PUBLIC LAW BOARD NO. 4402
PARTIES
) BROTHERHOOD
OF MAINTENANCE OF WAY EMPLOYES
TO )
DISPUTE ) BURLINGTON NORTHERN RAILROAD COMPANY
STATEMENT OF CLAIM
1. The Carrier violated the Agreement when it assigned outside forces
to perform track maintenance work, i.e., application of "in track" tie
preservative (ADZ-LIFE), at various locations within the Ottumwa
Division beginning on July 9, 1987 (System File # 3 Gr./GMWA
87-12-1 D).
2. The Carrier also violated the Note to Rule 55 when it failed to timely
schedule and hold a meeting to discuss its plans to assign said work
to outside forces as requested by the General Chairman in his letter
dated June 24, 1987.
3. As a consequence of the violations referred to in Parts (1) and/or (2)
above Foreman C. C. Burkhalter, Truck Driver L. R. Ament and
Sectionmen R. L. Littlejohn, P. D. Lord, K. P. Gosser, R. J. Paris,
F. N. Montgomery, R. D. Littlejohn, D. H. Jones, M. A. Bibby
and J. L. lllingsworth shall each be allowed eight (8) hours straight
time pay and two (2) hours' overtime pay, at their respective rates,
for each work day beginning July 9, 1987 and continuing.
OPINION OF BOARD
This dispute concerns the Carrier's contracting out "in-track" tie treatment. By
letter dated June 23, 1987 the Carrier's Chief Engineer J. A. Leeper notified the
Organization's General Chairman P. S. Swanson:
This letter is to inform you of the Carrier's intent to contract the
work of "In-track" tie treatment on this Region. We desire to initiate
this work on the Galesburg Division, First Subdivision, between
Galesburg and Creston, IA.
This work represents a new technology in crosstie preservation not
performed prior to 1986 on the BN or any other railroad. It is
similar to treatment developed by the Osmose Corp. that has been
applied to timber bridge piles and other wooden structural members.
The purpose of this treatment is to inhibit decay through the injection
of toxic preservatives. Such treatment on bridges has historically
been done by contractor.
PLB 4402, Award 28
Contracting of Tie Preservative Work
Page 2
The purpose as it related to "in track" treatment of crossties is still
being refined, and rights to the material and equipment used in this
application are proprietary. Despite our efforts to procure the
equipment to perform this work, such equipment is unavailable for
sale or lease, and is still in the prototype stages.
This preservative, known under the trademark "Adz-Life", is a
patented substance and carries an Environmental Protection Agency
classification as a hazardous material. As such, any person
responsible for its application must be licensed according to
applicable federal, state, and local regulations.
Ties treated in this manner will be warranted against additional decay
for five years from the date of treatment.
Since Carrier employees are neither licensed, experienced, nor
qualified in this process: and equipment required is unavailable to
the Carrier, it will be necessary to handle by contractor, as has been
done in the past.'
By letter dated June 24, 1987 the Organization stated that it did not concur with the
Carrier's proposed actions and, without specifying a date :or a meeting, requested "a
conference to discuss this matter in accordance with the Note to Rule 55." On July 9, 1987
the Carrier entered into a contract with Osmose Wood Preserving, Inc. for the performance
of the work and the work commenced on that date. The Carrier and the Organization met
on July 13, 1987 to discuss the Carrier's notice of its intent to contract out the work, but no
agreements were reached. This claim followed on August 29, 1987.
The rules set forth in this Board's previous awards on the issue of contracting out
work govern the analysis in this case. See PLB 4402, Awards 20 and 21.
Under the Note to Rule 55 and Appendix Y, we find that the record sufficiently
demonstrates that the general work at issue (i.e., the application of wood and tie
preservatives) falls "within the scope of this Agreement".
See
e.g., Roster 3 where
employees operate equipment such as Adzing Machines and Creosote Sprayers. Moreover,
t This notification was not the first attempt by the Carrier to contract out "in-track" tie treatment
work. For example, it is undisputed that by letter dated December 16, 1986 the Carrier gave similar
notification to the Organization concerning proposed contracting of that work on the Carrier's
hac itic
Division.
