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Yesterday, New York’s Metropolitan Transportation Authority (MTA) announced a plan to save an estimated $22 million annually by reducing overtime costs.

The plan is a result of an internal review of more than $560 million MTA paid in overtime expenses annually. The review concluded that while some overtime is necessary to provide service, inflexible work rules, employee absenteeism and pension padding contributed to unnecessary overtime, MTA officials said in a prepared statement.

The agency’s management has committed to a series of tighter management controls that will lead to cost reductions, officials said. The actions are expected to save the MTA $22 million in 2010 and $60 million in 2011 and beyond, MTA officials said.

The actions include:
• closely monitoring shifts greater than 16 hours to reduce double-time payments, ensure productivity and limit “pension padding”;
• enforcing sick leave abuse;
• reporting overtime to agency presidents on a bi-weekly basis;
• creating specialized task forces and more intensive reporting in high usage areas; and
• engaging with labor unions to begin discussing work rule changes to eliminate unnecessary overtime.