Without a contract, ASO musicians locked out as sides ponder next move

Atlanta Symphony Orchestra.

Atlanta Symphony Orchestra.

For the second time in as many years, Atlanta Symphony Orchestra musicians have been locked out by the orchestra’s administration after the players’ collective bargaining agreement expired without a new deal being reached between the two sides.

The inability to agree to a contract by the 11:59 p.m. Saturday deadline was not a surprise. Management and the musicians had talked for eight months but, despite small progress, their positions remain polar, their partnership fraying.

Management said its latest proposal was for a four-year deal with an escalating salary increase topping out at 4.5 percent in the final year. The musicians propose a roughly 15 percent salary increase over five years — basically the amount the players gave up in bitter negotiations in 2012.

Salary isn’t the only issue this time. Another point of division is health care, with the musicians being asked to shoulder a greater share of the cost which they said would turn management’s raise offer into a net decrease. An individual would pay 17 percent of costs, up from 7.5 percent, according to management. For family coverage, musicians would be asked to pay 23 percent, up from 2.5 percent.

Also at issue is a proposal by management to negotiate with music director Robert Spano and musician representatives on whether and how individual musician positions would be filled as they become open. In cases where there was not a consensus, ASO president and CEO Stanley Romanstein would have the final say.

Full-time player ranks were reduced from 95 to 88 in the last collective bargaining agreement, and the musicians say management proposed a buyout of musicians with 30 or more years of experience this time. The players want to build back to the full complement.

On Sunday, both sides said they would continue talks, but sounded weary and wary when pressed on the prospects of beginning the ASO’s 70th anniversary season as scheduled on Sept. 25.

“Of course we’re extremely concerned, but we’re resolute and amazingly resilient,” said Paul Murphy, associate principal viola and president of the Atlanta Symphony Orchestra Players Association.

Romanstein said the musicians’ offers would add $2 million to $2.5 million in red ink. “So, unfortunately, their proposals take us in the wrong direction.”

The ASO president and CEO said he was willing to have a federal mediator join the talks, cited as a positive move for both sides in the recent Metropolitan Opera accord. The musicians said they wouldn’t rule that out but believe a mediator, who does not have binding power in forging an agreement, would only add another layer between themselves and the executive committee of the Woodruff Arts Center, the ASO’s parent nonprofit. While they continue to negotiate with Romanstein and other ASO and Woodruff management, that’s where they believe the power resides.

Despite the vow by both sides to continue talks, the players sounded strong notes of distrust of management in general and Romanstein in particular.

“There is no trust that (management) has the best intentions of this orchestra, except to try to get a balanced budget, even if it means you have an orchestra with 50 pieces,” said Daniel Laufer, an ASO cellist and negotiating committee member.

The musicians claim that ASO leadership broke a 2012 promise to avoid returning for a second round of reductions.

They produced a quote they said Romanstein made at full orchestra meeting on Dec. 18, 2012, alleging that he responded to a question with: “My comment to the (Woodruff) and the ASO boards was, ‘If we have to make a one-time adjustment to prevent ourselves from going out of business, then we can try this once, but not year after year. Nobody wants that.’”

Romanstein adamantly denied the comment on Sunday. “I don’t know where that came from. We made them no promises. I would love to have a guarantee for what’s going to happen in two years or three years or four years. But there are not guarantees and we didn’t offer them any.

“What we did say to the musicians, and (ASO and Woodruff leaders) said it collectively, was,” he continued, “that for whatever compensation you’re willing to forgo, we would match that with both new fund-raising and with additional expense cuts on the administrative and programmatic side. And we did exactly what we said we were going to do.”

ASO and Woodruff leadership say they have secured $5.5 million in corporate and anonymous donations since the last contract. They added that they have trimmed expenses, through ASO staff reductions (from 61 to 48) and other cuts, by $400,000.

After a month without pay in 2012, the locked-out players rancorously conceded to significant concessions: a $5.2 million wage reduction over two years (amounting to $14,000 annually per player), with the salaried season trimmed from 52 to 41 weeks in 2012-13 and 42 weeks in 2013-14.

The ASO finished the 2014 fiscal year with a $2 million operating deficit on a budget of $37 million. It was a marked improvement on fiscal 2013’s $2.9 million deficit and on 2012’s $5 million deficit, but Romanstein called further deficit operations unsustainable.

The ASO has racked up deficits for a dozen years, but the push toward a sustainable model took new urgency when the  accumulated debt rose to $23 million by the end of the 2012 fiscal year, including $18 million borrowed against earnings on the orchestra’s endowment and $5 million owed to its parent nonprofit, the Woodruff Arts Center.

Last year, Moody’s Investors Service downgraded the Woodruff’s credit outlook from stable to negative, largely because of the ASO debt.

Woodruff president and CEO Virginia Hepner, a former banker, said such an assessment is serious business, affecting the art center’s ability to attract project financing and interest costs.

“It matters … and the entire board is cognizant of it,” Hepner said on Sunday. “It impacts every art form we have here. That’s why it’s essential” for the ASO to balance its books.

In May, the ASO and Woodruff’s boards, trying to ease the financial pressure, decided to treat the money borrowed against the orchestra’s endowment as a distribution. That means the loan does not have to be paid back. Thus the orchestra’s accumulated debt is now down to the $5 million owed the Woodruff.

“If the musicians will come to an agreement with us to pay a fair share of health coverage, and take a flexible approach to how and when we fill vacancies in the orchestra, we can position the ASO for long-term financial stability,” Romanstein said. “Two years later, we have a much smaller deficit than before and we think we have a clear path to (resolving) it.”

The musicians had offered a “play and talk” scenario if a deal was not made by the deadline and on Sunday were reeling from management’s decision to lock them out, halting their pay, again. Their health benefits will continue through the end of the month; they then would qualify for COBRA continuation health coverage required by federal law.

“It’s incredible that here we are again two years later,” cellist Laufer said. “Management’s only solution seems to be to further cut into this orchestra — I mean, we are the orchestra.”

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