A structures supervisor was NJ Transit’s second-highest paid employee last year, coming within $16,342 of the agency’s CEO and president.
Of the top 25 wage earners at the state’s public transportation agency, only three were in the executive ranks, the rest were front line employees – including train conductors and assistant conductors, police, locomotive engineers and people who maintain the system – who had their total salaries boosted by overtime in 2021.
Last year, 24 employees earned more than $100,000 in overtime. In Fiscal Year 2021, bus, rail and police operations overtime expenditures totaled $176.4 million, representing a $6.4 million – or 3.7% increase – from Fiscal Year 2020′s amount of $170.0 million, said Jim Smith, an NJ Transit spokesman.
NJ Transit’s overtime increased by 2% in 2021 when compared to 2019, he said.
“Unforeseen events such as COVID play a significant role in dictating how much overtime is needed,” Smith said. “We also saw an approximately 19% increase in retirements in 2021 when compared to 2020, which have had an impact on O/T.”
In the worst case, COVID resulted in train and bus cancelations, especially when the Omicron variant caused cases to spike in late 2021 and sidelined hundreds of NJ Transit employees. Use of overtime helped when other workers were out sick.
A structures supervisor was the second-highest wage earner at the agency, taking home a total salary of $263,657, which was comprised of $163,605 in overtime, in addition to their $90,750 salary. That 13-year veteran came close to CEO and President Kevin Corbett’s $279,999 annual salary, according to NJ Transit salary records obtained through an open public records act request.
He was followed by a train conductor with 26-years of service on the railroad, who made the third-most overtime at $100,967 to bring his base $74,942 salary to a total of $259,432 last year. He’s among 11 train conductors who were among the employees with the top 25 highest salaries.
Other reasons why employees have to put in overtime include providing peak/off-peak service requirements, extra service for special events – such as sports event at MetLife Stadium and concerts, officials said. Employees also may have to put in for overtime to complete critical maintenance repairs that aren’t finished by the end of a shift, officials said.
The more public examples of overtime can be due to emergencies after bad weather, due to repair work or clearing rail lines of debris and trees.
In mid-March, high winds blew down trees that damaged structures that supported overhead catenary wires that power electric trains on the Morris & Essex lines. That cut service to 22 towns in three counties and crews worked round the clock to clear the line and repair the damage and restore service.
NJ Transit’s overtime performance was slightly better than the 8% increase that New York’s larger Metropolitan Transportation Agency reported in 2021 over 2020. The MTA had 300 employees that earned more than $100,000 in overtime and it enacted 15 steps to improve its overtime management oversight, recommended by a consultant in the wake of a 16% jump in overtime within the MTA between 2018 and 2019.
An analysis by Empire Center found two NYC transit employees earned more than the $325,600 annual salary paid to agency’s president in 2019. MTA overtime spiked at $400 million that year.
“NJ Transit has managerial oversight of overtime,” Smith said. “All overtime hours are reviewed, approved and tracked in the payroll system to identify the reason or project associated with the overtime cost. Usage is regularly reviewed and reconciled to identify opportunities to minimize or offset overtime.”
Do those levels of overtime pay mean that NJ Transit needs to hire more people? That answer is complicated, an expert said.
“You need to look at the big picture, there’s always fluctuation, but generally the red flag is when an organization ... is paying above three percent of its employee budget in overtime,” said Bill Castellano, a Human Resource Management professor at Rutgers University School of Management and Labor Relations.
How did NJ Transit do? The fiscal year 2021, Bus, Rail and Police operations overtime expenditures of $176.4 million represented 27% of those departments total operations labor costs of $661.8 million, Smith said.
“Individually, it (overtime) should be no more than 10% (of a person’s total salary) – those examples of people doubling their play, clearly they are working significantly more than 10% of the normal hours they’d be working,” Castellano said.
Where that level of overtime can become a problem is when it affects job performance, he said.
“There is a lot of research that when you’re working that many hours of overtime, your fatigue level increases, the amount of errors increase, even productivity starts decreasing,” said Castellano, who added he does work force planning research. “So it really makes no sense for people to be working an excessive amount of overtime like that.”
NJ Transit is subject to federal regulations that control how long rail crews and bus drivers can work, and the duration of specify rest periods required between assignments.
Employers have to look at what is really driving overtime, if it’s temporary and whether there are opportunities to make changes, such as rescheduling and redeploying employees, he said. Other options include hiring temporary workers and asking employees to want to retire to gradually wind down their work, he said.
“A lot of companies are looking at phased retirements,” he said. “There are options to incentivize people to phase out instead of leaving.”
NJ Transit has constraints, such as Federal Railroad Administration regulations requiring a certain amount of qualified people in a train crew. Bus drivers also require specialized commercial and passenger licenses and people who hold them are in high demand by transit agencies, school districts and delivery companies.
“FRA regulations require a minimum staffing level on trains in order to operate,” Smith said. “Train crew member shifts due to absences are filled using overtime in order to maintain uninterrupted service for our customers. These shifts can only be filled with existing, qualified train crew employees.”
The ultimate solution is to hire more employees, but that comes with hidden costs, Castellano said.
Usually, employers have to consider the entire cost of hiring new employees, salary and benefits, he said. Those non-salary costs can add 40% to 50% to the cost of bringing on a new employee, he said.
A new class of eight police officers will help fill vacancies in NJ Transit police department but will have minimal impact on overtime, Smith said. NJ Transit hit a milestone last fall when a class of locomotive engineers brought the ranks to a goal of 400 people.
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Larry Higgs may be reached at lhiggs@njadvancemedia.com.