Information & Rebuttal of Myths and Outright Lies, Generated by Another Labor Organization

Brothers & Sisters, the following information is provided to you to help in making your decision about how you're going to vote on the proposed contract.

I am attaching the NCCC’s Section 6 Notice for your review.

NCCC Section 6 Notice

As the railroad industry enters the 2010 round of national bargaining, the nation continues to endure the most severe economic downturn in many decades. The railroads and their employees have not been spared from the effects of that economic turmoil.

Substantial and sustained traffic declines have forced railroads to reduce their workforces and cut back spending on infrastructure and equipment acquisitions. The industry is also confronted with other significant and pressing challenges. The legal and economic regulatory environment governing railroad industry pricing and services is being actively reexamined by Congress, raising concerns and uncertainty as to the potential effects on our business model and future prosperity. Recent legislative mandates like Positive Train Control and new locomotive emissions controls will require massive additional investments in the coming years.

The significant impact of these Issues underscores and reinforces the more fundamental and persistent challenges we can and must mutually address at the
bargaining table to help ensure that the railroad industry not only survives, 'but prospers in the years ahead. Our focus must be external-what must we do to ensure that our customers receive excellent service at competitive prices. To obtain and retain business, we must. consistently deliver value. Our compensation and benefit costs must match the marketplace-pay at above-market rates or for unproductive time makes us less competitive. We must be able to utilize our employees and our assets as flexibly and efficiently as possible. Anachronistic work rules and practices that hinder our ability to give customers high quality, cost-effective service or which add unnecessary costs must be reformed.

To meet increased demands for rail freight service, the industry will need to invest tens of billions of dollars in new track, signals, bridges, tunnels and service facilities. The funds needed for those massive capital investments will not flow into the industry, however, unless railroads consistently deliver excellent financial results. Investors demand competitive returns, and will take their money elsewhere if we cannot meet their expectations.

In the end, the security and prosperity of the entire rail community-labor and management employees, their families, and our retirees-rests squarely on sustained
success in the marketplace. A more secure future in an industry that can provide stable employment and attractive pay and benefits is within our grasp if we join in doing whatever it takes to be competitive. This new bargaining round presents us with a fresh opportunity to lay the foundation for the industry'S continued success for many years to come.

Set forth below are the railroads' bargaining proposals.

Compensation and Wages: Provide for a compensation package that fairly reflects economic conditions, the general labor market, and the competitive transportation marketplace, taking into account existing wage and benefit levels. Adjust wages and pay as necessary to achieve a fair and competitive cost structure. Develop compensation arrangements that reflect the risks and rewards of the business enterprise, while linking pay to productivity and performance.

Health and Welfare: Modify Plan design and funding responsibilities so that employees (a) bear a share of the ever-increasing cost of healthcare for employees and
their dependents that is more representative of comparable U.S. industry norms, (b) tailor their use of Plan benefits and programs to optimize receipt of efficient, clinically appropriate, and cost-effective treatment, and (c) are encouraged (along with their dependents) to adopt a healthier lifestyle.

Work Rule Reform: Eliminate or revise as necessary work rules that interfere with or inhibit the railroads' ability to provide customers with high quality, cost-effective service, which impede productive utilization of employees, or which prevent the railroads from utilizing the most efficient and cost-effective way to perform necessary work.

Employee Availability: Implement measures reflecting mutual commitment to ensure railroads' ability to meet customer service and operational requirements and
provide equitable distribution of time off for the entire employee population, while reducing the amount of time employees are unavailable for service.

Workforce Stability: Institute processes and structures that will effectively provide for more predictable work/rest schedules and systematic movement to and from assignments (including a more orderly and efficient means of effectuating the exercise of employees' seniority rights), improve retention, and enhance employee quality of life while increasing safety and efficiency.

Staffing and Consolidation: Explore opportunities for mutually beneficial alternatives to existing staffing models that enhance safety and productivity, fairly address employee interests and concerns, and recognize the unique opportunities still available to the parties to negotiate meaningful changes.

