Work/Rest Guidelines/Principles

Please find enclosed a copy of the Work/Rest Guidelines/Principles signed yesterday by United Transportation Union, the Brotherhood of Locomotive Engineers, and the nation's major freight railroads, which provides for a comprehensive program of education, training and operational changes to address safety concerns associated with fatigue on the job and related quality of life issues. The document contains a series of measures based on the latest scientific research and findings in this area that will enhance rest opportunities for the membership and address the causes of fatigue in the railroad industry.

The Guidelines provide for the establishment of a "Work/Rest Committee" on each carrier no later than May 2, 1999. Labor and management will be equally represented on each Committee and will have an equal vote on any Committee action. Each Committee will develop an education and training program on the effects of fatigue and possible corrective measures for employees represented by the UTU and BLE. Also, each Committee must develop by September 18, 1999 and implement by December 18, 1999, a program that will address matters such as assigned work days and predictable rest days for extra and pool employees working in unassigned freight service, guaranteed undisturbed rest (8 hours) for employees working in unassigned pool freight service (possibly extending to other classes of service) after completing service and going off duty at home terminals, expanded use of assigned service (predictable work schedules), more accurate train line-up information for operating employees to facilitate better planning by employees of off-duty activities and anticipated work assignments, standards for availability for duty after being on leave, timely pick-up of crews who have worked maximum permissible hours, safety of vehicles used to transport train crews and limitations on duty hours of drivers, minimum standards for the safety and quality of crew lodging facilities, and limitations on maximum hours of continuous work by yardmasters.

The Guidelines permit each Committee to designate local work/rest groups to develop, prepare, and facilitate local work/rest initiatives and/or programs under the direction of the Committee. These local groups would operate under the same rules as the Committee.

The Guidelines were developed under the auspices of the National Wage and Rules Panel created in the parties' 1996 national agreements to provide a forum and process to expedite and enhance the opportunity for the parties to reach joint voluntary solutions to complex issues of mutual concern. They also provide for continuation of the National Panel to assist the various Committees by acting as a clearinghouse of information and data concerning fatigue in the workplace, and by continuing to review and study scientific research and developments on fatigue and work/rest issues. The parties are committed to making whatever modifications to the Guidelines that may be warranted on the basis of such information.

WORK/REST-GUIDELINES/PRINCIPLES

1. Coverage

The carriers represented before the National Panel established in accordance with the provisions of Article XIII of the May 8, 1996 Arbitration Award and Article XI of the May 31, 1996 Agreement and their employees represented by the United Transportation Union and the Brotherhood of Locomotive Engineers are covered by these Work/Rest Guidelines/Principles ("Guidelines").

II. Purposes and Principles

To meet the needs of rail service, many operating craft employees work highly variable duty schedules. The impact of those schedules on the employees' health, quality of life, and safety on the job, and implementation of appropriate corrective measures, are prominent issues facing the railroad industry today. Recent sleep research counsels that irregular work schedules may disrupt natural human sleep-wake cycles in certain circumstances, which could result in the potential for disrupted, shortened and poor quality sleep and, in some cases, reduced alertness and fatigue on the job.

The parties believe that management and labor should join in a mutual effort to review the relevant scientific research in this area and to facilitate implementation of validated countermeasures that will minimize the likelihood of fatigue while at the same time addressing related quality of life issues.

The purpose of these Guidelines is twofold. First, to encourage the dissemination of information concerning the science of fatigue and effective countermeasures. Second, to establish within a specified time frame programs designed to deal with the cause of fatigue in the rail industry and work/rest issues. The parties intend this to be a continuing undertaking and therefore view this as an ongoing effort that will be amended from time to time.

These Guidelines create processes to accomplish various changes that are designed to enhance rest opportunities for employees. The parties believe that these enhanced rest opportunities will address fatigue-related concerns more effectively and should reduce the need for employees to seek rest opportunities by marking off. The parties mutually recognize that railroad employees have always taken seriously their obligation to take advantage of rest opportunities and are confident this will continue to be the case. The parties also agree that the economic factors involved in providing service should not increase, taking into account operational benefits expected to be obtained as a result of changes implemented under these Guidelines.

Finally, the parties agree that the following principles should guide the design and implementation of all undertakings pursuant to these Guidelines:

· work rule accommodations - where and to the extent necessary, existing work rules may be changed to accommodate and facilitate changes implemented under these Guidelines; and

· the overarching objective of these Guidelines is to achieve meaningful progress in addressing fatigue issues by mutual and cooperative actions; if and to the extent that particular initiatives do not prove effective, it is our mutual intention that the parties work together to devise mutually agreeable corrective actions, rather than rely upon traditional claim and grievance process.

