May 17, 2002
ALL BMWE MEMBERS
Dear Brothers and Sisters:
I am sending this letter as part of my commitment to fulfilling the mandate of Resolutions 29 and 50 from our last Grand Lodge Convention held in Montreal, Quebec, concerning potential merger partners with the BMWE.
As most of you are aware, Resolutions 29 and 50 passed unanimously at our last Grand Lodge Convention mandating that we seek a merger with a union. The clear call of Resolution 50 says:
"RESOLVED, That the delegates to the BMWE instruct President Fleming and the Grand Lodge Officers to make intense efforts to merge, affiliate, and/or federate with one or more of the signatory unions, ..."
With regard to the foregoing, I am in receipt of a letter dated May 8, 2002 from "Members against an unnecessary Grand Lodge Dues increase," signed by over 50 system division and federation officers of the BMWE. These officers requested that I convene the Grand Lodge Officers for the purpose of reopening negotiations with the International Brotherhood of Boilermakers, Iron Ship Builders, Blacksmiths, Forgers and Helpers (IBB). These same system officers relate that they took this action as result of receiving numerous requests from their local lodges and members.
You will see from the attached letter, that certain members of this unofficial committee met with IBB representatives and learned that the Boilermakers International is willing to make substantial changes to the original proposed merger agreement that was rejected by our membership in 2001.
The issues discussed by that committee, which the Boilermakers are agreeable to address are as follows:
Implementation of the Boilermakers, Blacksmiths National Pension Trust with up to 15 years past service credit for each member and the successful recent negotiation of this plan by the IBB along with the right of any rail union who merges with the IBB to be covered under the plan with the nation’s major railroads.
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Potential savings in our National Health Plan by implementation of the Boilermakers Health & Welfare Plan for our members as a result of the recently negotiated side letter between the IBB and the nation’s major railroads. This potential benefit is subject to further discussion and negotiation with the railroads.
Funding for BMWE Division — The Boilermakers will draft a new side letter (number 23) to guarantee essential and necessary operational funding of the BMWE Division and those functions set forth in Paragraph 4(b) of the Merger Agreement.
BMWE Division Secretary-Treasurers paying dues — The Boilermakers will draft a new side letter (number 24) to exempt BMWE Secretary-Treasurers from the payment of monthly dues.
Communist Party (Canada only) — The Boilermakers will draft a new side letter (number 25) to exempt Canadian members from Article 17.1.3 and Article 27.1 of the Merged Organizations' Constitution.
Disbandment of Local Lodges with fewer than 35 members — The Boilermakers agrees to amend Paragraph 17 of the Merger Agreement to include "Disbandment" thereby guaranteeing that lodges within the BMWE Division will not be disbanded simply because they have fewer than 35 members.
In addition to the foregoing, I am attaching a copy of a letter dated May 10, 2002, addressed to me as President of the Brotherhood of Maintenance of Way Employes from Charles W. Jones, International President of the IBB. As you will see from this letter, staff members, who serve on the Boilermakers merger committee, representing President Jones met with the committee of BMWE System Officers for the purpose of discussing the BMWE-IBB merger. The BMWE committee made it clear that these were informal discussions and they were not representing the Grand Lodge or the BMWE.
The letter goes on to say that the IBB advised the committee that if the merger between the BMWE and IBB takes place, it will not be necessary for the BMWE Division to raise their dues at our forthcoming convention. Also, that the Boilermakers International is in excellent financial condition and that they do not need nor want the BMWE members to increase their dues as part of the merger process. In fact, they plan to remit back additional money to the System Divisions and Federations and the Local Lodges.
The letter further advises that the IBB has reached an agreement with the railroad industry on implementation of the Boilermakers-Blacksmiths National Pension Trust and will be submitting same to their membership for a vote in the very near future. That pension not only applies to the Boilermakers members, but also would apply to any organization (including BMWE) that merges or affiliates with the IBB. And there would be no need to serve a Section 6
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notice to negotiate same. This agreement will provide participants a supplemental pension in addition to Railroad Retirement and an opportunity to draw a pension that is equivalent to 51.5% per year of the total amount of 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 for the rest of his life, based on a 75 cents per hour carrier contribution. (The amount of the carriers’ contribution is subject to negotiation with the carriers.) The carrier would have only contributed $750 on the employee's behalf.
If that same employee had 15 years of past service credit, 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 an 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 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.
The Boilermakers pension is one of the best plans in the U.S. labor movement. A similar plan with comparable benefits is available for our Canadian members. However, these plans are only available if we merge with the Boilermakers as the BMWE has no such plan to offer our
members, no such agreement with the carriers, nor do we have the financial resources necessary to start such a plan.
A second side letter to the agreement concerns a Boilermaker-Blacksmiths National Health and Welfare Trust as a provider of health and welfare benefits for members employed in the railroad industry in the United States. That side letter also contains a provision which allows any organization that merges or affiliates with the IBB to participate in the health and welfare trust under the same terms and conditions as ultimately available to all IBB members employed in the rail industry, covered by national negotiations. We would expect this to generate a savings in the amount our U.S. members pay toward their health and welfare benefits, both now and into the future. Dependent upon further discussion with the railroads, it opens the door for possible lower health care costs for BMWE members.
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Obviously, their are numerous advantages for the BMWE membership by returning to the bargaining table and having a discussion with the International Brotherhood of Boilermakers. I would be remiss if I, as your President of the BMWE, ignored the potential advantages that may be available to BMWE members. That is why I called a conference of the Grand Lodge Officers to consider reopening merger discussions with the Boilermakers.
I discussed the two attached letters with our Grand Lodge Officers in telephone conferences held on May 13 and 15, 2002. After full discussion with the Grand Lodge Officers, they voted to reopen negotiations with the Boilermakers.
I know that some will disagree, particularly those who opposed the merger with the Boilermakers in 2001. However, this is not about the merger agreement in 2001. This is about a different agreement, one that provides substantial changes and increased benefits for the membership over the proposed merger agreement that was narrowly lost in the referendum vote in 2001.
Because we are so close to the Grand Lodge Convention, it will be difficult, but I will try to keep you apprised of any developments as far as the reopened discussions between the BMWE and the IBB. At the same time, I want you to know that our staff is already stretched beyond normal because of the preparations that are necessary for holding our Grand Lodge Convention as scheduled in Las Vegas, Nevada for July 8-12, 2002.
Concerning the ongoing discussions with the United Steelworkers of America — while those merger discussions have not, as of this letter, been fruitful, — there is nothing in the decision of the Grand Lodge Officers and the petition from the system officers to prevent us from bargaining with the Steelworkers. We will continue to explore that avenue as a potential merger partner in order to obtain the best merger result possible for the membership.
I look forward to reporting to you on the progress in these negotiations no later than the opening of our Grand Lodge Convention in Las Vegas on July 8, 2002. I want to thank you for your attention to this very important matter. I also look forward to meeting with all of your elected delegates in what will certainly be one of the most important Grand Lodge Conventions we have ever held.
With best wishes, I am
In solidarity,
(Signed) M. A. Fleming
President
Attachments - You will need Adobe Acrobat Reader to see attachments - merger.att
cc: Grand Lodge and System Officers