PL13 4402, Award 28
Contracting of Tie Preservative Work
Page 3
the work involved clearly falls within sectionmen's duties of "... repairing and maintaining
... track ...: ' as set forth in Rule 55Q. There is no real dispute that the employees have
performed related general tie maintenance in the past.2 We therefore conclude that the
Organization has sufficiently demonstrated that the employees have "customarily
performed" the general work at issue within the meaning of the Note to Rule 55 and hence,
the Carrier was obligated to give notice of its intent to contract out the work at issue 3
Further, we find that the Carrier met its obligations under the Note to Rule 55 to
give notification to the Organization of its intent to contract out the work. The Note to Rule
55 (and the duty which is reiterated in Appendix Y) obligates the Carrier to give the
Organization such written notice "not less than fifteen (15) days" ... "in advance of the date
of the contracting transaction". Here, the Carrier gave such notice on June 23, 1987 which
the Organization asserts it received on June 24, 1987. The "contracting transaction" was
not entered into and the work did not commence until July 9, 1987 - 15 days after the
notification. Therefore, under the Note to rule 55, the Carrier met its obligations.
Contrary to the Organization's argument, the fact that the parties did not meet until
after the work commenced does not, by itself, require a sustaining of the claim in this case
on the basis that the Carrier failed to act in good faith. The Note to Rule 55 obligates the
Carrier to meet "promptly" with the Organization after notification is given and upon the
Organization's request. There is nothing in this record to demonstrate that the Carrier
purposely postponed meeting with the Organization in order to delay or to make its actions
a
fait
accompli. Indeed, the correspondence discloses that the Organization did not specify
a date for a desired meeting but just requested the Carrier to contact the Assistant General
Chairman "for setting a time and place for said conference". We must conclude that
See the Carrier's January 28, 1988 letter concerning the fact that "Maintenance of Way employes
in the past have made topical application of preservatives to the exposed surfaces of ties by spraying."
For reasons set forth in Awards 20 and 21 of this Board, we reject the Carrier's assertion that the
Organization was obligated to demonstrate that the employees performed the work on an exclusive basis.
The requirement in the Note to Rule 55 is that the work be "customarily performed", not "exclusively"
performed.
PLB 4402, Award 28
Contracting of Tie Preservative Work
Page 4
without more, under the facts of this case, we cannot find that the Carrier failed to act in
good faith as required by the Note to Rule 55 or Appendix Y. Here, our inquiry
is
limited
to whether or not the Carrier met "promptly" as required by the Note to Rule 55. We find
that it did .4
The inquiry then turns to whether the Carrier's contracting of this work to Osmose
fell within the specified exceptions in the Note to Rule 55:
... [S]uch work may only be contracted provided that special skills
not possessed by the Company's employes, special equipment not
owned by the Company, or special material available only when
applied or installed through supplier, are required: or when work is
such that the Company is not adequately equipped to handle the
work, or when emergency time requirements exist which present
undertakings not contemplated by the Agreement and beyond the
capacity of the Company's forces.
We find that the Carrier has demonstrated that "in-track" tie treatment falls within
the above exceptions. First, although we have found that the type of work involved in this
dispute (the application of wood and tie preservatives) is work that has been customarily
performed by the covered employees, we find the specific method utilized by the contractor
4 Obviously, it makes good sense to hear the Organization out prior
to
taking action so that the
Organization's point of view could be considered. Such input may provide alternatives to the Carrier not
previously considered; present opportunities to resolve other related matters in dispute; or simply avoid the
filing of claims. However, notwithstanding those practical considerations, in this case the clear language in
the Note to Rule 55 does not require the preconditions argued appropriate by the Organization.
Third Division Award 20071 cited by the Organization is distinguishable. There, the question was
whether or not the carrier met in a "prompt" fashion as required by the Note to Rule 55 after it gave notice
of intent to subcontract on February 1, 1971; agreed to a meeting on February 18, 1971; delayed the
meeting until at least March 10, 1971 and, during the interim, on February 18, 1971 contracted with the
outside forces. No such delaying devices have been demonstrated by the Organization in this case. In that
case the delay was 37 days with a postponement. Here, the Carrier met with the Organization on July 13,
1987 - 20 days after notification with no postponement. Again, we cannot say that the Carrier was not
"prompt" in this instance. Similarly, Third Division Award 26770 is not on point. The determinative
factor in that dispute was the fact that the carrier utilized a contractor because of the need to use specialized
equipment and the contractor was observed performing work without the use of that equipment. Such is not
the case herein.
We also find Third Division Award 28486 inapplicable. There, no notification of contracting out
was given by the carrier. Such is not tile case herein. Finally, Third Division Award 28590 is not
persuasive. That case involved the unloading of crossties by outside forces. That case turned on the ability
of the carrier to use alternate equipment to perform the work. The Board found that work could have been
accomplished in alternative fashions and none of the relevant exceptions applied In light of the uniqueness
of the injection process and its results and the inability of the Carriet'to obtain the necessary equipment and
use of the process from the contractor, we cannot say the same in this case.
