Labor Rate Advisory Board Talks Continue as Deadline Nears 

by Alana Quartuccio

The end of 2025 is fast approaching, and as of mid-September, the Auto Body Labor Rate Advisory Board (ABLRAB) was still in the midst of collecting data and determining what type of data would be of the most benefit toward making auto body labor rate recommendations which are to be submitted to the Division of Insurance before the end of the year.

The Board held a public Zoom meeting on September 15 to finalize the terms of a survey that was to be sent to the insurance companies with one percent or more of the market share and returned within 30 days. The data was to be collected by the Massachusetts Insurance Federation. In addition, the Board spent considerable time deciding whether to dive deeper into the results collected via the body shop survey at the start of the summer. In late July, the Board discussed taking a sampling of the 527 responses they had received, which was said to represent about half of the auto body businesses in the state, for “verification purposes” to rule out any potential bias. However, the sampling of this data had yet to be done by the September meeting. 

 Economist John Kwoka (Northeastern University) called it “a good response rate” and expressed concern that asking a sampling of shops to verify their answers could have a negative response, leaving them feeling challenged. With time running out, as Peter Smith (MAPFRE) indicated, “We don’t have the luxury of time here as we are knocking on Q4,” the Board agreed to take the body shop labor rate survey data as is. 

Discussion evolved into what other considerations need to be taken into account in order to complete the task at hand. Co-Chair Stacey Gotham (Insurance and Financial Services Division) reported she received a spreadsheet listing the reported labor rates from National AutoBody Research for the neighboring states of Rhode Island, Connecticut, Vermont, New Hampshire, Maine and New York. Christopher Stark (Massachusetts Insurance Federation) promised to provide the total labor costs and insurance premiums on the insurance side for the same states for the years 2016-2023.

Considerable time was spent on how deeply the Board should examine inflation rate data. Kwoka stated, “Inflation predictions, under any circumstances, are just that – predictions with a substantial range of uncertainty. Making predictions right now is doubly difficult since a lot of pricing outcomes with the new tariffs and changes in tariffs make predictions even more uncertain. So, every one of the forecasting sources that I usually rely on always have more than usual caveats.” According to some sources, it’s predicted to be roughly between 2.3 and 3.3 percent. “If we knew the inflation rate was to be eight or 10 percent, it might influence us, but I think what we’re seeing is a moderately rising inflation rate with a considerable amount of uncertainty.” 

When discussion led to questions about examining past inflation data, Gotham queried, “I’m not really sure why we’d look at past data; we’re setting a future rate. What is the purpose? Usually with insurance-rate making you have a trend out to the time you expect it to be in effect. I’m not really sure what the purpose of going back in time and trending that data is.”

“Because the labor rates have failed to keep pace with inflation for over 40 years,” Brian Bernard (Total Care Accident Repair; Raynham) responded. “Let’s say we were to apply an inflationary expectation on top of our existing suppressed rate. We would never meet a rate that would be a reasonable rate for repairers to be able to properly pay their own employees.” He referred to data he recently shared with the Board that showed the average labor reimbursement rate across the country to be $67 per hour, while Massachusetts is at about $45, which means “Massachusetts is trailing the national average by nearly 33 percentage points. Meanwhile, if you look at ‘cost of living’ data, Massachusetts has a rating of 141.2 which translates to it being 41.2 percent more expensive to live, work and conduct business in this state than across the average of the country. We have a serious suppression of the labor rate trailing the national average while our state has the third highest cost of living. So, there’s some correction that needs to be made from the past that will allow us a jumping up point to keep things corrected for the future.”

Matthew Ciaschini (Full Tilt Auto Body; West Hatfield) addressed the elephant in the room by telling Gotham, “We’ve been talking about this for nine months, and there still isn’t an understanding of our industry and what the problems have been. We’ve been suppressed. We’re displaying it here. We have a rate that is much lower than the national average. We have a state that is much more expensive to live in than the national average. I do not know how much clearer it can be to get it across to those who are not in our industry. It’s very disturbing.

“There’s an industry dying because of this situation, and we need to do something about it,” he added. “It’s what this Board has been tasked to do.”

Siding with the collision repair professionals, David Brown (Bill Diluca Chevrolet – Cadillac, Inc.) contributed that cost of living rates should be looked at as far as before the rate was fixed, suggesting they may need “to go all the way to the 80s. Take the inflation rate from that way forward.” Gotham suggested that such information is not available, but Brown corrected her by stating that “we know what the rate was fixed at in the 80s once the format was set in place. We take the regular cost of living increase that the federal government stated it should be at and apply it with the rate, and it should give us some idea of what it should be at.” 

Stark chimed in stating he disagreed with the previous comments made, citing that “the idea that we’re just going to blanket make this about inflation when the other half of the market wasn’t based on inflation over that period of time is insane to me as a matter of public policy.”

The lengthy discussion resulted in a vote to not collect any inflation data in their study. 

Although Bernard, Brown, Ciaschini and Rick Starbard (Rick’s Auto Collision; Lynn) voted against it and Kwoka abstained, the majority approved the action. 

The Board was expected to conduct a public hearing on October 29 to gather expert testimony from representatives from the insurance and auto body industries.  

Want more? Check out the November 2025 issue of New England Automotive Report!