Did the Carrier improperly pay D. Coronado (Claimant) compensation benefits under the Agreement dated February 7, 1965, as amended September 26, 1996 (Feb 7t' Agreement) for the period in December 2000 that it did not retain him in service?
If the answer to 1 above is YES", shall the Carrier be required to issue Claimant Feb 7'i' Agreement compensation benefits equal to his normal protected rate of compensation for the time the Carrier did not retain him in service in December 2000, i.e., pay him his $15.95 per hour protected rate for each hour it did not retain him in service?
Did the Carrier improperly pay Claimant compensation benefits under the Agreement dated February 7, 1965 as amended September 26, 1996 (Feb 7`h Agreement) or he period in January 2001 that it did not retain him in service?
If the answer to 3 above is "YES", shall the Carrier be required to issue Claimant Feb 7`h . Agreement compensation benefits equal to his normal protected rate of compensation for the time the Carrier did not retain him in service in January 2001, i.e., pay him his $16.07 per hour protected rate for each hour it did not retain him in service?
This Board, after hearing upon the whole record and all evidence, finds that the parties herein are Carrier and Employe within the meaning of the Railway Labor Act as amended; that this Board has jurisdiction over the parties and the subject matter of the dispute herein; that this Board is duly constituted according to the 1996 Mediation (National) Agreement and as specified in the National Mediation Board appointment letter dated August 18, 2004; and that all parties were given due notice of the hearing held on this matter.
Claimant is a protected employee pursuant to the February 7, 1965 Job Stabilization Agreement, as amended and updated by the September 26, 1996 National Mediation Agreement. Claimant initiated claims charging that the Carrier did not pay him the proper amount of protective pay for December 2000 and January 2001.
The Organization and the Carrier concur that Claimant's hourly protected rates were $15.95 for December 2000 and $16.07 for January 2001. The parties also concur that Claimant received compensation for performing active service and/or vacation benefits during these two months. More specifically, Claimant received eight hours of pay for time worked as well as forty hours of vacation pay during December 2000. During January 2001, the Carrier paid Claimant straight time wages for sixty-four hours of service. For the remainder of both months, Claimant was relegated to furloughed status.
The compensation which Claimant received for performing active service or vacation time was at hourly pay rates higher than his hourly protective pay rates. This dispute centers on how Claimant should be compensated under the February 7, 1965 Job Stabilization Agreement, as amended, for the time during December 2000 and January 2001 that he was not retained in service.
SBA No. 1087: Award No. 30 Page 2The issue is illustrated by examining Claimant's status and pay during December 2000. December contained twenty-three work days. If the Carrier had retained Claimant in service he would have received straight time pay (and/or vacation pay) for one hundred eighty-four hours. For the eight hours that Claimant actually worked, his straight time hourly pay was approximately two dollars greater than his protected rate of pay. Similarly, for the forty hours that Claimant received vacation pay, the amount of the vacation pay, on a per hour basis, was approximately two dollars above his protected pay rate.
The Carrier determined the amount of protective benefits that it paid Claimant by first multiplying the number of available hours (one hundred eighty-four) by Claimant's hourly protected rate ($15.95). The Carrier then deducted the eight hours of straight time pay for time worked and the forty hours of vacation pay. The Organization contends that the proper calculation is to first subtract the number of hours Claimant worked or for which he received vacation pay from the number of available hours in the month and then multiply the remaining hours (one hundred thirty six) by Claimant's protected rate.
