The Third Division consisted of the regular members and in addition Referee Joan Parker when award was rendered.
The Third Division of the Adjustment Board, upon the whole record and all the evidence, finds that:
The carrier or carriers and the employee or employees involved in this dispute are respectively carrier and employee within the meaning of the Railway Labor Act, as approved June 21,1934.
This Division of the Adjustment Board has jurisdiction over the dispute involved herein.
The Carrier owns and operates 157 miles of line in Texas, between Corpus Christi and Laredo. Several years prior to the events at issue herein, the Carrier employed approximately 40 Maintenance of Way (MOW) workers. Over the years, that number declined to 19, which the Carrier believed to be sufficient to perform all necessary MOW work on its line, which handled low density traffic. Subsequently, the Kansas City Southern Railway (KCS) acquired a majority ownership interest in the Carrier, and the Carrier became part of a larger rail network allied with Canadian National Railway and intended to reap the benefits of the passage of NAFTA by establishing a Canada to Mexico freight rail corridor. When evaluated in this context, it became clear that the Carrier's 157 miles of line required major refurbishing and rebuilding in order to handle anticipated high density traffic.
In relation with these efforts, the Carrier issued notice to the Organization on May 31, 2000, of its intent to contract out work specifically described to include rail replacement on the curve at Mile Post 108. The notice stated:
The Organization contends that between October 16 and December 12, 2000, a contractor performed rail installation at the curve at MP 108, using two Foremen, one Welder, one Machine Operator and seven Laborers, and using an ordinary backhoe and hand tools. It is the Organization's position that such work is reserved to MOW employees under Rule 1 (Scope) and Rule 2 (Seniority) of the parties' Agreement. The Organization further argues that MOW employees have customarily and historically performed such work. According to the Organization, at the June 12, 2000 conference with the Carrier in which the work at issue was discussed, the Organization presented evidence that adequate Carrier forces and equipment were available to perform the work in question. The Carrier presented no evidence that the routine maintenance the Claimants were scheduled to perform during the claim period could not be rescheduled, the Organization asserts, and thus the Carrier's mere assignment of the Claimants to other work did not make the Claimants unavailable for the work. In addition, the Organization contends that the Carrier is obligated to manage its work force to ensure adequate size to perform necessary work, and cannot justify contracting out on the basis of its own lack of managerial foresight.
The Organization challenges the Carrier's characterization of the work as "time sensitive" or urgent. According to the Organization, the Carrier presented no evidence that Carrier forces could not complete the work within the necessary timeframe, or indeed, ever defined what the necessary timeframe was. The Organization further argues that the Carrier presented no evidence that it had an insufficient equipment inventory to perform the work, and that even if it had, the Carrier had an obligation to lease additional equipment under the terms of the December 11, 1981 Letter of Understanding. The Organization contends that the Carrier failed to meet its duty of good faith under the December 11, 1981 Letter of Understanding, alleging that at conference, Carrier representatives failed to provide specific information regarding the Form 1 Award No. 37992
work to be performed and the need to contract it out. The Organization also asserts that the Carrier created its own "emergency" by severely reducing its workforce, leading to track deterioration from deferred maintenance.
The Carrier counters that the work is not contractually reserved to MOW forces. According to the Carrier, Rule 1 governing Scope is general in nature. The Carrier argues that it is a well-established principle that where a Scope Rule is general - as here - the Organization bears the burden of demonstrating entitlement to the work by presenting evidence that MOW forces have performed such work in the past to the exclusion of others. The Carrier asserts that the Organization has not met this burden. While the Carrier does not deny that its MOW forces have performed rail installation work, the Organization failed to present any evidence that they have performed such work to the exclusion of others, or that work of the magnitude involved in the instant case has historically and customarily - or indeed, ever - been performed by MOW forces. The only evidence presented by the Organization to support its allegation that MOW forces have performed such work comprises two employee statements that fail to describe the amount or magnitude of the work performed.
