Repairers Win Big against Labor Rate Suppression
by Alana Quartuccio
Massachusetts collision repairers finally have something to celebrate as 2025 gets underway!
Just weeks before 2024 came to a close, auto body professionals got what they’ve been waiting years and years to achieve – a victory in a long, and still ongoing, battle in the fight against labor rate suppression.
On November 19, Governor Healey signed an Economic Development Bill package, approved by the House and Senate, that includes long-pursued language regarding the creation of a mechanism to address the artificially suppressed labor reimbursement rates Commonwealth collision repairers have endured for so many years. This will establish an auto body labor rate advisory board consisting of representatives from the auto repair industry, along with insurance representatives and an appointee from a consumer advocacy group and others to meet, study and review in order to make recommendations to the Division of Insurance for a fair and equitable labor rate. (See full language below.)
AASP/MA has been leading the fight for years, shouting from the rooftops, rallying on Beacon Hill and lobbying for legislation, all because the insufficient insurer-controlled $40-an-hour labor reimbursement rate – the lowest in the nation – is just not enough to cover technician and office worker salaries, equipment, rent, training, healthcare and all of a collision repair facility’s overhead costs. Costs continue to rise year after year as the pressures to keep up with advanced technologies in these vehicles pile on even more financial burdens.
But finally, their cries have been heard, and things are moving in the right direction.
“For the first time, our industry will have a voice at the table,” professed AASP/MA Executive Director Lucky Papageorg about the triumph. “We will now be at the table to discuss the intricate part of our business which is the labor reimbursement rate. It’s not about severity or paint and materials – it’s about the labor reimbursement rate. It is now up to everyone in the collision industry to take stock and make a decision about their future. Do they want to continue to just ‘survive,’ or do they want to create and be part of a thriving industry, one which draws talent to it rather than one which struggles to pay a fair and commensurate wage to its talented employees? Employees who, for decades, have seen their ability to earn a wage reflective of their knowledge and expertise, while keeping pace with the everchanging repair methods needed to repair today’s vehicles, eroded by artificially suppressed reimbursement rates paid by insurers. Now is the time to make a statement!”
AASP/MA sent this message to the entire collision repair community in the Commonwealth after learning of this win.
“This victory comes after a long-fought battle in the Joint Conference Committee and was one of the final sticking points to be resolved. Despite the immense lobbying efforts of the executive directors of the Massachusetts Insurer Federation (MIF) and the American Property Casualty Insurance Association (APCIA), backed by over 50 lobbyists and significant financial resources, AASP/MA’s efforts prevailed. The tireless work of our one executive director, our lone legislative agent (lobbyist), the Alliance’s Board of Directors and – most importantly – you, our members, ensured our voices were heard loud and clear.”
“This is a major legislative victory for AASP/MA,” stated Guy Glodis, the association’s lobbyist. “This language, as inserted in the Senate Economic Development Bill and later accepted in the Legislative Conference Committee (and signed into law), is the first head-to-head legislative battle we’ve won against the insurance lobby in decades. This language and legislation is the bedrock of a process that will no longer stagnate our reimbursement rate but will truly address and ensure a fair and equitable rate for all collision repair shops in Massachusetts. AASP/MA, its executive board and legislative committee continue to make significant progress with meeting legislators, educating the legislature and promoting our legislative agenda in Boston. We anticipate continued success in the 2025/26 legislative session, and we want to thank all the shops, businesses and membership for their steadfast outreach and advocacy with their legislators and legislature.”
“It’s been a long road,” shared Kevin Gallerani, immediate past president. “This association has been pushing legislation in favor of a fair labor reimbursement rate for decades. This is a huge step forward for us and for the industry as we have been held back for 30-plus years. We’ve made some strides with our efforts having seen small increases in labor reimbursement rates over the past couple years, but it’s only amounted to a couple of bucks here and there. Thanks to this legislation, this Advisory Board will have to evaluate the labor reimbursement rate and evaluate why it’s so low. The only direction we can go is up. We will finally have a Board put together to discuss this issue and only this change to ‘the’ issue of the labor reimbursement rate, so this is a huge step in the right direction for our future.”
The association commends all those in the industry who participated by spreading the word via phone calls, letters and attending legislative fundraisers, helping to accomplish a first for repair shops here in Massachusetts.
As part of the legislative action, AASP/MA has been granted the privilege of naming three auto body professionals to this Board and were in the process of selecting those individuals at the time of this writing.
Clearly, the work is not over and has only just begun. In addition to their efforts in support of a fair and reasonable labor reimbursement rate, the association will continue its push to see that the Auto Damage Appraiser Licensing Board (ADALB) be moved from the Division of Insurance to the Division of Occupational Licensure.
The new year also brings new leadership and new faces to the AASP/MA Board! Matthew Ciaschini (Full Tilt Auto Body & Collision; West Hatfield) has moved up to the role of president after spending two terms as vice president under Gallerani, who will remain an active member of the Board as immediate past president. (See page 24 to read what Ciaschini foresees is next on the horizon for the Massachusetts auto body association.)
“Our voices are being heard and understood,” added Papageorg. “We’ve built strong allies at the highest levels in both chambers, many of whom will be future leaders in the upcoming legislative session. We must continue applying relentless pressure to create a platform where the collision industry can once again thrive. We are a great industry – and we can be even greater!”
ECONOMIC DEVELOPMENT BILL: Section 292 of H5100
SECTION 292. There is hereby established an auto body labor rate advisory board to address any issues related to auto body labor rates. The advisory board shall consist of: 1 person appointed by the commissioner of insurance, who shall serve as co-chair; 1 person appointed by the attorney general, who shall serve as co-chair; 1 person appointed by the director of standards; 3 persons selected from the auto insurance industry by the Automobile Insurers Bureau of Massachusetts; 3 persons selected from the auto repair industry from different geographic regions of the commonwealth by the Alliance of Automotive Service Providers of Massachusetts, Inc.; 1 person selected by the Massachusetts State Automobile Dealers Association, Inc; 1 person selected by the Massachusetts Association of Insurance Agents, Inc.; and 3 persons to be appointed by the co-chairs, 1 of whom shall be from a consumer advocacy group, 1 of whom shall be from a group representing the business community and 1 of whom shall be an economist with expertise on the insurance industry. The advisory board shall be responsible for creating, implementing and overseeing a survey given to relevant auto body shops. The advisory board shall collect industry data including, but not limited to: (i) labor rates in neighboring states; (ii) auto body shop costs; (iii) total labor costs; (iv) inflation data; (v) workforce data; (vi) vocational-technical school trends; (vii) insurance premiums; and (viii) any additional information as requested by the advisory board. The results of the survey and the data collected shall be reviewed and analyzed by the advisory board.
Not later than December 31, 2025, the advisory board shall make recommendations to the Division of Insurance for a fair and equitable labor rate and file a report of its findings, conclusions and recommendations with the clerks of the senate and house of representatives, the joint committee on financial services, the senate and house committees on ways and means and the division of insurance.
Want more? Check out the January 2025 issue of New England Automotive Report!