Bargaining Update: March 16, 2017 "Carriers Still Going Backward"

Published: Mar 16 2017 3:18PM

National Mediation Update -- March 16, 2017
Carriers still going backward

Mediation resumed Tuesday, March 14, 2017 for the BMWED-SMART/Mechanical Bargaining Coalition and the National Carrier’s Conference Committee (NCCC).  

On February 27, 2017, the railroads made a regressive and disrespectful proposal (previously posted on BMWED’s website LINK).  The railroads stated their offer was based upon their reappraisal of the strength of the rail industry, claiming that between the time of their original September 14, 2016 proposal and present (and future), rail earnings appear sluggish.  During the March 14th mediation session, BMWED-SMART/Mechanical Coalition’s economist provided a presentation that demonstrated -- on the contrary -- that the railroads had faired very well during the last quarter of 2016.  The presentation also established that all economic indicators lead to strength and growth for the railroads in 2017 and beyond.  Nevertheless, the railroads advised that their regressive proposal was based upon their belief that railroad workers’ wage increases from 2005 through 2015 exceeded inflation.  You can find the document that the carriers provided about wages HERE and provided below.

The railroads stated that they simply could not continue to have voluntary national agreements with wage packages that outpace inflation and market growth, and that have healthcare benefits at their current level.  They further stated that outside industries have contract settlements for wages increasing at 2% per year and health benefits that are significantly worse than railroad workers.  In other words, the railroads continue to believe that we make too much money and our benefits are too rich, despite the railroad’s continued profitability. (Note that CSX is willing to pay one man over $300 million to become CEO, you don’t bet that large a sum on a business that doesn’t have a robust future.) 

The BMWED/SMART-Mechanical coalition took exception to the railroads’ arbitrary cherry-picked 2005-2015 time period to support their position.  As noted by the coalition’s lead negotiators, railroad workers endured various concessions – agreed to and imposed – in years prior to 2005.  If the railroads are serious that the 2005 to 2015 time period is relevant, critical years prior to 2005 would be relevant to provide a fuller and more accurate depiction of real wage growth for railroad workers.  Trying to “take a second bite at the apple” by attempting to negotiate lower wage increases in this round, in order to recapture wage increases from the last two rounds of national negotiations, is a far-reach and not within rail industry norms and ignores the parties’ bargaining history since deregulation in 1980.  

“All railroad industry employees want the railroads to be very profitable, but, all railroad employees should be fairly compensated for their work,” said BMWED President Freddie Simpson after the latest round of talks.  “To say railroad workers make too much money and have too good of benefits is insulting - especially when railroads’ profits are considered, and when compared to their executive compensation and share holder returns over 2005 – 2015.  But now that we know the railroads are looking at outside industries as comparison for their proposed settlement agreement, our experts can do research and examine these settlements.  This will take time and more face-to-face discussions to work through. The BMWED-SMART/Mechanical Coalition will continue our efforts to reach a voluntary agreement that produces real wage gains and maintains quality healthcare for railroaders and their families, and that is relevant to the rail industry.”  

Mediation is scheduled to resume on April 6th and 7th.  Further information will be forthcoming as bargaining develops.

"HANDOUT March 14, 2017 Mediation Session LBI on behalf ofBMWED/SMART-M"