Bargaining Update: February 2017 "Latest Proposal"

Published: Feb 17 2017 12:58PM

On February 7, 2017, the BMWED-SMART/Mechanical Bargaining Coalition presented a new bargaining proposal to the railroads in an effort to reach a voluntary agreement.  The essence of our February 7, 2017 proposal is:  

1) General wage increases of a net annual increase of 3.3% per year over the term of the contract; 
2) No change to the employee monthly cost-sharing on healthcare ($228.89);
3) Improved dental and vision benefits; increased amounts of active life insurance coverage as well as increased amounts of accidental death and dismemberment coverage and off-track vehicle coverage;
4) Improved away from home expenses (meals, lodging, headquarter and travel allowances); increased paid time off (vacation and personal days as well as lowered eligibility requirements for qualifying for vacation);
5) Lowered service requirements for February 7, 1965 Employee Protections (5 years of service instead of 10);
6) Health and welfare plan design changes involving increased physician and prescription drug co-pays, increased deductibles, coinsurance and out-of-pocket maximums and a re-bid of the network providers for the entire Plan. 

The total net yield of our proposal is $32,986 when applied to the weighted average BMWED hourly rate of pay.  The actual yield will be more or less based upon your rate of pay and the amount of overtime worked.  The details of the February 7, 2017 bargaining proposal can be found here.

To avoid radical plan design changes proposed by the Carriers during this round of negotiations, the BMWED adopted a different strategy to healthcare bargaining focusing on more efficient and cost-effective administration of services.  We found over $100,000,000 in annual savings to the National Plan through that exercise.  We made our initial proposal in March of 2016, noting that it neither cost a single railroad employee or the railroads one cent more to maintain current level of health benefits.  Although the Carriers’ healthcare expert confirmed our findings, the Carriers  said that any voluntary agreement must include health and welfare benefit plan design changes.  Their position in this regard was enhanced by the November 2016 election results.

After the election, the railroads terminated negotiation conferences with the Coordinated Bargaining Group and the BMWED-SMART Mechanical Bargaining Coalition and requested mediation.  This moved us closer to presenting our case to a Presidential Emergency Board (PEB).  A PEB is appointed by the President and consists of three or more individuals who investigate the report and offer recommendations for its settlement.  History has shown that if the bargainers reject that recommendation and strike, its terms will be imposed by an Act of Congress.  In other words, once the dispute goes before a PEB, the parties lose effective control of how their bargain will be structured. Accordingly, reaching a voluntary agreement is rail labor’s best possibility to securing a respectable contract during this round of national negotiations.

To this end, on February 1, 2017, BMWED National Division Officers and the various participating System Division and Federation General Chairpersons gathered to discuss our next steps in bargaining.  They made the decision to present the February 7, 2017 bargaining proposal, as yet another attempt to reach a voluntary agreement that would result in a respectable amount of real wage increases in the pockets of membership, while avoiding a likely disastrous PEB.  Your National Division Officers and General Chairpersons are not alone in this decision.  Indeed, another rail bargaining coalition has reached the same assessment and is slated to present a similar wage raise and health and welfare benefit proposal that mirrors the BMWED-SMART Mechanical Coalition’s.  Once this is presented, over 40 percent of rail labor will be standing together at the bargaining table with regards to healthcare and wages.  This sends a clear and powerful message to the railroads that rail labor is serious about bargaining to reach a voluntary agreement, and that we are standing together.  

To date, the Carriers have not responded to our February 7, 2017 proposal.  We are scheduled to meet with the Carriers and the mediator on February 28th and March 1st.  We anticipate the railroads will respond to our proposal at that time.  We will continue to try to reach a voluntary agreement that provides good wage increases, improved paid time off, improved away from home expenses, improved job security and affordable health care benefits.  

I ask that each of you continue to urge your fellow union brothers and sisters to stay engaged with their union, and stay informed about bargaining.  I also ask you to encourage your fellow union brothers and sisters of different rail unions to stand with us on our bargaining proposal.

BMWED Proposal