Both parties submit that Article IV, Section 1 of the February 7, 1965 Job Stabilization Agreement, as amended by the 1996 National Mediation Agreement, supports its formula for calculating Claimant's protective pay. Article IV, Section 1 provides:
The Carrier submitted documentation demonstrating that, during the past twenty years, its computer programs calculated protective pay for protected employees of several crafts (including Maintenance of Way Employees) according to the monthly formula that it applied to Claimant herein. The Carrier specified that when protected employees are loaded into the program, protective benefits were routinely computed just as the Carrier calculated Claimant's protective payments. The Carrier also asserted that one of its predecessor railroads, the Missouri Pacific Railroad, had an automated program which used the same formula to calculate February 7, 1965 Job Stabilization Agreement protective allowances. The Carrier submitted a report from April, 1985 showing a protected employee who worked on jobs paying the employee at rates both higher and lower than his protective pay. This employee received a protective allowance according to the same calculation that the Carrier used to determine Claimant's protective payments for December 2000 and January 2001. Finally, the Carrier declared that prior to this dispute, the Organization never filed a claim challenging the Carrier's methodology of computing protective allowances. II. THE POSITIONS OF THE PARTIES
Claimant was protected with an hourly rate of pay. This hourly protected rate was Claimant's "normal rate of compensation" as specified in Article IV, Section 1 of the February 7, 1965 Job Stabilization Agreement, as amended. Therefore, Claimant was entitled to receive his rate of protection for each available work hour that the Carrier did not retain Claimant in service. The Carrier unilaterally and improperly transformed Claimant from an hourly rate protected employee into a monthly rate protected employee. SBA No. 1087: Award No. 30 Page 4
Article IV, Section 1 refers to the "normal rate of compensation" on a "regularly assigned" position which clearly connotes an hourly calculation. Article IV, Section 1 does not refer to or mention any monthly guarantee.
Under the Carrier's formula, Claimant incurs a loss as opposed to winning a windfall. If, during December 2000, Claimant had continued to work at a job rated exactly the same as his protected rate of pay for the remaining one hundred thirty-six hours, he would have earned aggregate compensation for the month greater than his actual earnings plus the amount that the Carrier ultimately paid him. Thus, he suffered a loss of pay because he did not receive his "normal rate of compensation".
When Claimant held a position having a higher rate of pay than his protected rate of pay, he earned compensation set by the applicable schedule agreement. Nothing in the February 7, 1965 Job Stabilization Agreement permits the Carrier to offset the amount that Claimant earned for service performed (or for vacation pay) from his protective guarantee. Special Board of Adjustment No. 6105, Award No. 234 (Friedman).
Finally, the Carrier's position herein is inconsistent with the position which the Carrier took any other cases where it contended that the Job Stabilization Agreement does not allow an upward adjustment in protected rates aside from subsequent general wages increases. The Carrier cannot have it both ways. If the protected rate is not adjusted upward, then the Carrier cannot utilize the greater amount of earnings accruing to Claimant as an offset against his protected rate which is equivalent to a downward adjustment.
Article IV, Section 1 clearly and unambiguously provides that Claimant is entitled to his normal rate of compensation which is his hourly protected rate for each hour that
SBA No. 1087: Award No. 30 Page 5he is not retained in service. Any past practice cannot vary or alter the clear language in Article IV, Section 1, of the February 7, 1965 Job Stabilization Agreement, as amended.
Article IV, Section 1 of the February 7, 1965 Job Stabilization Agreement, as amended, clearly defines protective benefits in terms of compensation rather than a rate of pay. For the month of December 2000, Claimant's normal rate of compensation was his protected rate multiplied by the number of available work hours. The product of that equation is the protective guarantee he would have received if he did not work (or receive vacation pay) for any hours during December 2000. The Carrier properly deducted the compensation he received for vacation and performing service from his normal rate of compensation to determine the net amount of protective pay due to Claimant.
Under the Organization's formula, Claimant would receive a windfall. The Organization improvidently seeks a calculation on an hourly basis so that for each hour that Claimant received no pay or a pay rate lower than his protected rate, Claimant would be allowed the difference in pay for each hour. There is not any language in Article IV, Section 1 suggesting that protective pay must be calculated on an hour by hour basis or even on a day by day basis. In essence, the Organization's position would increase the level of compensation for Claimant in excess of his protected rate as opposed to insulating him from a lack of (or a decrease in) earnings which is the objective of the Job Stabilization Agreement.