Miscellaneous Proposals. Reach mutual understanding on an agreement of sufficient duration to facilitate labor stability and predictability that includes provisions
assuring complete labor peace during the moratorium period. The railroads will provide more specific and detailed proposals on these and related changes as discussions proceed during this round of bargaining.

As you will see from their notice, they are requesting relief in many areas of our agreements, including reduction in wages. Ratification of the proposed agreement will save us from that big fight over changes in work rules and reduction in pay.
It was also later asked what pay codes will receive GWI increases. It is difficult to produce an exhaustive list. Just understand that anything that was increasable in the past will remain increasable with this agreement. Frozen pay elements from the 1986 National agreement will remain frozen. On the other hand, the basic day, over miles, SPD, certification pay, and meals at the AFHT are increasable as well as anything else that is paid in miles at the daily rate, i.e. late lunch in yard service, 15 minutes for GN preparatory time or 30 minutes for inspecting a consist not in connection with your own assignment.

It was also asked if the GCA could provide some explanation about the difference in GWI’s between the 2008 NS agreement and the 2009 BNSF agreement. It is difficult to compare the agreements between these two properties because neither one has patterned itself after the other over the years. We looked at the NS agreements dating back to 1996 and note that they received 10.5 % in GWI’s in their 1996 Agreement, but also received $15 and 15 cents (frozen) for each working trip on the basic day and over miles, respectively, as a resolution to the certification and crew consist disputes. This amounted to about an additional 10% raise (basic day was approximately $150 in 1996). BNSF on the other hand received 10.5% in GWI’s, $5.00 for certification pay, and $27.00 and $18.00 for SPD and started getting paid for territorial qualification. It is hard to place a total GWI value on the certification pay and SPD because some of the money in the SPD was already being paid to engineers (no fireman pay and crew consist money), but was frozen and we stood to loose much of our short crew pay because part of it was going to attrite when we received personal leave days and those were a part of the 1996 deal for both NS and BNSF. NS received 6% in GWI’s in 2003, began getting paid weekend differentials worth $30 per trip (increases to $45 in 2010) and established trip rates later. BNSF received 9.5% in 2003 and received additional compensation for post 85 engineers through trip rates (value unknown). In 2007, BNSF received 17% in GWI’s through 2009. In 2008, NS received 18% in GWI’s through 2014. BNSF is voting to accept 11% in GWI’s through 2014. Since 1996 to the present, including the agreement being ratified, BNSF engineers will have received 48% in GWI’s through 2014, established cert pay and SPD, territorial qualification money and potential for 8% profit sharing, added a employer 401K contribution and a sixth week of vacation. NS over the same time period has received 35.5% in GWI’s, plus rolled it’s $15/.15 into its basic day and over miles (10% more in GWI’s), received shift differential, added a potential for 3% in 401K matching money and participate in a potential of 15% in profit sharing (goal sharing like on BNSF). It should also be noted that the NS profit sharing and 401K match is tied to attendance. To qualify for a potential 10% payout or to receive the full match, an engineer must work 220 or 235 starts each year, depending on the service. To qualify for a potential 15% payout or to receive the full match, an engineer must work 248 or 260 starts, depending on the service. Bottom line, it appears that both railroads have paid engineers comparably during this time period. We have just moved the money around differently. I am attaching the NS agreements for your review.

It is important to add that if this proposal fails ratification, we will be done with on-property handling. Our future contract will be settled at the national level and we will be in handling with the engineers on UP who have not enhanced their agreements in decades because they have been unsuccessful in on-property negotiations over the years. They really want to use this round as an opportunity to rectify what some of them see as inequities between BNSF and UP agreements. Also, in all likelihood, the NCCC will focus on relaxation in work rules and adjustments in pay, but more troubling, we will probably not have any opportunity to add a second week of single day vacation, a sixth week of vacation, a fix to demote force assignment problem or a 401K employer contribution. These were issues specific to our property and the engineers on the UP are still looking for just profit sharing and an updated scope rule, let alone all of the other enhancements that we have received in our agreements since 1996. This isn’t to slam the engineers on UP. They have a very difficult management team to deal with. This just needs mentioning, because this situation will be in play if we choose national handling.

