Legislative Update December 2011

Tentative Agreement Reached in National Negotiations

Presidential Emergency Board 243 concluded its hearings on October 20 and issued its recommendations on November 5, 2011. The PEB report sent to President Obama included recommendations to resolve all issues in dispute over national wages, work rules, and health and welfare benefits between 11 rail unions and the nation’s largest freight carriers. This began another 30-day cooling off period for the parties to meet again to attempt to negotiate a voluntary settlement driven by the PEB’s recommendations. Shortly before the Thanksgiving holiday, the Carriers requested an extension to a 60-day cooling off period; however, the BLET declined to agree to the extension and the expiration of the cooling off period remained at 5:00 p.m. on December 5, 2011. In accordance with the provisions of the Railway Labor Act, the parties would at that time again be free to seek self help (strike or lockout). Also, Congress could intervene to legislatively prevent or stop self help by passing a law that forces the parties to accept the recommendations of the PEB as their settlement. That action, which could originate in either the House or the Senate, would require a majority by both chambers for passage and would be signed into law by the President.

In their presentations to the PEB, the Carriers took the position that the recently passed UTU agreement should be treated as a pattern in this round of negotiations. They maintained that record profits do not support wage increases for those who make those profits possible, claiming that future profit margins are at risk. With regard to health care benefits, the Carriers maintained that Rail Labor benefits are overly generous and they urged the PEB to shift the health care costs from the Carriers onto the backs of those who can least afford it—the oldest and least healthy workers and those with families.

Each of the unions in the two coalitions (the Coalition of Rail Unions and the Rail Labor Bargaining Coalition) presented argument, evidence, and testimony regarding craft-specific issues to the PEB. The BLET sought favorable PEB recommendations with regard to elimination of the entry rate and the two-tiered pay system; adoption of the away-from-home-terminal meal allowance that is part of the CSX agreement as the national standard; immediate increase of certification allowance to $10.00 per trip or tour of duty, with adjustments for future general wage increases; and improved and enforceable minimum locomotive cab stardards.

Rail Labor also presented joint argument, evidence, and testimony regarding wages, vacation, and health care benefits. The unions argued that continued record profitability and sustained productivity gains do justify wage increases greater than those agreed to during the last round of bargaining. They also requested a sixth week of vacation and proration of vacation for those who fail to qualify for the full allotment. On the issue of health care benefits, the unions requested that the PEB recommend no changes at this time.

In its report, the PEB recommended adoption of some of the Carriers’ request that the UTU agreement be followed with modifications to those terms that would give the employees represented by the other unions a more generous settlement. They recommended larger general wage increases as well as a lump sum signing bonus for all employees covered by the agreement rather than lump sums being paid to only those employees working under the entry rate progression, as agreed to by the UTU. With regard to health and welfare the Board recommended that the parties adopt all of the changes that were in the UTU agreement, with some variations. The Board recommended that the increases to coinsurance and deductibles be phased in over an 18-month period rather than immediately. For the craft-specific issues that were presented by the various unions, the Board suggested withdrawal for most and local handling for a few. The only BLET craft-specific issue that the Board did not recommend be withdrawn was the one for certification pay for the conductors it represents; however, it did not recommend adoption either. Instead, it referred that issue to on-property handling.

Following the issuance of the Board’s recommendations, President Pierce stated that those recommendations had placed the BLET and the Carriers at a point where they had to either reach a voluntary settlement or allow Congress to set the wages and working conditions for the members. He said that a voluntary settlement would be preferable to allowing a highly unpredictable Congress to take control of the dispute. He also pointed out that the only settlement available to the BLET included concessions on health and welfare benefits that the BLET has steadfastly rejected from the beginning.