If the language in Article IV, Section 1 is unclear, the past practice on this property supports the application of the Carrier's formula. Without any challenge from the Organization, the Carrier has used the same computer program for twenty years to
SBA No. 1087: Award No. 30 Page 6determine the protective pay due to protected employees in several crafts. More particularly, the Carrier has consistently applied the monthly formula to Maintenance of Way employees. Since the February 7, 1965 Job Stabilization Agreement has been in effect for more than forty years, i't is inconceivable that this Organization never brought a claim if the Carrier's application violated the Job Stabilization Agreement. The absence of claims conclusively demonstrates that the Carrier's formula is the proper interpretation of the "normal rate of compensation" phrase set forth in Article IV, Section 1.
If Claimant had not performed any active service and had not received vacation pay during December 2000, the parties agree that Claimant would have been entitled to receive a protective payment calculated by multiplying one hundred eighty-four (available work hours) by his protected rate of pay ($15.95 per hour). The disagreement arises because Claimant earned wages and received vacation pay at hourly rates greater than his protected pay rate covering forty-eight hours dunng December 2000. The Organization submits that those earnings must be disre4 arded so that Claimant's protective pay is predicated solely on the number of remaining available work hours. Contrarily, the Carrier submits that Claimant's protective guarantee must be calculated on a monthly basis by deducting the earnings he received from the aggregate protective pay he would have received if he had neither worked nor received vacation pay during December 2000.
Article IV, Section 1 provides that Claimant "... shall not be placed in a worse position with respect to compensation than the nonnal rate of compensation for said regularly assigned position ..." based on the position that Claimant held when he became
SBA No. 1087: Award No. 30 Page 7a protected employee. The adjective "normal" before the noun "rate" refers to the pay rate attached to the position which, in this case, is an hourly rate of $15.95. This placement of words might imply that the protective pay calculation is predicated on an hourly basis.' However, Article IV, Section 1 is vague because it also provides that the employee shall not be placed in a worse position with respect to the normal rate of compensation which implies that the protected employee should not be placed in a better or more lucrative position than the employee's normal rate of pay. Applying the formula advanced by the Organization could result in Claimant receiving far greater compensation than he would receive if he had been furloughed the entire month of December.
Prior awards interpreting the February 7, 1965 Job Stabilization Agreement are not helpful in reconciling the contradiction between not placing Claimant in a worse position vis-a-vis protecting him at the normal rate. In Special Board of Adjustment 605, Award No. 397 (Rohman), the Board ruled that the Carrier may compute protective guarantees on a monthly basis but the decision addressed a daily rated position and focused on daily overtime pay as opposed to straight time pay. In Special Board of Adjustment No. 605, Award 450 (LaRocco), the Board addressed an unusual situation where language that was changed for the sole purpose of conforming to the Railroad Unemployment Act could be misconstrued resulting in an unintended windfall for protected employees. Award No. 450 did not definitively define "normal rate of compensation" within the context of the facts presented in this case. Similarly, in Special Board of Adjustment No. 605, Award No. 234 (Friedman), the Board held that the Carrier
' This implication would be problematic if the rate attached to the position on the day the employee becomes protected is a rate other than an hourly rate. SBA No. 1087: Award No. 30 Page 8
could not offset regular earnings from protective pay but the earnings in question were from sources distinct from the usual hourly wages for performing straight time service. In sum, these decisions do not provide any guidance for resolving this dispute.
Since the language in Article IV, Section 1 is vague and susceptible to more than one reasonable interpretation, this Board may properly resort to extrinsic evidence, including evidence of a past practice, to construe the vague provision. The record contains substantial evidence of an open, notorious, continuous, and uninterrupted past course of applying Article IV, Section 1 to protected employees. For the last twenty years (or longer), the Carrier, and at least one of its processor railroads, has utilized a computer program that calculated protective pay according to the formula that the Carrier applied to Claimant herein. During these twenty years, the Organization did not grieve the Carrier's application. In addition, the Organization did not present any evidence either refuting the past practice or demonstrating that the Organization lacked actual or constructive knowledge about how the Carrier routinely applied Article IV, Section 1 to protected employees. Therefore, the past practice is controlling.
In summary, the Carrier properly paid Claimant's protective guarantee under the February 7, 1965 Job Stabilization Agreement, as amended, for both December 2000 and January 2001.
From the very beginning, the Employe Members warned this Board to not confuse the payment schedule with the "normal rate of compensation." Yet, it is apparent that is exactly what has happened.
Immediately this Board should have recognized that the Carrier's calculation process creates at least four (4) different "normal rates of compensation" in a calendar year, when the Feb 7t" Agreement provides for only one "normal rate of compensation. Please see the following which illustrates this point.
Simply stated, the Carrier's calculation process which, in reality, is based on a payment schedule, can not be correct because it provides four (4) different normal rates of compensation when the Feb 7m Agreement clearly provides for only one "normal rate of compensation." Stated differently, how could there be four (4) different "figures" representing one "normal rate of compensation?"
Contrary to what the award says, the language does not "imply that the protective pay is predicated on an hourly basis." In this case, it declares it conclusively. Stated differently, how could anyone conclude in this case that this language implies that the protective pay calculation is predicated on a monthly basis? Further, it is not problematic if the rate attached to the position was not hourly, i.e., it was daily, weekly or monthly. For example, if the employee was filling a position that had a normal rate of compensation that was a daily rate, the determination of benefit entitlements would simply be a comparison between the daily rate of compensation he receives (or not) each available day of earning opportunity and the daily protected rate he is guaranteed to receive each day. Contrary to the award's implication otherwise, correctly categorizing the Claimant as an "hourly protected employee" and computing his benefit entitlement on that basis as the Organization asserts, does not, in anyway, cause a problem in connection with computing benefit entitlements for a protected employee whose normal rate of compensation is a daily, weekly or monthly rate.
As indicated on page 9 of BMWED's submission, the Carrier was not obligated to make payment of protective benefits in line with any specified schedule. In choosing a payment schedule, all the Carrier was required to do was "...keep reasonably current in maintaining the protected rate of compensation of a protected employee," as determined by SBA 605 Awards 268 and 269. The Carrier apparently chose, and the Organization accepted without protest, a monthly schedule for making payments to entitled Article I, Section 1 protected employees, which was in line with those awards.
As previously indicated, choosing and implementing one payment schedule over another does not allow the Carrier to treat the Claimant as if he was a monthly rated employee or unilaterally change his hourly protected rate of compensation to a monthly protected rate of compensation.
Further, choosing one payment schedule over another should not change the amount of his benefit entitlement. However, this is exactly what occurs with the Carrier's calculation process of deducting the earnings he received from the aggregate protective pay he would have received during a particular period had he been furloughed the entire time. In fact, the Employes provided clear and undeniable evidence how the Carrier's calculation process produced a different benefit payment for the Claimant's same 136 hours of furlough when a monthly, bi-monthly or quarterly payment schedule was used.
The question is, if the Claimant is to "...not be placed in a worse position with respect to compensation than the normal rate of compensation for said regularly assigned position..."and there can be only one "normal rate of compensation," how could there be three (3) different payments for the same 136 hours Claimant was furloughed? Surely, the writers of the Feb 7' agreement did not contemplate there would be different payments for the same time of furlough simply because the Carrier chose one payment schedule over
another. Instead, the writers of the Feb 7t" Agreement obviously contemplated payments to be uniform for the periods of furlough regardless of the payment schedule the Carrier employed and the universal language they created in Article IV, Section 1 appropriately captures that which they contemplated. Obviously, the Carrier's payment methodology, which provides a host of different payments for the same period of furlough, makes no sense whatsoever and is in direvt conflict with the intended payment concepts contemplated by the writers of the Feb 7' Agreement.
On the other hand, the Employes clearly demonstrated and provided mathematical evidence verifying that in the application of the Article IV, Section 1 language in line with the obvious intent thereof and as contended to be correct by the Employes, the amount of payment for the same period of furlough did not change in any way regardless of the payment schedule utilized, i.e., the outcome is consistent and/or the same.