PLB 4402, Award 28
Contracting of Tie Preservative Work
Page 5
as unique with different procedures and results from those' performed and obtained by the
prior work performed by the covered employees. Specifically, according to the record, the
employees applied preservative in a more topical application to the exposed surfaces of ties
by spraying. Here, the ties are treated while in place by injecting the preservative mixture
under the tie plate in a fashion with a degree of success that has not been accomplished
before. The results of the injection process differ from topical application because the
injection process allows the preservative to permeate from the tie's center to its surface.
The end result is that the preservative mixture and the process utilized by the subcontractor
extends the life of the ties more than accomplished before.
Second, the record demonstrates that at the time the dispute arose, the preservative,
"Adz-Life", was -a patented substance carrying an Environmental Protection Agency
classification as a hazardous material and those responsible for its application were required
to be licensed according to applicable federal, state and local regulations. While the
preservative may have been commercially available as the Organization argues, the ability to
acquire the substance is not the issue. The relevant issue concerns the Carrier's ability to
apply the substance. Because of its hazardous classification and the licensing
requirements, the lack of employees with such credentials and the fact that such licenses
were possessed by the Osmose employees weighs in favor of the Carriers
Third, with respect to the process of application of Adz-Life, although at the time
this dispute arose there was no patent on that process, there was a patent application
pending as of March 30, 1987 which application was ultimately granted by the U. S. Patent
Office on April 19, 1988. While we recognize that at the time this dispute arose, the patent
application was only pending which did not completely preclude the Carrier from taking
steps to apply the substance through its own resources, the fact that the application was
While the Organization asserts that obtaining such a license is not a major accomplishment and, in
fact, subsequent to this dispute one of the Claimants
(R.
L. Littlejohn) obtained such a license, the relevant
inquiry concerns the possession of that license at the time the dispute arose. The record clearly
demonstrates that at the time the dispute arose, no Carrier employees had such a license.
PLB 4402, Award 28
Contracting of Tie Preservative Work
Page 6
subsequently granted lends immense weight to the Carrier's assertions that the process was
unique in terms of the exceptions in the Note to Rule 55.
Fourth, prior to this particular dispute, the Carrier made specific efforts to obtain
the equipment and to have Osmose use the Carrier's employees, which efforts were
rejected. The record discloses two letters from Osmose dated September 23 and 29, 1986
to the Carrier rejecting such requests:
The specialized equipment and tools we are using have been built by
us, since what was needed was not commercially available. We are
not at all interested in selling this specialized equipment so that
others can accomplish the same work.
Neither are we interested in providing supervisory staff so that the
work can be accomplished by your own forces. Currently, we are
charging on the basis of unit prices. It is imperative that we have
total control over the forces accomplishing this work so that we
retain control of production. If we were not in full control of
production, it would be necessary for us to charge a per tie cost that
would not be economical. The program would therefore lose all of
its benefit.
We are not interested in providing supervisory staff so that the work
can be accomplished by your own forces, nor are we interested in
operating a work force of combined personnel (BN and Osmose)
Therefore, aside from demonstrating the need for special skills and equipment not
owned by the Carrier and that only the supplier could be used for this process under the
exceptions specified in the Note to Rule 55, these efforts by the Carrier further demonstrate
its compliance with the requirements in Appendix Y to "reduce the incidence of
subcontracting and increase the use of their maintenance of way forces .. including the
PLB 4-t02, Award 28
Contracting of Tie Preservative Work
Page 7
procurement of rental equipment and operation thereof by carrier employees,"6
In stun based upon the record before us, we find that under the Note to Rule 55 and
Appendix Y, the Carrier was obligated to give notice to the Organization of its intent to
subcontract the disputed work; the Carrier complied with the notification requirements; the
Organization has not otherwise demonstrated that the Carrier operated in less than good
faith; and the contracting out of this work was in accord with the exceptions specified in the
Note to Rule 55. As such the claim shall be denied.
AWARD
Claim denied.
Edwin H. Benn
Neutral Memberon
E. . Kallinen P. S. SwansCarrier Member Organization Member
-s~ei^
Denver, Colorado
April 26, 1991
On the property, the Organization contended that another company (Herzog) "is doing this work in
the western part
of
Iowa and eastern part
of
Nebraska ... [and t1here is another company in Washington
doing this work also ...." Given the lack
of
specifics concerning the actions of these two companies and
further given the clear and unmistakable position set forth by Osmose that its process was unique and only
it and its employees would perform that work, we find the assertion made by the Organization insufficient
to change the result. The same reasoning holds for the Organization's arguments that the Carrier could have
fabricated equipment to inject Adz-Life.