PARTIES TO DISPUTE: (
FINDINGS:
AWARD
ORDER
Third Division Award 45225; Docket 45973
Third Division Award 45226; Docket 46072
Third Division Award 45229; Docket 46222 And
Third Division Award 45233; Docket 46310 (Referee Melinda Gordon)
In issuing these decisions, the Board found procedural errors in the Carrier’s contracting notices, because the “anticipated work date” did not match the actual work dates. These cited Awards are not only palpably erroneous, but more so, are flagrantly fashioned and contrived by the Board based on ill-defined logic that the Carrier has no choice but to respond in dissent.
The Board has alarmingly raised concern with Carrier’s practices pertaining to its use of contractors for various work performed. As stated on record in each of the on-property handling documents in these cases, Appendix 8 of the South Agreement outlines the parameters that the Carrier must follow to contract out work. Appendix 8 reads as follows:
In the event a carrier plans to contract out work within the scope of the applicable schedule agreement, the carrier shall notify the General Chairman of the organization involved in writing as far in advance of the date of the contracting transaction as is practicable and in any event not less than 15 days prior thereto.
If the General Chairman, or his representative, requests a meeting to discuss matters relating to the said contracting transaction, the designated representative of the carrier shall promptly meet with him for that purpose. Said carrier and organization representatives shall make a good faith attempt to reach an understanding concerning said contracting, but if no understanding is reached the carrier may nevertheless proceed with said contracting, and the organization may file and progress claims in connection therewith.
LETTER OF UNDERSTANDING DATED SEPTEMBER 28, 1996
As seen from the clear, unambiguous text of Appendix 8, when the Carrier exercises its discretion to use contractors, it must simply inform the General Chairman, in writing, of its intent to contract out work in advance, as far as practicable, with at least 15 days’ advanced notice. After notice is given, if the General Chairman, or their representative, requests to meet with the Carrier to discuss the prospective contracting transaction, the Carrier is obligated to do so. Simply put, this concludes the requirements of the Carrier to contract out work. But, seeing as how the Board has failed to correctly interpret these parameters, a quick summation of the requirements is notated again, below:
In the cited Awards, the Board sustained the claims based on procedural objections raised by the Organization pertaining to the dates in which the contracted work actually took place. The rendered analysis by the Board is not only demonstrably incorrect, showered with misguided assumptions, but also fails to interpret and read the plain text language provided in Appendix 8. In these instances, the Carrier followed the parameters of Appendix 8. The Carrier notified the General Chairman, in writing, of its intent to contract work. The notices were subsequently conferenced with the General Chairman or his representative. In various instances, the contracted work commenced after the anticipated start date provided in the notices; meaning, the Carrier not
only gave a minimum 15-day advanced notice to the Organization, but more so, extended the 15- day advanced notice requirement.
By the Board’s standard in these Awards, it flagrantly oversteps its authority by declaring that the Carrier was in procedural violation of the dates of anticipated work by work commencing after the anticipated start date listed in the notice. Let this notion resonate with the reader; the Board has overstepped its bounds by interjecting and directly inferring that the Carrier has somehow violated the terms of the existing Agreement for commencing contracted work beyond the anticipated start dates, yet utterly fails to identify how the terms of Appendix 8 have been violated. Here, the Board has not only misinterpreted the plain text of the Agreement but has alarmingly attempted to solidify its ill-informed decision into arbitral precedent.
Furthermore, in these Awards, the Board cites that the Carrier has failed to comply with the December 11, 1981, National Letter of Agreement, also known as the “Berge-Hopkins Letter.” As stated, numerous times in the on-property handling stages of these claims, the “Berge-Hopkins Letter” does not apply.
The Berge-Hopkins letter established a process back in 1981 to address the Organization’s concern that scope-covered work was being contracted out unnecessarily. The first step was to establish a National Committee to address specific instances of contracting out as identified by the Organization. Interestingly, the Organization failed to provide any information to the National Committee, according to Charles Hopkins’ testimony before PEB 229. The next step was the Carriers’ commitment to “assert good-faith efforts to reduce the incidence of subcontracting and increase the use of their maintenance of way forces to the extent practicable…” This language did not serve to prohibit contracting out or restrict the Carriers’ right to contract out work. According to Mr. Hopkins, the author of the Berge-Hopkins letter, that letter was rendered obsolete by subsequent bargaining rounds, specifically 1984 and 1986, and most decidedly by Article XV of the 1996 National Agreement (PEB 229).
Article XV established a contracting ratio for each Carrier based upon the adjusted engineering department purchased services (as reduced by costs not related to contracting) and clearly states that “The amount of subcontracting on a carrier…will not be increased without employee protective consequences…” Article XV is clear that BNSF can contract out work, without penalty, so long as the amount of contracting does not exceed the established contracting ratio. (There are additional tests that must be met that are not relevant to this instant dispute.) In other words, Article XV continued a Carriers’ right to contract out work up to the same levels they had been contracting previously, without penalty. Clearly, there is no longer any requirement to reduce contracting because Article XV clearly states otherwise. Yet, despite this clear set of facts, the Board incorrectly cites this as being a mitigating factor as to why the claims at hand were sustained. On balance, while the Board needlessly cited the Berge-Hopkins letter in its Awards, it should be noted that the Berge-Hopkins letter makes no reference to contracting notice requirements for an “actual start date” as opposed to an anticipated start date.
Even more worrisome than the sustainment of these Awards is the fact that the Board has isolated itself, declaring its opinion supreme and superior to that of its predecessors, on the very topic of contracting out work on this property through the channels of Appendix 8.
The issue of contracting work through Appendix 8 in these Awards are, by no means, cases of first impression. There is a long, steeped arbitral precedent set demonstrating the simple terms of Appendix 8 and the Carrier’s right to contract out work.
