Hundreds of bus routes flipped under RFP system in Toronto area

Union calls for consistency in contract procurement

The contracts for more than 450 Toronto-area bus routes were flipped in late February as part of the province’s request for proposals (RFP) system.

But the system will lead to instability for drivers, parents and — especially concerning — students, said Unifor, Ontario’s largest school bus driver union.

“This isn’t developing a stronger service,” said Unifor researcher Angelo DiCaro. “The system is just getting weaker and weaker.”

Pilot RFPs were implemented throughout the province beginning in 2009, with a full transition to the RFP system required in time for the 2013-14 school year. The mandate came from the Ministry of Education in an effort to have school boards adhere to the public sector procurement directive.

The broader public sector procurement directive requires all publicly funded contracts over $100,000 to incorporate some form of competitive procurement.

Transportation consortia comprised of multiple school boards were established and tasked with the procurement of school bus contracts through the RFP system.

Prior to the system, school bus contracts were managed by school boards and the contracts were, essentially, evergreen contracts.

“As long as there really wasn’t a problem with the contractor, the contractor would keep getting the work from the school boards,” DiCaro said.

“School bus drivers would have some sense of stability. Although the jobs have always been challenging and precarious, there was never a threat that, every few years, they would basically tender these transportation contracts under a competitive framework.”

By requiring service providers to bid on bus routes, DiCaro said, it is believed monopolies will be prevented and the spirit of competition will result in more cost-efficient services.

“Our concern is when you create a system like this — which is basically based on the spirit of competitive procurement and trying to keep bids low so that your costs aren’t soaring — this will directly affect the bus drivers,” he said.

“For a company to manage their cost structure, they’re going to suppress wages. And that’s what we’re seeing.”

According to the union, there is no guarantee drivers affected by routes flipped under the RFP system will see their position transferred over to the new provider. And even if the drivers are hired on by the new provider, it is likely they would lose any gains made with their previous employer.

“They’re essentially going to be resetting back to when they started,” DiCaro said.

“If they made wage increases over time, they’ll likely be back at minimum wage with no benefits, no seniority and, in five years, we’re going to do it all over again. Our biggest concern is that while the province is really gung-ho about this competitive bidding system, they have totally neglected the impact this is going to have on drivers.”

Drivers, students play role
The needs of drivers and students play a large role in the RFP system, according to Kevin Hodgkinson, general manager of the Toronto Student Transportation Group.

“The whole point of the process is to be fair and transparent,” Hodgkinson said. “The RFP is based 55 per cent on price and 45 per cent on other qualitative factors, which include safety programs, communication protocols and accident reporting.”
Based on information from carriers, Hodgkinson said, as many as 80 per cent of existing drivers on recently flipped routes will be moving over to new carriers to continue providing service.

“In terms of consistency, we like to see the same driver doing the same routes because they’re familiar with the area and the roads, with the students, with the schools and their policies,” Hodgkinson said.

“Driver-wise, we’re not as concerned because we’ve found drivers move between companies as far as contracts go.”

Unifor, however, is arguing the assumption that drivers will be pulled over to new carriers is not enough. The union is calling for a mechanism that would protect drivers’ wages by removing them from the RFP system.

“Take wages out of the competitive framework,” DiCaro said. “If they want companies to compete, that’s fine. They can find other creative ways to find efficiencies. But that shouldn’t come at the expense of people’s wages.”

According to the Ontario School Bus Association (OSBA), however, driver wages are the single largest expense with respect to student transportation contracts.

“It’s important to understand that roughly 50 per cent of every dollar that is spent in transportation in Ontario in the contracts themselves goes back out in wages to drivers, mechanics and support staff,” said Les Cross, president of the OSBA.

While it would likely be difficult to remove wages from the RFP system altogether, Cross said other provinces using the RFP system have introduced a wage floor to create consistency for drivers moving to different carriers.

“I don’t think anybody should be winning a contract on the backs of labour and the RFP process itself does give us the opportunity right now to reset the bar with respect to driver wages,” Cross said.

“It’s going to be important for the new carriers to establish a fair wage that they’re going to be able to sustain.”

DiCaro agreed that sustainability is a huge concern moving forward, as the union works toward creating an environment that fosters consistency.

“Children taking the bus, they develop a relationship with that driver. There’s a trust factor that’s built into this contract. The parents send their kids off to school and they expect they’re going to arrive at school safely,” DiCaro said.

“Having that friendly, familiar face on the bus — it may sound a bit romanticized — but I’ll tell you, as a parent myself of young kids, that means everything to me. The idea that the person who is charged with delivering the most precious cargo we’ve got, in our kids, that we treat them so poorly, I don’t understand that.”

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