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President’s Panel Makes Recommendations in Railroad Dispute

November 14, 2011

Thanks to increased productivity, technological advances and the rising popularity of freight services, major railroad companies are enjoying historic profits – even as the U.S. economy struggles through a multi-year recession.

Despite their record-breaking success, the biggest companies are demanding concessions from workers, including the nearly 6,000 employees represented by the IBEW.

Ongoing contract disputes between 12 unions and the nation’s freight rail carriers passed a milestone Nov. 5, when a special panel appointed by President Obama made recommendations in an attempt to form the framework to resolve the parties’ disagreements.

The Presidential Emergency Board heard parties’ proposals for settlement and issued a report recommending wage increases and changes to the employees’ health and welfare plan.

The board recommended a 15-percent wage increase over five years.  It’s a modest increase over the carriers’ offer, but significantly lower than the package proposed by the unions. The board’s recommended changes to the benefits package – which is in line with the carriers’ proposals – threaten to hurt working families, IBEW Railroad Department Director Bill Bohné said:

The nation’s freight carriers are prosperous and profitable, yet they are proposing a shift in health care costs from the railroads to their employees. They have always asked us to make concessions when times were tough, but now that they have improved their bottom line, they asked the Presidential Emergency Board to deny our members the right to share in their prosperity.

 

In the late ‘80s and early ‘90s, when the railroads were having financial problems, general wage increases were forgone for three years. It was a shared sacrifice. Now, when times are good, they’re shifting even more costs onto the backs of the workers who helped create the record profits.

Bohné joined other labor leaders who testified at a board hearing in October. He called for the carriers to enhance vacation week allotments that have remained unchanged for nearly 30 years. While the unions’ requests are modest and would bring vacation qualification time in line with that of railroad management, says Bohné, the railroads, led by the National Carriers’ Conference Committee, comprising large companies like CSX and BNSF, continue pushing for major concessions. He said:

This is the same pattern we’re seeing nationwide. Companies are sitting on piles of money while employees work harder and harder for a decreasing part of the pie. We see it with large corporations like Verizon, and unfortunately the railroads are no different.

The parties now enter a 30-day cooling off period as the sides attempt to reach a final settlement.

The IBEW is part of a six-union group called the Coalition of Rail Unions (CRU) which resumes bargaining Nov. 10. Fellow unions in the coalition are the American Train Dispatchers, the Brotherhood of Railway Carmen, the Machinists, the Transportation Communications Union and the Transport Workers.

Other unions involved in industry-wide negotiations are part of the Rail Labor Bargaining Coalition, which includes the International Brotherhood of Boilermakers and Blacksmiths, the Brotherhood of Locomotive Engineers and Trainmen, the Brotherhood of Maintenance of Way Employees, the Brotherhood of Railroad Signalmen, the National Conference of Firemen and Oilers and the Sheet Metal Workers union.

The members’ five-year contract expired January 1, 2010. Since then, employees have continued to work under status quo provisions while parties engaged in bargaining sessions. If a solution is not reached by Dec. 6, three options are possible. The unions could strike, the railroads could impose their proposed changes on the workers, or Congress could step in and settle the dispute while considering the findings of the presidential commission.

But Congress would not be bound by the report’s recommendations – a fact that Bohné says could be to the detriment of workers:

Given the current political climate, getting an agreement that is fair to our members could prove very difficult. It’s possible that lawmakers, especially those who display hostility to working families, could scrap the recommendations and impose agreement terms that would be far worse for our members. I don’t think [Senate Minority Leader] Mitch McConnell or [House Speaker] John Boehner care very much about hard-working Americans getting a fair contract.

 I am hopeful that we will reach a decent settlement.  Both parties have a lot to lose in either a strike or a settlement mandated by Congress.

To view the Presidential Emergency Board’s report, click here. Scroll to page 87 to see the board’s full recommendations.

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