that establishes new procedures for doing field work that are in line with legislation that passed last Monday.
The hardball contract negotiations by both sides gained prominence after the utility locked out its workers, depriving them of paychecks and health care insurance. Public interest in the lockout picked up after natural gas fires and explosions rocked the Merrimack Valley and focused attention on the safety of gas line repair work. An over-pressurization incident in Woburn in September prompted state regulators to bar National Grid from doing most field work, which in turn stalled a number of development projects in the utility’s service area.
On Beacon Hill, the lockout became a big political issue, with both parties rushing through a bill in sparsely attended informal sessions that granted locked-out workers extended unemployment benefits. Gov. Charlie Baker signed the bill into law on Christmas Eve. The measure proved to be unnecessary for the National Grid workers, whose unemployment benefits were scheduled to run out January 14.