III. Work/Rest Committee

A Work Rest Committee (the "Committee") shall be established on each carrier within 45 days from the date of these Guidelines. The carrier and the organizations shall each appoint its respective representatives on each Committee. The compensation and expenses of each Committee member shall be borne by the party appointing them. Membership on each Committee will include, to the extent possible, representatives with knowledge and experience in all of the various disciplines involved in the study of fatigue and its effects. The carrier and labor members of each Committee, in their respective collective groups, shall have an equal vote on any Committee action pursuant to these Guidelines.

IV Initial - Education and Training Program.

1 . Each Committee shall be responsible for developing an education and training program covering all employees represented by the organizations and appropriate carrier/management personnel. The program will include, as appropriate, the use of videotapes, books, informational brochures, group presentations, and other materials useful for understanding and explaining the effects of fatigue and possible corrective measures.

In developing such proposals, each Committee shall:

(a) build upon and incorporate any existing or related programs in place on that carrier;

(b) review and consider the scope and content of such programs as may exist on other carriers;

(c) review and consider scientific literature regarding fatigue and appropriate operational responses; and

(d) review and consider information, findings and results made available from the rail management/labor Work/Rest Review Task Force.

V. Other Immediate Tasks

Each Committee shall within six (6) months from the date of these Guidelines develop a program, and within nine (9) months of the date of these Guidelines shall implement the initiatives as set forth below in conjunction with and subject to the approval of the designated labor and management representatives on that

carrier.

Each Committee may designate local work/rest groups to develop, prepare and facilitate local work/rest initiatives and/or programs under the direction of such Committee. It is recognized that variations in operating and other conditions may well lead to the development of different programs from one region or territory of a carrier to another. When local work/rest groups are established, they shall assume the same obligations, responsibilities, and time constraints applicable to the Committee established on that carrier.

A. Assigned Work Days/Rest Days

Work schedules consisting of assigned work days and predictable rest days will be made available to extra and pool employees working in unassigned freight service to the extent practicable. The number of assigned work days and rest days should be based on operational feasibility and other appropriate criteria, including, but not limited to, the lengths of the crew district and the mix of assignments- which an extra board protects. Employees who are provided regularly assigned rest days pursuant to this Paragraph shall not be required to work on such rest days, but may voluntarily elect to do so, subject to fatigue and rest Guidelines to be developed by each Committee.

B. Minimum Undisturbed Rest

An employee working in unassigned pool freight service will be provided 8 hours of undisturbed rest at his home terminal subsequent to completing service and being released from duty. Undisturbed rest will be measured from the time the employee goes off duty. Calls involving instructions for reporting to duty will not be authorized during periods of undisturbed rest, except in recognized emergencies. Any Committee may agree to extend application of this provision to other service. Any resolutions hereunder will comport with the applicable collective bargaining agreement and the Hours of Service Act.

C. A.M. Mark-Ups

When employees working, in unassigned freight service return to service after being on compensated leave for 72 hours or more, they shall not be considered available for duty earlier than 7:00 a.m. local time on the first day back.

D. Assigned Service

Each Committee shall review the operations of the carrier for the purpose of determining whether greater segments of the operation can be run on an assigned basis, as opposed to unassigned or pool service. Experiments designed to increase the percentage of operations in assigned service shall be encouraged. Each Committee shall make a detailed account of its findings and recommendations for increasing assigned service operations after completing such task.

E. Transportation

Timely Pick-up/Safe Vehicles - The carrier will make diligent efforts to anticipate crew tie ups en route for the purpose of arranging timely transportation service to the crews outlawed by the Hours of Service Act.

In addition, all new or renewed contracts with transportation service providers shall address the matters of periodic safety inspections of vehicles, limitations on the number of hours that vehicle drivers may operate such vehicles, and federal, state and local licensing and regulatory requirements. Finally, a toll-free hot line will be provided train and engine service employees in order to report transportation problems.

F. Lodging Facilities

Minimum standards as to quality and safety of location shall be maintained, consistent with the current applicable collective bargaining agreement(s).

G. Line-Ups

Recognizing that work/rest issues are affected by the accuracy of information on train lineups, each Committee will explore and recommend appropriate steps to improve such information.

H. Yardmasters' Hours Worked

A maximum number of continuous hours that will be worked by yardmasters when not restricted by the Hours of Service Act will be established.

VI. Review

At the end of six months of operation, each Committee shall review and assess the impacts of the program(s). It may recommend revisions, amendments or extensions of the program(s) (or elements thereof) based upon its findings. It shall also develop a plan to extend the program(s) (in whole or part), where and as appropriate, to additional portions of the system. Finally, each Committee shall be required to submit to the National Panel a detailed accounting of its findings within thirty (30) days after the end of each six (6) months of operations.

