The Third Division consisted of the regular members and in addition Referee Gerald E. Wallin 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.
Although the wording of the Statement of Claim suggests routine bridge maintenance, the record establishes that the core focus of the dispute was the use of two crack repair technologies, i.e., epoxy injection to fill small, hairline-type cracks nd pressure grouting to fill cracks and voids exceeding one-half inch.
It is undisputed that the Carrier provided notice of its intent to contract out the overall project work involving eight concrete and/or stone bridges by letter dated May 18, 2004. A conference was held on May 18. Correspondence following the conference notes that the Carrier's intention to contract the work was based on the lack of skills and equipment to perform the crack filling. In addition, it is undisputed that the Carrier's forces were fully employed on other projects throughout the construction season and the work needed to be completed before the end of the season.
The Organization's alleged that the Carrier did not make a good-faith attempt to reach an understanding concerning the notice. It cited the so-called Form 1 Award No. 40800
Berge-Hopkins December 11, 1981 Letter of Understanding (LOU) in support of this allegation.
The LOU expresses a general assurance that carriers will make good faith efforts to reduce subcontracting and to use employees ". . . to the extent practicable, including the procurement of rental equipment ...." for operation by the employees. Other than the rental equipment reference, the letter provides no standards for determining where the line of practicality is to be drawn or, in other words, what is "practicable." It is, therefore, a general statement of aspiration without meaningful guidance.
It is well settled that specific provisions in an agreement must prevail over other general provisions when an interpretation is required in arbitration to resolve a conflict between them. The parties' Agreement contains a relatively specific Scope Rule 1 (B). It reads, in pertinent part, as follows:
The foregoing excerpt from the Scope Rule reveals that it provides five specific exceptions to the prohibition on contracting out work identified in its first paragraph. Significantly, it grants an exception when specialized equipment is not owned by the Carrier. There is no requirement that the Carrier seek to rent equipment before it may avail itself of the exception.
It is undisputed in the record that the Carrier did not own any epoxy injection equipment or any pressure grouting equipment. Moreover, it is further undisputed that the Carrier's employees had never performed epoxy injection. While they likely could have acquired such skills in time, they did not possess the skills to do epoxy injection at the time of the Carrier's notice and its subsequent decision to contract out the work.
In light of the foregoing considerations, we are compelled to find that the Carrier did not violate the general guidelines of the LOU because the specific terms of Scope Rule 1(B) override it. The record does not establish any other basis for the Organization's allegation in Section (2) of its Statement of Claim. As a result, this portion of the claim must be denied.
The lengthy record before the Board contains many assertions and rebuttals by both parties. It also contains some evidence that is relevant to the issues before us and some that is not. In addition, we have noted some material in the parties' Submissions that was not exchanged during the development of the record on the property. We excluded such material, as we must, from our analysis of the record.
As previously noted, Scope Rule 1(B) establishes five situations in which the Carrier is entitled to contract out work that may otherwise be reserved to its employees. Our review of the relevant evidence establishes that the work in question required special skills not possessed by BMWE-represented employees and special equipment not owned by the Carrier. Given the existence of these factors, Scope Rule 1 permitted the Carrier to contract out the work as it did. Because the disputed work formed the core of the project in controversy, we find no language in Form 1 Award No. 40800
Scope Rule 1 that required the Carrier to piecemeal the project. Accordingly, the claim must also be denied on its merits.
This Board, after consideration of the dispute identified above, hereby orders that an Award favorable to the Claimant(s) not be made.
LABOR MEMBER'S DISSENT
TO
AWARD 40800, DOCKET MW-39039
(Referee Wallin)
In this case, the Majority committed a cardinal sin. It did not simply consider a new argument never advanced during the handling on the property, but instead went one step further and raised a new argument sua sponte. Then, to add insult to injury, the Referee answered the contract interpretation question he posited for the Carrier in a manner that was: (1) in conflict with well-reasoned precedent on this property; (2) in conflict with the Referee's own prior awards; (3) in conflict with the plain language and bargaining history of local Rule 1B and the national December 11, 1981 Berge/Hopkins Letter of Agreement; and (4) in conflict with fundamental logic. The result is an award that is not only at odds with nearly 30 years of local and national precedent, but also without any reasonable foundation. Inasmuch as the precedential value of awards is directly related to the quality of reasoning in the awards, Award 40800 should be treated like the anomalous outlier that it is and afforded no precedential value.
