Labor Talks: A Headache But Never a Bore

Written by Frank N. Wilner, Capitol Hill Contributing Editor
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WATCHING WASHINGTON, RAILWAY AGE MARCH 2022 ISSUE: “The farmer and the cowman should be friends,” wrote Rodgers and Hammerstein for the 1943 musical, Oklahoma! In 1967, Aretha Franklin recorded R-E-S-P-E-C-T. Five gets you 10 that neither friendship nor respect exist at the bargaining table where rail management and labor have been negotiating contract amendments since January 2020.

Most Class I railroads and many smaller ones are negotiating with 12 labor unions. Talks now guided by the National Mediation Board (NMB) likely will continue through 2022. Rail labor contracts remain in force until voluntarily or third-party amended.

Blame delay and some unpleasantness on COVID-19, forcing video-conferencing rather than face-to-face bargaining sessions more conducive to building trust. 

Core quarrels concern Precision Scheduled Railroading (PSR)—an operating plan to do more with less; headcount reductions; worker availability and discipline policies; unpredictable work schedules; the impact on revenue from declining coal traffic; pricing power threatened by regulatory activism at the Surface Transportation Board; and the funneling since 2010 of $183 billion to stockholders through dividends and share buybacks—perceived by labor as lavish profitability rather than reduced incentive to reinvest. 

Labor wants a 40% wage increase through July 2025, citing the highest consumer price inflation in four decades. Rail worker compensation—now averaging $96,000—already tops 94% of the domestic workforce. 

Another squabble is healthcare benefit reform. Rail workers enjoy generously low copays and deductibles, make no contribution toward dental and vision care, and pay under $230 monthly for a family plan—just 12% of its costs. 

Contributing to sour moods is the carriers’ desire to operate—on Positive Train Control (PTC) equipped routes—engineer-only, where one conductor and one engineer now are required by contract. PTC is a $13 billion, labor supported, crash-avoidance safety overlay system to eliminate human-factor-caused train accidents. 

“Everybody has a plan until they get punched in the mouth.” —Mike Tyson

A 2021 court-ordered arbitration panel ruled minimum crew size be negotiated railroad-by-railroad rather than in national negotiations as preferred by carriers. A promising starting point for either might be a failed 2014 attempt by BNSF, which proposed a higher-paid “master conductor”—redeployed from the locomotive cab to a ground-based position—and income protection to retirement age for adversely affected conductors. 

Labor’s hopes for government-mandated two-person crews are on life support. A coveted Federal Railroad Administration (FRA) two-person crew mandate was withdrawn after the White House Office of Management and Budget deemed it overreach—the FRA later determining “no regulation of train crew staffing is necessary or appropriate for railroad operations to be conducted safely at this time.” The FRA said it had no factual evidence to support a minimum crew-size mandate.

The California Public Utilities Commission found “a second set of eyes provides only minimal safety improvement.” Los Angeles Metrolink found two-person crews “can have an unintended contrary effect on safety due to potential for distraction.” The National Transportation Safety Board voices no opposition to engineer-only where PTC is operational. Amtrak and commuter railroads, plus short lines and regionals—and many railroads globally—operate safely with one-person crews. 

Attempts to legislate two-person crews failed even when labor-friendly Democrats controlled the House and Senate. While some states have legislation requiring two-person crews should carriers force contractual changes, the 1970 Federal Railroad Safety Act requires rail safety laws be uniform nationally, with the Supreme Court saying states lack authority to regulate interstate traffic. 

Meanwhile, rivalry exists between the Brotherhood of Locomotive Engineers and Trainmen (BLET) and the Transportation Division of the Sheet Metal, Air, Rail and Transportation Workers (SMART-TD), representing conductors. In 2001, the BLET unilaterally agreed to engineer-only operations on regional Indiana Rail Road, and has in place, on BNSF, an agreement to boost engineer pay when conductor jobs are abolished. 

Notably, if a Class I railroad unilaterally pulls conductors from trains, but continues paying them—despite current contracts requiring two-person crews—binding arbitration will follow, with history recording that negotiated agreements are preferable to third-party determinations. SMART-TD would be wise to negotiate nationwide blanket conductor protection.

Railroad labor/management relations may be headaches galore, but never a bore. To predict an outcome is to ignore former professional boxer Mike Tyson’s advice: “Everybody has a plan until they get punched in the mouth.”

Frank N. Wilner

Capitol Hill Contributing Editor Frank N. Wilner is author of six books, among them Amtrak: Past, Present, FutureUnderstanding the Railway Labor Act; and Railroad Mergers: History, Analysis, Insight, all published by Simmons-Boardman Books. Publication of his seventh book, “Railroads & Economic Regulation,” is pending by Simmons-Boardman Books. Wilner earned undergraduate and graduate degrees in economics and labor relations from Virginia Tech. He has been Assistant Vice President, Policy at the Association of American Railroads; a White House appointed chief of staff at the Surface Transportation Board; and director of public relations for the United Transportation Union. He is a past president of the Association of Transportation Law Professionals. Wilner drafted the railroad section of the Heritage Foundation’s Mandate for Leadership (Volumes I and II), which were policy blueprints for the two Reagan Administrations; and was a guest columnist for the Cato Institute’s Regulation magazine.

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