Weeks of intensive negotiations ensued. During that time there were frequent contacts from the White House, the Secretary of Transportation, and leaders of both parties of the Senate and House of Representatives. On November 30 and December 1, President Pierce met with the BLET Advisory Board, the full National Wage Committee, and the General Chairmen representing every railroad involved in the dispute to review with them the Carriers’ final settlement offer. During those meetings, a consensus was reached to submit to the membership a Tentative Agreement, allowing the members to vote on whether or not to ratify that agreement. With regard to the Tentative Agreement, President Pierce pointed out the following three things: “First, the wage terms are reasonable, and on a par with the 2007 National Agreement. Second, we have taken steps to significantly mitigate the impact of the PEB’s health and welfare recommendations. And, third, you should be aware that Congress is poised to prevent us from making our stand on the health care question, because legislation already has been filed to impose the bare PEB recommendations — without the enhancements we have negotiated — before the cooling-off period ends.”

President Pierce also issued the following statement to the membership: “I promised you as recently as September that we would put every ounce of our energy into the fight, and I can assure you that my promise has been kept. We have left no stone unturned, we have played out every scenario, and we have tried to overcome every obstacle the Carriers — and the system — placed before us. You have truly received our best, and I thank you for your continuing support.”

As of December 5, General Chairmen in national handling have been provided a copy of the Tentative Agreement reached between the BLET and the National Carriers’ Conference Committee (NCCC). That notice additionally advised that the BLET and NCCC have also entered into an agreement voluntarily extending the status quo cooling-off period to accommodate the membership ratification process for the Tentative Agreement and that no order to strike would be issued. Members are urged to carefully review the terms of the Tentative Agreement and vote in a timely manner.

War on Workers

 

Good News from Ohio:  On November 9, Ohio voters rejected legislation that would have nearly eliminated collective bargaining rights for 360,000 public workers in that state. Ohio’s Issue 2, which resulted from SB 5, Ohio Governor Kasich’s signature issue to scale back collective bargaining rights for public workers, was defeated by a 61 percent majority. Had it passed, the measure would have banned strikes by public workers, removed binding arbitration, and eliminated union negotiations over health care and other benefits. Although this represents a hard-earned victory for labor, BLET President Dennis Pierce warned that the War on Workers is far from over. He stated that word is already out that Ohio Republicans are planning to re-introduce portions of Issue 2 again next year and that we need to remain vigilant in our efforts to oppose these anti-union measures.

Wisconsin Recall Election:  Elsewhere in the nation, plans are underway to recall Governor Scott Walker of Wisconsin, who initially waged the War on Workers earlier this year with his efforts to strip bargaining rights from state workers.United Wisconsin, a group collecting signatures to recall Governor Walker and Lieutenant Governor Rebecca Kleefisch, have reported that, as of November 30, volunteers have turned in 300,000 of the 540,208 signatures needed to trigger a recall election for the governor.

Amtrak Funding

Although Congress has been unable to agree on very much lately, they did reach agreement in mid-November on funding for Amtrak, bus transportation, commercial aviation, and transit through Sept. 30, 2012. The funding is for fiscal year 2012, which began October 1, 2011. For FY 2012, Amtrak will receive $1.4 billion, or $64 million less than it received in FY  2011. Of the 1.4 billion, $681 million is targeted for capital improvements.

On the plus side, Congress agreed to scrap an earlier House effort to eliminate the use of federal dollars for 26 state-supported Amtrak routes, which help fund some 150 regional passenger trains serving nine million passengers annually. However, funding for high speed rail was eliminated from the budget. President Obama had proposed $3.6 billion for higher-speed rail for FY 2012, and $53 billion over six years. The budget deal also requires Amtrak to impose overtime limits on employees and does not allow the railroad to offer discounts over 50% on normal peak fares.

Northeast Corridor Privatization Plan Scrapped

On November 8, John Mica (R-FL), Chairman of the House Transportation and Infrastructure Committee, stated that he would no longer push his controversial plan to privatize passenger rail on the Northeast Corridor, and agreed that reforming Amtrak would suffice. Although he did not announce or call for any additional federal funds, he did urge that any future high speed rail funds that are returned to the federal government be reallocated solely to the Northeast Corridor.