By way of example, in Third Division Award 42518, Referee Wesman agreed with the Carrier’s interpretation. This case pertained to contracting work on this very property. Interestingly enough, in this case, the Organization contested contracted work to which the Carrier sent notice to the Organization with an anticipated start date of May 1, 2009, but work actually commenced on May 27, 2009. Referee Wesman ultimately denied the Organization’s claim in this award, stating, in pertinent part that:
To support this notion, the Carrier also urges the reader to turn to Third Division Award 44594 where Referee Darby held similar logic to Referee Wesman’s from Third Division Award 42518. In this instance, again, the Carrier provided the Organization notice on this very property with an anticipated start date of July 1, 2016, but work actually commenced on July 18, 2016. Referee Darby ultimately denied the Organization’s claim in this award, stating, in pertinent part that:
See also, Third Division Award 42517.
The Carrier urges the reader to recognize that neither of these preceding awards require a start date to be identical to the anticipated start date in the notice given to the Organization.
It is abundantly clear that in each of the Awards administered by this Board, it has failed to enforce the plain language given through Appendix 8 of the Agreement. This is alarming for a myriad of reasons. If the Carrier were bound to adhere to the rendered decisions given through this Board’s judgement, it would effectively cripple the Carrier’s ability to contract work in order to effectively, sufficiently, and succinctly operate its business in an expedient and efficient manner.
The Carrier’s business is a fast-paced, ever-fluctuating environment that requires real-time decisions to ensure the most proficient logistical operations are carried forward to nourish the national supply chain. The Board has been hoodwinked by the Organization into believing the notion that there are more compulsory stipulations mandated in Appendix 8 than there truly are.
By the Board’s own judgement, it attempts to effectively cripple the Carrier’s ability to do just that and eliminates any flexibility to commence contracted work after the anticipated start date given to the Organization in a written notice. In essence, this would eliminate the Carrier’s ability to provide the Organization with System Notices and would have to, at every turn, “reset the clock” on providing the Organization with a new notice if the anticipated start date of the contracted work were to change. There are numerous amounts of both valid scenarios and reasonings that contracted work could potentially alter from the anticipated start dates. The Board’s judgement effectively suffocates the Carrier’s right and ability to do so. The terms of Appendix 8 are quite simple and clear as seen from above. The Carrier is obligated to follow the parameters of the Agreement—no more, no less—which is what it has done in each of these cases.
Additionally, it should be noted that historically speaking, the Organization has largely left the terms of Appendix 8 unchallenged due to its clear language. Not until recent years with changes in Organizational leadership has the body and text of Appendix 8 been challenged. To the Organization’s dismay, its current and future leadership should take heed of its predecessors’ knowledge on the topic—meaning, it would behoove them to accept the fact that Appendix 8 is clear and unambiguous. The text is simple, precise, and what the framers negotiated upon its adoption.
Adding to the fact that the Organization has historically left the terms of Appendix 8 unchallenged, is the simple reality that Contracting Notices and System Notices have been disbursed on-property for decades. Carrier’s practice of distributing System Notices spans decades. System Notices are distributed to the Organization once a year and describe, in detail, various contracting work programs that will transpire across the Carrier’s system in the subsequent year. Notably, the System Notice includes locations of where work is expected to transpire, but also anticipated start dates, not exact, of when work is expected to commence.
A prime example, ipso facto, is that since 2008, a total of approximately 337 System Notices have been distributed to the Organization, yet the Organization had not challenged the validity of these System Notices under Appendix 8 until recent years.
Year | System Notices Issued |
2008 | 22 |
2009 | 22 |
2010 | 23 |
2011 | 19 |
2012 | 23 |
2013 | 21 |
2014 | 20 |
2015 | 20 |
2016 | 21 |
2017 | 20 |
2018 | 20 |
2019 | 22 |
2020 | 23 |
2021 | 20 |
2022 | 21 |
2023 | 20 |
Total | 337 |
Stated again, the current Organization’s predecessors, in early years, knew the limitations and simplicity defined in Appendix 8.
Furthermore, it is also supported and warned through arbitral precedent, that dangerous, ineffective, and incorrect arbitral precedent should not necessarily be followed. In Third Division Award 10063, Referee Daly stated, in part, that:
To rely on the Board’s faulty analysis in the Awards in these cases would most certainly be a dangerous precedent that would most certainly compound mistakes.
Through these Awards, the Carrier is quite concerned with what type of precedent and practice this would establish in the future. More troublesome is that through the Board’s faulty logic they have either decided to overstep its bounds by attempting to implement precedent that is not supported by any clear terms of the existing Agreement through its failure and ignorance of analysis or has decided to intervene and enact a level of judicial activism that is unprecedented, unwarranted, unsupported, and unwelcome through the existing terms of the Railway Labor Act.
May it be abundantly clear, that the Board’s Awards have the potential to enact spoken and unspoken, surreptitious, forceful, and rippling effects throughout not only the Carrier’s property, but other Industry Carriers. The rendered judgements in these Awards are isolated from any supported Agreement language, but also stray from past arbitral precedent set. In each of these cases, the Carrier followed the terms of the Agreement. These Awards should serve as caution and prime example of the dangers and Awesome authority the Board is bestowed with. Its judgement
must be precise and accurate, for the misuse or misinterpretation may have primordial, spiraling effects that may not be able to be rectified. In short, the Board must avoid the Siren call to dispense unsupported language and analysis that are not confined to the specific texts of Appendix 8. The Carrier will continue, as it has historically done, to follow the terms of the existing Agreement to pursue contracting work.
For the foregoing reasons, we vigorously dissent.
Joe R. Heenan James C. Rhodes
General Director Labor Relations Director Labor Relations
Carrier Member Carrier Member