Union drivers, mechanics and service workers on Tuesday won the right to bring in an arbitrator to settle a new contract with RTD, removing the possibility of a second transit strike in three years.

The order from the Colorado Division of Labor doesn't mean RTD and Amalgamated Transit Union Local 1001 will give up on collective bargaining in an effort to reach a new contract.

In fact, talks will resume Thursday for three days. The current contract expires at midnight Saturday.

But the ruling gives the union a backstop other than a strike if talks don't produce agreement.

In arbitration, a neutral third party is brought in to listen to both sides and come to a binding decision on terms of a new contract. RTD opposes that, saying it removes the incentive for the union to negotiate in good faith.

The union is seeking what it calls a "modest wage increase" while RTD is asking for a wage freeze for three years. The transit agency already has frozen the salaries of its 600-member non-union staff and reduced bus and light rail service in response to a sales tax decline of 1.3 percent last year and the prospect of continuing tough times.

"We remain hopeful that we will come to a negotiated agreement working directly with the ATU leadership," said Lee Kemp, RTD's board chair. "In these tough economic times, we need to work together and remain focused on delivering our service to the residents of the RTD district."

Local 1001 President Holman Carter said the union is pleased to have the option of arbitration although "our goal is to negotiate a fair contract with RTD at the table."

Labor Division Director Mike McArdle issued the ruling based on a hearing last week at which dozens of visually impaired and disabled people showed up to say a transit strike would be a hardship on their ability to get around.

Under the Colorado Labor Peace Act, the state can prohibit a strike if it would interfere with the peace, health and welfare of the public.

Three years ago, under a Republican administration, the division ruled a strike would not interfere with that, and Local 1001 later went on a week-long work stoppage. The same ruling was made in two earlier contract cycles under former Gov. Bill Owens.

When Democrat Roy Romer was governor prior to that, the labor decision prohibited a strike and allowed arbitration. It was used in 1997. In 1994, RTD and the union reached a contract agreement without resorting to arbitration.