The first and most fundamental problem with this assertion is that the Carrier did not at any time during the handling of this case on the property argue that there was a conflict between Rule 1 B of the local agreement and the national December 11, 1981 Berge/Hopkins Letter. The Carrier did raise the argument that the Berge/Hopkins Letter was no longer in effect (a truly frivolous argument that has been rejected in dozens of awards), but it never asserted a conflict between the local and national rules and it never, not once, asserted that local Rule 1 B was specific while the Berge/Hopkins Letter was general. Instead, the Majority for the first time in the history of the dispute posited a conflict between local Rule 1B and the national Berge/Hopkins Letter and then resolved the purported conflict by applying the specific versus general principle, a position never taken by the Carrier during the handling on the property (or even in its submission). Thus, the Majority didn't simply violate the Labor Member's Dissent to
procedural prohibition on the introduction of new issues, it went a step further, a big step, when it acted as an advocate for the Carrier and raised the new issue sua sponte. In addition to the obvious violation of the Board's rules and procedures, this was grossly unfair to the Organization. Indeed, the Organization was unable to respond to this new issue even during oral argument because there was no indication that this issue was being considered until it appeared in Award 40800. Moreover, if the issue had been raised on the property and the Organization had been afforded a fair chance to respond, it would have been able to handily demonstrate that there was no conflict between Rule 1 B in the local agreement and the national Berge/Hopkins Letter, as we shall demonstrate below.
Award 40800 is hardly the first time a Section 3 panel has been required to interpret the relationship of Rule 1 B in the local C&NW Agreement and the national Berge/Hopkins Letter. To the contrary, in a contracting out dispute that arose in 1984 on the former C&NW property, the Carrier asserted "... it had right to subcontract the work in question in accordance with the provisions of Rule 1, as it does not possess the special material and equipment required to perform this work on the scale involved in the instant case." That dispute was submitted to Public Law Board (PLB) 2960 and decided by Award No. 136, which held:
It is transparently clear that the Carrier never argued that there was a conflict between local C&NW Rule 1 and the national Berge/Hopkins Letter and the Board did not find any such conflict. Rather, the Board clearly read the special equipment exception in the local rule and the subsequent national rule requiring good-faith efforts to lease equipment to be in perfect harmony. There was no dissent filed in connection with Award No. 136 of PLB 2960.L
Three years later in 1987, another contracting dispute arose on the C&NW property which required the interpretation and application of local Rule 1 B and the national Berge/Hopkins Letter. In that case, the Carrier once again defended its actions by asserting it did not have the necessary equipment as contemplated by Rule 113. In Award 153 of SBA 2960, Arbitrator Vernon ruled as follows:
There was no dissent filed to Award No. 153. Therefore, it is crystal clear that at the time the national December 11, 1981 Letter of Agreement was negotiated and integrated in the local C&NW Agreement, neither the Carrier, the Organization or the Neutral Member of PLB 2960 (the standing Board the parties established to resolve contract interpretation disputes arising under the C&NW Agreement) believed that there was any conflict between the Berge/Hopkins Letter and Rule 1B. To the contrary, those provisions were read in harmony, with the national rule modifying the local rule just as all national rules modify the local rules on related subjects. Indeed, that is the purpose of national multiemployer bargaining in the railroad industry. Thus, it was nothing short of an egregious error for the Majority in Award 40800 to determine, sua sponte, some 30 years after the fact, that there was a conflict between C&NW local Rule 1B and the national Berge/Hopkins Letter.
In addition to being in conflict with well-reasoned awards on the C&NW property, the Majority's decision is in conflict with prior awards rendered by this Referee. In Award 35337, this Referee set forth the analytical framework for integrating the national December 11, 1981 Berge/Hopkins Letter and existing local rules which permit contracting out under certain circumstances:
It is transparently clear from Award 35337 that this Referee understood the integration of the national December 11, 1981 Letter and equipment exception rules in existing local agreements in precisely the same way that Referee Vernon understood them on the C&NW property. That is, this Referee expressly stipulated that the December 11, 1981 Letter of Agreement, "... created new Carrier commitments that limited existing rights, if any, to contract out Scope covered work. ***" (Emphasis in bold added), and that, "*** the Letter of Agreement requires the undertaking of good-faith efforts to use Carrier forces and equipment, or rent such equipment, before resorting to previously existing rights to contract out Scope covered work. ***" There was simply no basis for concluding otherwise in Award 40800 and we are simply stunned not only that the Referee did so, but doubly stunned that he did so sua sponte.
