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Labor
Rate Bill
Strategy Meeting |
Industry To Set Strategy For Important Commission Hearings
A modified version of our Labor Rate Bill passed the state legislature and was signed by the governor on July 3rd. Between now and December 31, 2008, a special commission will meet, hold two public hearings, and issue a report on the need for our Labor Rate Bill. Building upon all of the work so many of you have done over the past year-and-a-half, we have set a comprehensive strategy for the final and most important push that we need to provide for the passage of the Auto Body Labor Rate Bill.
This is a unique opportunity for our industry as we have not gotten an important bill this far along in decades. The time is now. Owners, managers, technicians, and administration people all need to attend this meeting. Our message must be clear and we must execute our strategy perfectly to win. Everyone has a role to play in this effort.
THIS IS ONE OF THE MOST IMPORTANT LABOR RATE BILL MEETINGS IN 2008!
Don’t miss your opportunity to help our industry win this important battle. Please check off the meeting you will attend and send your check today to the address below. Thank you for your support.
Springfield Area / Pioneer Valley / Berkshires / Western Massachusetts
Monday, September 22, 2008 ~ American Legion, 292 New Ludlow Road, Chicopee
Boston Area / Metro South / Eastern Massachusetts
Tuesday, September 23, 2008 ~ Knights of Columbus, 1211 Highland Ave., Needham
North Shore / Metro North / Merrimack Valley / Northeastern Massachusetts
Wednesday, September 24, 2008 ~ West Side Social Club, Harrington Court, Wakefield
Metro West / Worcester Area / Central Massachusetts
Monday, September 29, 2008 ~ Marlboro VFW Hall, 1 Fitchburg Street, Marlboro
South Shore / South Coast / CapeCod / Southeastern Massachusetts
Tuesday, September 30, 2008 ~ Middleboro Elks Lodge, 24 High Street, Middleboro
All Events Begin With Food at 6:30 PM
Download Flyer Here
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The Labor Rate Bill is necessary because auto collision shops in Massachusetts receive the lowest labor rates in the United States, despite operating in one of the highest cost areas. This does not make any sense.
Currently, the average labor rate in Massachusetts is approximately $34.50. By any comparison to labor rates in any other service industry field, this rate is, by far,
the lowest.
If adopted, H-1085 will still provide insurers with adequate “discounts” on labor. As a point of reference, mechanical auto repair rates range from $70.00 to $115.00 per hour in Massachusetts.
Auto collision shops have been receiving inadequately low rates since
1988, when cost containment regulations were adopted in 211 CMR.
Currently, the collision industry believes that the insurers have interpreted the cost containment provisions in CMR 211 93.04 (4), and 211 CMR 93.05 much too broadly, and now violate the principle of fairness for labor rates that is included and specifically specified in those regulations.
The Labor Rate Bill, H-1085, would set up a commission with equal representation of the collision industry, the insurers, and political leaders, and that commission would oversee all issues relating to insurer-paid labor rates in the future.
The commission would determine a national average labor rate, index that rate to the Massachusetts labor market according to figures from the US Bureau of Labor Statistics, and verify those market-based rates to the Insurance Division for enforcement. This is a moderate and fair method of introducing objective, market-based rates into this system.
Auto collision shops would have to comply with higher standards determined by the commission, in order to receive the rates verified to the Division of Insurance. Shops would be classified as “A” or “B” shops, depending upon their qualifications.
The classification system will be helpful to insurers in many ways – quality work, streamlined operations, lower administrative costs, higher efficiency from more professional shops.
In combination with the cost savings insurers will receive from the final adoption of 212 CMR 2.04A (Expedited Supplemental Appraisal Procedure), which was voluntarily submitted by the collision industry, the effect of the Labor Rate Bill on insurance premiums will be negligible.
The higher standards and the classification system will be a great benefit for
consumers.
The Labor Rate Bill is essential for the continuing survival of a qualified, professional and competitive auto collision industry in Massachusetts.
Passage of the Labor Rate Bill will allow auto collision shops the ability to offer a fair career path for thousands of trained vocational school graduates who currently don’t enter the industry because starting wages are too low.
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