The Carrier further contends that even assuming areuendo that the Organization had proved that such work was contractually reserved to MOW forces, the Carrier was explicitly permitted to contract out the work under Rule 29, after providing the Organization 15 days' notice and discussing the matter in conference at the Organization's request. According to the Carrier, the work at issue could not be performed by the Carrier's regular forces, who were fully employed on other scheduled work or otherwise unavailable for service. While the Organization asserts that the Carrier should not have reduced the size of its force to 19, the parties' Agreement places no restriction on the Carrier's managerial prerogative to determine the size of its regular force, and it is not obligated to maintain additional employees as a contingency for special and/or unforeseen work projects such as that involved in the instant case.
With regard to the Organization's arguments relative to the December 11, 1981 Letter of Understanding, the Carrier questions whether that the Letter of Understanding applies to Rule 29, which was agreed to in 1982. Assuming areuendo that the Letter of Understanding does apply, however, the Carrier contends that the Organization was provided every opportunity at conference to convince the Carrier that outside forces were not necessary. According to the Carrier, the December 11, 1981 Letter of Understanding's requirement of a good faith attempt to reach an understanding does not require Carrier capitulation to the Organization's position. Form 1 Award No. 37992
Moreover, under the Letter of Understanding, equipment is to be leased where practicable, which it was not in the instant case, where no employees were available to operate such leased equipment. The Carrier further argues that many of the instant claims are duplicative of claims already before the Board.
The Board finds that the Organization failed to meet its burden of showing entitlement to the tie installation work at issue. The Organization's argument that Rules 1 and 2 contractually reserve such work to MOW forces is without merit. Neither Rule reserves specific work to MOW employees. Rule 1 governing Scope is general in nature, and the Board has found numerous times that under such a general Scope Rule, in order to prevail in a contracting out claim, the Organization must present evidence that MOW forces have performed the contracted-out work in the past to the practical exclusion of others. In the instant case, while the Organization presented two employee statements that the employees had performed rail installation work in the past, the Organization has not provided any evidence that work on the scale of that at issue here - part of a major rebuilding project - had ever been performed by the Carrier's regular forces, much less historically and customarily, or to the practical exclusion of others.
Moreover, even assuming areuendo that the Organization had proved reservation of the work to MOW employees,. Rule 29 nevertheless permits the Carrier to contract out such work provided that certain requirements are met. First, the work must "be of such nature that it cannot be performed by the regular forces." It is unrefuted that all 19 Carrier employees were fully occupied by their regular job duties or otherwise unavailable for this rail installation project. It is a matter of logic that Carrier forces could not simultaneously perform their regular duties and the largescale project completed by the contractor between October 16 and December 12, 2000. The work was not the routine maintenance and repair normally performed by regular MOW forces. Rather, it was part of a special project undertaken to correct serious defects and upgrade the Carrier's line to meet the needs of high density traffic that it had not previously handled. The Organization offered no evidence to support its naked assertion that such work could have been performed by the Carrier's regular forces, or its allegation that the Carrier created the urgency of the situation by reducing its forces so that track deterioration resulted from deferred maintenance.
Rule 29 also requires the Carrier to provide the Organization 15 days' notice of its intent to contract out work, and make a good faith effort to reach an understanding with the Organization regarding the contracting out. It is undisputed that the Carrier Form 1 Award No. 37992
provided timely notice to the Organization and met promptly with the Organization to discuss the matter at the Organization's request. The Organization's argument that the Carrier failed to make a good faith effort to reach an understanding at conference is unpersuasive. The Organization has not pointed to any concession that the Carrier could have feasibly made to satisfy the Organization in the instant case. The Carrier's regular forces were fully employed. Even assuming arguendo that necessary additional equipment could have been leased, it is unrefuted that the Carrier had no regular employees available to operate such equipment. Similarly, assuming arguendo that the December 11, 1981 Letter of Understanding is applicable in the instant case, the Carrier met its obligations thereunder and the Organization has simply not shown any practical alternatives to the contracting out at issue here.
The Board notes that an analogous case involving these same parties was presented in Third Division Award 37008, (in fact, involving many of the Claimants in this claim) with respect to tie installation work from June 19 to August 16, 2001 on the Carrier's line between San Diego, Texas, (MP 107) and Bruni, Texas, (MP 49). In that case, the parties' positions were virtually identical to those taken in the instant case. The Board in Third Division Award 37008 found: