BMWE Merger News

A large committee consisting of Grand Lodge officers and staff and a number of General Chairmen met from April 2 through 5, 2002, with representatives of the United Steelworkers of America to pursue the possibility of a merger between the two organizations. The events leading up to this meeting were outlined in the March / April 2002 issue of the JOURNAL.

At the close of the meeting it was decided that in order to move the process forward, a smaller committee consisting of certain technical staff from both the U.S. and Canada would meet further with the Steelworkers. The smaller committee was directed to negotiate the best possible merger agreement which would then be brought back to the larger body for consideration.

The smaller committee met with Steelworkers representatives on April 17 and 18. On April 18, the Steelworkers declined to go further, citing the need for clarification of the BMWE’s financial structure as it is quite different from theirs. As this JOURNAL goes to print, the BMWE has furnished the Steelworkers all the additional information they requested and is awaiting a further response from the Steelworkers.

In other merger news, President Mac A. Fleming received a letter dated May 8, 2002, signed by over 50 system officers organized as a committee of "Members Against an unnecessary Grand Lodge Dues increase," (MAD) petitioning him to convene the Grand Lodge officers for the purpose of reopening formal merger negotiations with the International Brotherhood of Boilermakers, Iron Ship Builders, Blacksmiths, Forgers and Helpers.

In their petition, the MAD Committee stated that in accordance with Article XXIV, Section 14 of the Grand Lodge Constitution and Bylaws and "reacting to the inordinate number of requests by their respective members (both for and against the initial ... IBB merger proposal)," they met informally with IBB merger committee members on May 2, 2002, in Kansas City, Missouri. At the meeting the committee explored any continued interest by the IBB in a merger and their willingness to address remedies to the previous agreement.

The MAD Committee stated that the IBB expressed a strong desire to reopen negotiations with the BMWE and offered to make amendments to the initial merger agreement that would enhance the possibility of acceptance. These amendments would include a guarantee of essential and necessary operational funding of the BMWE Division; BMWE Secretary-Treasurers exempt from paying dues; a guarantee that BMWE lodges would not be disbanded simply because they have fewer than 35 members; and exempt Canadian members from Constitutional articles dealing with the Communist Party.

The MAD Committee advised that it "made no attempt whatsoever to portray itself as a group authorized to negotiate on behalf of the Grand Lodge and the IBB was acutely aware of this unauthorized position from the initial contact." However, the Committee said, it was their opinion "that we would be remiss in our duties as leaders of our respective [System Federations and Divisions] if we did not make every effort to explore mergers in accordance with the Convention Resolutions [Nos. 29 and 50]."

Shortly thereafter, President Fleming received a letter from Charles W. Jones, IBB International President, dated May 10, 2002, confirming the facts outlined in the MAD Committee petition and noting that the Committee "made it clear that these were informal discussions and that they were not representing the Grand Lodge."

Jones reiterated that the IBB was still interested in a merger, that they were prepared to address all of the issues discussed with the MAD Committee, and furthermore, that if a merger takes place, it will not be necessary for the BMWE Division to raise their dues. "As you know," Jones said, " the Boilermakers International is in excellent financial condition and we do not need nor do we want your members to increase their dues as part of the merger process."

In addition, Jones noted that IBB recently reached an agreement with the railroad industry on implementation of the Boilermaker-Blacksmith National Pension Trust. (As this JOURNAL went to print, the Boilermakers were in the process of finalizing the agreement language and preparing to submit the agreement to their membership for a vote.) A significant side letter to the agreement allows any organization that merges or affiliates with the Boilermakers to participate in the Pension Plan without the need of serving a Section 6 notice. "This Merger Agreement affords, for the first time, an opportunity for your members to participate in a private National Pension Plan," Jones said.

This agreement will provide participants a supplemental pension in addition to Railroad Retirement and will give them the opportunity to draw a pension that is equivalent to 51.5% per year of the total carrier contributions made during the time the employee worked for a participating carrier.

An employee working as few as 1,000 hours in a plan year, who then retires with as little as five years of past service credit with a participating employer at the time the plan is implemented, would be eligible for a pension benefit of $69.69 per month or $836.28 per year based on a 75 cents per hour carrier contribution. (The amount of the carriers’ contribution is subject to negotiation with the carriers.) If the same employee had 15 years of past service, he would be eligible for a monthly benefit of $144.69 or a yearly amount of $1,736.28. In less than six months he would draw back all that had been contributed on his behalf.

If the same employee had worked 10 years with 15 years of past service credit, he would have a benefit of $782 per month or $9,384 per year; working 15 years, the benefit would be $1,116.75 per month or $13,401 per year; and working 20 years would generate a monthly benefit of $1,451.50 per month or $17,418 per year.

These amounts are calculated on straight time hours with no overtime. Working overtime would generate a higher retirement benefit.

Another side letter contains a provision which would allow any organization that merges or affiliates with the Boilermakers to participate in the Health and Welfare Trust under the same terms and conditions as might ultimately be available to Boilermakers’ members. "This opens the door for possible lower health care cost for our railroad members," said Jones.

President Fleming convened a telephone conference of Grand Lodge Officers on May 13, 2002, to discuss the petition received by the MAD Committee. A motion was made that the original BMWE Merger Committee meet with the Boilermakers for the purpose of trying to negotiate clarifications and improvements in the original tentative agreement. If the Committee is able to reach a revised tentative agreement, then such tentative agreement is to be returned to the Grand Lodge Officers for their consideration and handling. This motion was passed in a telephone conference on May 15, 2002.