One final note - anyone who keeps up with current events will notice that this Nation is in the midst of one of the worst recessions since the Great Depression. The unemployment rate is officially 10.2%, but if one factors in those who've given up looking, or run out of benefits, or have taken a lesser paying job, that figure jumps up to 16.6%. Here we are presented with an offer of 11% wage increase over the life of the contract, while millions of those around us are either without a job, or facing pay cuts and hours cuts. We don't have to worry about National handling, and we walk away with stuff with no give backs. The door will be opened for future vacation increases and matching fund increases. If we go the route of national handling, there won't be any relief for those being force assigned every week. I've included the NCCC (the bargaining arm for the railroads) Section 6. As you can see, they are asking for give backs up the wazoo. For those of you who don't quite understand corporate speak, here's what they want:

Reduce the wages
More burden on the employee regarding H&W
Relax work rules
One man crews
Mandatory Attendance
Modify the bump rules to require near instantaneous placement
The inability to go on strike if not satisfied, or if the contract expires without a new one.
 

The General Chairman of another Organization felt the need to involve himself (and his members) in our business by blasting our proposal. Here's what he had to say:

All,

I recently received word (not from BLET or BNSF) that the BLET has reached a tentative “on-property” wage and rules settlement with BNSF. Attached are scanned copies of the proposal and all relevant material that is being distributed with it. I am certain that you will be receiving calls regarding this and wanted you to have a copy of the documents. I would also like to bring up a few talking points that may be helpful when responding to these inquiries.

First, the proposal provides for an 11% GWI over the next 5 years. It is “weighted” on the far end so their first GWI on 1/1/10 is only 1 percent. The BLET cover letter accompanying these documents states that a “pattern” has already been set for the next round by a similar agreement between the BLET and CSXT. However, we must note that the CSXT agreement provides for a 16% increase over the next 5 years. The attached proposal is also void of any COLA increases once it expires.

There is a provision in this proposal wherein BNSF engineers will receive matching contributions to their 401(k) (not beginning until March 1, 2011) the equivalent of ¼ of 1 percent of their previous years’ earnings. While it may indeed be termed a matching contribution, doing the math reveals that this is hardly worth the cost of pencil and paper used to calculate it. For example, if an engineer has earnings of $80,000 in the previous year, the Carrier is only obligated to contribute $200 into their account. In addition, only earnings while working in the engine service craft are used in the calculation.

Finally, the proposal provides that engineers who qualify for a vacation and have 25 years of service will be afforded 6 weeks of vacation per year. Be sure to point out that this does not change or increase the amount of weeks employees are afforded prior to 25 years of service but only provides an extra week for those with 25+ years.

From our perspective, there is no current indication that BNSF has any intention of bargaining “on-property” with UTU. I am inclined to believe that the current BLET negotiations on BNSF are a by-product of their 2007 property agreement wherein agreeing to operate engineer only. There is little need to make any further rules concessions at this time since they have already agreed to work with only 50% of the existing work force.

Rather, BNSF intends to negotiate through national handling and I anticipate they will attempt to seek rules and wage concessions if we are not agreeable to providing relief from our existing crew consist agreements. The burden is once again left with UTU to try and maintain our present crew staffing levels. It is unfortunate that so many operating employees that continue to remain in the work force at this time, do not recognize the fact that the only reason they are working is by virtue of UTU agreements. Ironically, many of the employees presently in ground service are members of the BLET and oblivious to the fact that their dues money is being utilized to secure agreements wherein contractually recognizing that these ground positions are not needed.

Randy K

First, no one knows why this General Chairman is obsessed with BLET agreements, but I guess if you don't have one to offer your members, you might as well take cheap pot shots at those who do. Let's show the myths and outright lies this memo contains:

First, this General Chairman is angry because we were able to negotiate an agreement and he can’t get a deal done. It’s ironic however, because truth be known, he was offered a deal just before the recession hit. That deal would have actually guaranteed jobs to all trainmen for the rest of their lives! But he wouldn’t take the deal and unfortunately nearly 2,700 trainmen are now unemployed because of him.