The Employe Members claimed that the Carrier's calculation methodology differs dramatically from the industry-wide practice. Specifically, the Employes contended that the process used by the BNSF, CSYY, NS and the CN coincides with the process that the Organization has argued to be correct in this case. The Board concluded that since the Employes did not raise such an issue on the property, the Board would not consider it in this case. It is felt this Board could have, and should have considered this information even though it was not part of the handling of the dispute on the property. Such handling would be in line with the agreed-to-procedures of October 25, 1996, specifically, Article III, paragraph B, which states:
Nonetheless, the inescapable conclusion is that the Carrier's calculation process cannot be correct since there is no basis for having four (4) different figures in a year representing the Claimant's "normal rate of compensation," and there is no basis for having different benefit amounts for the same period of furlough when using different payment schedules.
This Award indicates that since the language in Article IV, Section 1 is vague and susceptible to more than one reasonable interpretation, this Board may properly resort to extrinsic evidence, including evidence of a past practice, to construe the vague provision. First, BMWED does not agree that the language in Article IV, Section 1 is vague and susceptible to more than one reasonable interpretation. We have explained why the Carrier's interpretation is anything but reasonable by pointing out there is no basis for having four (4) different figures in a year representing the Claimant's "normal rate of compensation," and there is no basis for having different benefit amounts for the same period of furlough when using different payment schedules.
Secondly, the Employes provided awards of SBA 605, which ordered benefit payments to be made as the Organization argues is correct in this case. If there truly was a lack of clarity in the Article IV, Section 1 language as this award indicates, the awards cited by the Employes gave this Board guidance on how to interpret the language. There is no basis for this Board to ignore these past decisions and, then, say since the language is vague and there are no awards to give us guidance, we must rely on past practice.
Thirdly, and again, the prevailing practice among all the railroads other than UP is to calculate hourly rated employees' benefit payments on an hourly basis as the Organization has argued to be correct in this case.
Hence, there is no basis for this Board to rely on past practice. There were many who thought for many, many years that the world was flat. This Board suggests that because UPRR thought it was flat for many, many years, and conducted its business based on that premise, it should be allowed to continue to think of the world as flat and conduct its business based on that premise even though all others recognize the unmistakable evidence that the world is not flat. This makes absolutely no sense.
CARRIER MEMBERS' CONCURRING OPINION AND
ANSWER TO THE EMPLOYEE MEMBERS' DISSENTING OPINION
TO AWARD NO. 30 OF SPECIAL BOARD OF ADJUSTMENT NO. 1087
At the outset, the Carrier Members express their concurrence with the findings set forth in Award No. 30 of Special Board of Adjustment No. 1087.
The Employee Members' Dissent to that Award, dated May 3, 2007, merely recycles arguments that were repeatedly rejected by the Board and are no more convincing now. The arguments presented in the dissent regarding the method in which the Union Pacific Railroad Company has calculated and paid protective benefits, without objection from the employees or the organization for a period of over 20 years, were presented to SBA 1087 and were rejected by the majority because they are neither convincing nor rational.
That said, the Carrier Members are more deeply troubled by the lack of candor in the assertions made at page 4 of the Employee Members' Dissent, particularly that portion which states:
What the Employee Members did not disclose in their dissent was the fact that, in addition to their admission that this issue was not properly or timely raised by the employees during the handling of this dispute on the property, this issue was not raised in the Employees' Submission to SBA 1087 in Case No. 30, nor was this issue raised duriny, the oral argument of Case 30 before SBA 1087 on September 8, 2006. This issue had not been raised by the time a draft award was prepared and presented to the Employee and Carrier Members of SBA 1087. This issue was raised for the very first time by the Employee Members in an e-mail sent on March 8, 2007, in advance of an executive session scheduled for March 12, 2007. Moreover, when the issue was introduced by the Employee Members, it was raised as an assertion, without any evidence presented to support such assertion. To suggest that the Chairman or the Carrier Members in any way erred in refusing to consider the Employee's untimely and unsupported introduction of a new issue months after the case had been argued before SBA 1087 is ludicrous. For the Errployee Members to sugge~ < :hat they have the right to raise new issues for the first time after seeing a draft aw=ard that they do not find favorable is beyond comprehension.
The decision in Award No. 30 is correct; it is supported by the record in this dispute and its conclusions are based upon a reasoned interpretation of the language of the February 7, 1965 Agreement and a sound application of the principles of arbitration and the procedures agreed upon by the parties when they established Special Board of Adjustment No. 1087.