In addition to positing the general versus specific issue sua sponte, the Referee also gratuitously characterized the Berge/Hopkins letter as "*** a general statement of aspiration without meaningful guidance." (Award at P.3). This characterization, also raised sua sponte, is not only in conflict with the plain language of the Berge/Hopkins letter, but runs directly contrary to the Referee's prior findings in Award 29912 where he held:
It simply can not be disputed that in Award 29912 this Referee held that the Berge/Hopkins Letter enshrined express contractual obligations to make good-faith efforts to reduce subcontracting and provided a monetary remedy when the carrier failed to present evidence that it "... undertook the requisite good faith efforts to which it was committed." There is simply no logical way to square this finding with his gratuitous characterization, some 30 years after the fact, that the Berge/Hopkins letter was merely "aspirational". Moreover, Award 40800 not only contradicts prior awards by the Referee, but conflicts with dozens of other awards which have sustained contracting claims based on the failure of carriers to comply with their good-faith obligations pursuant to the Berge/Hopkins Letter (e.g., see Third Division Awards 26072, 26770, 29121, 29158, 30944, 35957 and Award 33 of PLB No. 6204). Labor Member's Dissent to
CONFLICT WITH
THE CLEAR LANGUAGE
AND BARGAINING
HISTORY
Rule 1 B was negotiated by BMWE Vice President O. M. Berge in the local C&NW Agreement effective August 1, 1974. Some seven (7) years later, that same O. M. Berge, who had been elected President of BMWE in the interim, negotiated the December 1 1, 1981 National Agreement, including the December 11, 1981 Berge/Hopkins Letter. By its plain terms and the fundamental principle of national bargaining, the Berge/Hopkins Letter modified the existing rights to contract in the local rules of all Carriers party to the 1981 National Agreement, just as this Referee correctly explained in Awards 29912 and 35337. The Carriers' obligation to lease equipment, enshrined in the Berge/Hopkins Letter, contains no exception for "special equipment". Consequently, there is no conflict between local Rule 1 B and the Berge/Hopkins Letter that would require resolution by the application of the special versus general language principle. Indeed, in the 30 year history of the Berge/Hopkins Letter, not a single Carrier in the nation has asserted that there is a conflict between existing rights in local agreements that permit contracting out that requires special equipment and the new restrictions on those rights in the Berge/Hopkins Letter. Consequently, there was simply no rational basis for the Majority in Award 40800 to posit such a conflict sua sponte some 30 years after the fact.
CONFLICT WITH
LOGIC AND REASON
There are no agreements that permit contracting simply because the Carrier does not own the equipment routinely used by the BMWE craft. Indeed, such an exception would render the agreement meaningless because the Carrier could eliminate the craft by simply selling its equipment or allowing its inventory to expire through attrition (See Awards 6905, 10229, 19657, 20090 and 20372). Instead, whether by practice or rule, existing local agreements with equipment exceptions permit contracting when the Carrier does not own "special equipment" [e.g. C&NW Rule 1 B, UP Rule 52, BN Rule 55 and Soo Line Rule 1(c)]. Consequently, under the Majority's sua sponte theory in Award 40800 that the Berge/Hopkins Letter does not apply when special equipment is involved, the result would be that the obligation to lease equipment set forth in the Berge/Hopkins Letter has virtually no application and is essentially a meaningless clause. That is simply not a logical or reasonable conclusion.
The Majority's finding in Award 40800 is based upon new argument that the Majority injected into this case sua sponte. For that reason alone, Award 40800 should not be afforded any precedential value. But beyond that procedural point, Award 40800 is not simply wrong, but profoundly wrong. It is in conflict with: (1) well reasoned precedent on this property; (2) the Referee's prior awards; (3) the plain language of Rule 1 B and the Berge/Hopkins Letter; (4) the fundamental principle of national bargaining; and (5) logic and reason. And, as if that weren't enough, the theory the Majority manufactured from whole cloth (i.e., that there is a conflict between the Berge/Hopkins Letter on the one hand, and existing local rules which permit contracting that requires special equipment on the other) is a theory that has never - not once - been advocated by any carrier in the 30 year history of the Berge/Hopkins Letter. For all of these reasons, I vigorously and emphatically dissent.