This General Chairman wants people to believe that we sold the trainmen’s job with that agreement. Nothing could be further from the truth. He knows that better than most people. How many times did he say during the recent ebb and flow debacle that he started that the his Organization owns complete jurisdiction over all matters pertaining to trainmen, including entrance into their craft. There is no dispute here. It is understood. It is also understood that he has the complete and total responsibility to secure and protect the future of the employees that he represents. It’s not us who hold jurisdiction over them. We do not have a dog in that hunt and we cannot help him in that matter. That’s his job alone.

On the other hand, we always have and we always will continue to support a 2-man crew regardless of his belligerence toward us, but those in his committee should really take a hard look at what value he brings to them, and to labor in general in light of his irresponsible and ill advised recent behavior.

To address his misrepresentations below,

First the CSXT agreement only had 11% in GWI’s after subtracting the 5% which was carried over from their 2007 agreement. In addition, he missed the fact that we have rolled back the contract cycle by 6 months. Our previous contract cycles have run from July to July. If we had remained in that cycle, we would have received a 2% GWI in July of 2010, but we will receive a 1% GWI on January 1, 2010 because we are receiving the GWI’s ½ a year early. He is correct that we did not reintroduce the Harris COLA into our contract. Why would we want to after we fought so hard in the last round to eliminate it? We had to use ½ our Harris COLA’s to pay for the yearly increases in our health and welfare premium.

Second, we have not said that the company is providing a 401K match, it is an employer contribution of ¼ of 1% of an engineer’s regular earnings plus profit sharing during the yearly measurement period. Obviously, we cannot include earnings when engineers may be cut back and working as trainmen because, as we have said, we do not have jurisdiction to enter into an agreement covering trainmen’s pay and this General Chairman would certainly raise a stink if we tried.

To his final point, we did only add a 6th week, but younger engineers should benefit from this more in the long run than older engineers. Many older engineers have already missed the value of the 6th week as they near retirement, but all of the younger engineers will enjoy the 6th week, each and every year after they have reached 25 years of service.

To sum things up, it is evident that this General Chairman has sour grapes, but he has crossed the line when he came out to publicly criticize our product. It’s obviously more than he has brought to his members. If he is so sure that we have done a disservice than why doesn’t he go get something better? Until then, I suggest that he keeps his nose out of our business and stop spreading lies for his political agenda.

What those people are missing is the fact that our contract cycle has ran from July to July and we are backing up the contract to January. If we had stayed in the July to July cycle we would have received a 2% GWI on July 1st, but by backing up the contract, we received our general wage increase 1/2 a year early which caused the increase to be 1/2 as much. The 4.5% GWI on July 1, 2009 was supposed to cover the period through June 30, 2010. Also, the 6th week of vacation has a relative value of a 1% GWI, making the total value of the January 1, 2010 raise to be equal to a 3% GWI.

The question is raised about the CSX agreement, compared to ours. Here are the highlights of their agreement

The enhancements in the CSX contract were reached in a previous agreement this past year when three former properties on CSX consolidated their 
former schedules. That is when they got a 6th week of vacation and they have to work 30 years before they get it.  We have not changed any of our 
rules except for fixing the demote force/release problem and we have not made any concessions in our deal.  Also, NS reached its deal prior to the 
recession.  A NS engineer in through freight makes $194.93 and a yard engineer is paid $205.16.  All special allowances like certification pay are 
rolled into their basic day and over mile pay.  BNSF through freight engineers are paid $191.10, plus 38.16 (SPD) and 5.23 (Cert. pay) for a total of 
$234.49.  NS engineers average an additional 7.43% in bonus money for a total of $209.41 in through freight service.  BNSF engineers have 
averaged 7.34% in profit sharing for a total of $251.70 in through freight service.  

Well, there you have all the information. This would be the first time in many years we would have an agreement before going without one for 2-3 years. This means the monies would be working for us from day 1, not three years later, when we have to give up half of the retroactive wages in taxes. As for the 1%, remember we are already increased for the first 6 months of the first year by the 4.5% increase we got in July. Finally, there are no give backs. No work rules changes, except the one we wanted. We'll have our foot in the door as far as more vacation & matching funds.

What has the other Organization reaped lately?

Are we better off going the National Division route?? Think it over.