VII. Conflicts

If during the operation of any programs hereunder, a dispute arises involving the rules described above or an alleged conflict between existing rules and practices and the processes described above, the dispute shall promptly be referred to each Committee for resolution. Each Committee shall have exclusive Jurisdiction over any such dispute, subject to the provisions of Article VIII, C.

In resolving the dispute, each Committee shall attempt to interpret conflicting provisions in a manner that preserves the essential purpose of each rule or practice. In addition, each Committee shall consider on the one hand the adverse impact on the affected employees' ability to obtain proper rest, the employees' quality of life, and the employees' earnings as they relate to existing rules, practices and programs under these Guidelines, and on the other hand the service demands confronting the carrier, the need to create scheduling arrangements which maintain the ability of the carrier to meet day-to-day demands of service, and the carrier's need for the flexibility to utilize operating employees outside the normal schedule when necessary.

VIII. Responsibilities of the National Panel

The National Panel shall:

A. Continue its study of fatigue and work/rest issues and the responses thereto for the purposes of determining whether existing or newly-developed scientifically validated data justify additional provisions or modifications to the working conditions identified in this document;

B. Act as a clearinghouse of information with respect to fatigue and provide such data to the committees. As part of this obligation, it shall dialogue with scientists or groups of scientists expert in this subject that its members mutually agree upon;

C. Act as a facilitator with respect to any submitted to by a Committee; and

D. Act as a reviewing body of the reports and findings submitted to it pursuant to Article VI above. IX General The foregoing Guidelines reflect the parties' decision that the way to pursue resolution of fatigue-related problems is through good faith arms-length collective bargaining.

SIGNED THIS 1 8th DAY OF MARCH, 1999.

March 18, 1999 Side Letter #1

Dear Messrs. Little and Monin:

This refers to the Work/Rest Guidelines/Principles ("Guidelines") of this date. A question has arisen as to whether a new Work/Rest Committee must be established where a committee has already been established on a carrier that is charged with carrying out substantially similar responsibilities. In that situation, the parties may agree that the existing committee will serve as the Work/Rest Committee referred to in the Guidelines. Furthermore, where certain responsibilities of the Work/Rest Committee identified in the Guidelines have already been carried out, such responsibilities will be considered as having been fulfilled.

If this meets with your understanding, please sign in the space provided below.

Very truly yours,

/s/ R. F. Allen

I agree:

March 18, 1999 Side Letter #2

Dear Messrs. Little and Monin:

This refers to Article I of the Work/Rest Guidelines/Principles ("Guidelines") of this date. The Guidelines by their terms cover all carriers party to the May 8, 1996 Arbitration Award and the May 31, 1996 Agreement . However, the parties confirm that the discussions that led to these Guidelines occurred in the context of fatigue and its effects as encountered on Class I railroads. While fatigue and the effects thereof are legitimate concerns throughout the industry and hence are not limited to Class I railroads, the parties realize that the occurrences of fatigue and the manner of responding to it may differ significantly on a Class II or III carrier.

Therefore, upon the request of any Class II or III carrier or organization party to these Guidelines, the National Panel is prepared to review the terms of the Guidelines for the purposes of determining whether such Guidelines should be revised, and, if so, in what manner, because the Guidelines do not respond to fatigue and its manifestations as it occurs on such Class II or III carrier.

If this meets with your understanding, please sign in the space provided below.

Very truly yours,

/s/ R. F. Allen

I agree:

March 18, 1999 Side Letter # 3

Dear Messrs. Little and Monin:

This refers to Article I of the Work/Rest Guidelines/Principles ("Guidelines") of this date. The parties mutually recognize that the science of fatigue continues to evolve and have committed to taking appropriate measures where warranted by validated scientific findings.

If this meets with your understanding, please sign in the space provided below.

Very truly yours,

/s/ R. F. Allen

I agree:

March 18, 1999 Side Letter # 4

Dear Messrs. Little and Monin:

This refers to Article VII of the Work/Rest Guidelines/Principles ("Guidelines") of this date.

That provision provides exclusive jurisdiction to each Committee over certain disputes described therein. The parties are in agreement that any other dispute relating to the interpretation or application of these Guidelines, including the authority of any Committee established pursuant to the Guidelines to pursue an issue, or whether the process established therein was followed, shall be resolved in accordance with and pursuant to the peaceful procedures of the Railway Labor Act.

If this meets with your understanding, please sign in the space provided below.

Very truly yours,

/s/ R. F. Allen

I agree: