Jacques Dubé, Moncton's city manager, calls the union's latest demands disappointing. (CBC)

The City of Moncton has refused a request by the union representing locked-out Codiac Transpo workers for binding arbitration.

"We reject the union’s request … as it leaves the decision-making process in the hands of an independent third party, with no accountability to Moncton’s taxpayers and other key stakeholders," city manager Jacques Dubé said in a statement Wednesday.

The Amalgamated Transit Union Local 1290 called for third-party binding arbitration on Tuesday after two days of mediation talks broke off without a resolution and with no future talks scheduled.

But the city maintains the collective bargaining process is the best way to resolve the contract dispute.

Meanwhile, the bus service remains suspended indefinitely.

"We feel for our residents that rely on our public transit system," said Dubé. "However, the City presented its best offer in early April. The union’s demands remain unrealistic in light of the current bargaining climate and these economic times," he said.

'Clearly, the union still thinks council will succumb to their unrealistic demands. It’s not going to happen.'—Jacques Dubé, city manager

"Clearly, the union still thinks council will succumb to their unrealistic demands. It’s not going to happen."

The city locked out the 90 Codiac Transpo bus drivers, service workers and mechanics on June 27.

The workers have been without a contract since 2010.

Several attempts to negotiate a deal have failed in the past.

With the city's refusal to go through binding arbitration, it is unclear when the union will agree to go back to the table.

"The City believes that the changes in the contract language that are needed to ensure the long-term success of Codiac Transpo are only achievable through collective bargaining," said Dubé.

"Binding arbitration allows for an unaccountable third party to determine the wages the City pays and the contract language that the City will then be bound to in managing the system into the future."

Wages remain stumbling block

Codiac Transpo workers have been locked out since June 27. (CBC)

The city manager says the union's latest demand was for an increase of five per cent every year for five years, up from its previous demand for a 4.2 per cent annual increase.

Dubé calls it "disappointing." It "clearly shows that they are not serious about resolving this dispute," he said.

"Obviously the union is not ready to move and remains entrenched in its position — despite the fact that they’ve been locked out. Clearly, they are not ready to negotiate."

The union also wants to determine the number of full-time and casual workers, said Dubé.

"Its new demands are even less appealing to city council and its administration."

The city needs the ability to allocate more working hours to casual bus drivers, said Dubé. As it stands, they don't have a guaranteed number of hours of work so it's difficult to hire and retain them, he said.

In addition, providing more hours to casual workers after permanent drivers have worked their 40 hours would allow the city to reduce overtime hours, said Dubé.

Permanent employees would still get overtime hours, but only after casual workers get 40 hours, he added.

The city had previously offered 2.75 per cent per year, but that offer is now off the table.

Dubé says Codiac Transpo employees currently earn more than $44,000 annually and many make more than $60,000 with overtime. The city's offer would increase their base salary to $50,000 in five years, he said.

"Council is prepared to wait the union out in order to get a fair deal — one that is fair to the employees, one that makes sense for Greater Moncton taxpayers, one that allows Codiac Transpo to improve its system and make it more relevant and viable, for riders, now and into the future."