Effective July 1, 2016, rail employees covered under The NRC/UTU Health and Welfare Plan and The Railroad Employees National Health and Welfare Plan will see their monthly Health and Welfare contribution increased from the current $198.00 per month, to $228.89 per month.
Why the increase?
Since July 1, 2012 and pursuant to provisions of the September 16, 2011 National Rail Agreement, the health and welfare contribution was frozen at $198.00 per month. That agreement also contained provisions to increase the contribution amount to a maximum of $230.00 per month, effective July 1, 2016.
A national rail agreement is currently being negotiated and the new monthly contribution amount will remain in effect until modified.
How is the increase determined?
The formula used in determining the monthly employee contribution takes into account the Carriers Monthly Payment Rate for everything other than on-duty injury health care benefits, and the payment rates for benefits under The Railroad Employees National Dental Plan and The Railroad Employees National Vision Plan. The employee contribution is 15 percent of such monthly payment rates.
Former International President Tom DuBose (1991-1995)
Having served as a member and as chairperson of UTU national negotiating committees, and as a UTU International officer for 28 years, I found that the failure to reach an agreement on the national level carries the risk of having third party recommendations placed in effect by Congress.
In my 36 years of service, those decisions by Congress never were in favor of the worker – even when Democrats controlled both the House and Senate.
In today’s increasingly conservative and anti-labor political climate, allowing a presidential emergency board and Congress to determine our contract terms would be the same as our adopting the Section 6 notices of the carriers.
No national agreement has ever been perfect. This agreement is extraordinary in terms of what other labor unions have been able to achieve. A failure to ratify this agreement could be devastating to our membership.
Assistant President Arty Martin
Without the negotiated $200 monthly cap on employee health care contributions, they could rise to $355 monthly by 2015 under the formula in the existing contract.
That cap alone is worth more than $5,000 over the life of this agreement. In fact, not a penny of the wage increases negotiated is to be offset through higher health care insurance contributions for 6½ years, which is 1½ years beyond the term of this agreement. For many members, there could be a reduction in out-of-pocket costs for doctor visits and prescription drugs.
In addition to the 17-percent wage increase, which is actually 18.24 percent when compounded, we have negotiated additional pay for every FRA-certified job, a faster process for new hires to reach full pay, cash payments to those still under the five-year service scale, no work rules concessions and a process for local negotiations on alternative compensation, compensation enhancement and electronic bidding and bumping.
General Chairperson (NS GO 680) Pate King
I’m still feeling the devastating effects of PEB 219 in 1991, which were imposed by a Congress where Sen. Ted Kennedy (D-Mass.) and Rep. John Dingell (D-Mich.), both longtime friends of labor, chaired the key Senate and House transportation committees.
I shudder to imagine what the current anti-labor chairman of the House Transportation & Infrastructure Committee, John Mica (R-Fla.), might have in store for us if we vote down this agreement and turn our fates over to third parties.
This agreement deserves to be ratified on its merits. It is the very best agreement we could gain in this difficult economic and political environment.
International Vice President Delbert Strunk
This is the best deal out there by far: The wage increases, the cap on monthly employee health care contributions, significant savings that can be realized with decreases in generic drug co-pays and added coverage such as personalized medicine, improved entry rates for new hires, certification pay, and no work-rules concessions.
Additionally, general chairpersons have the opportunity to negotiate issues on the property relative to electronic bidding and bumping, as well as enhanced benefits. This is especially important for NS and CSX committees.
Every cent that could be gained at the negotiating table was squeezed from the carriers. No other organization has done better, period! This agreement should be ratified by our members.
International Vice President Robert Kerley
In a time of unprecedented global economic uncertainty, high unemployment rates and stagnating or retreating wages for most working Americans, this agreement provides for wage increases that far exceed anticipated increases in the Consumer Price Index, plus affordable and superior health care benefits that include the addition of state-of-the-art services and enhancements never before available to UTU members.
All this is without any work rule concessions that have historically accompanied such gains. I wholeheartedly endorse this proposal for ratification.
General Chairperson (CSX GO 049) John Lesniewski
It would be irrational for our UTU membership to forsake a 17 percent general wage increase (18.24 percent when compounded), certification pay and a condensed new-hire service scale for the alternative of an imposed settlement decided by a third party. Historically, having a third party-imposed settlement has fared poorly for labor.
Entering these negotiations, I didn’t anticipate we could roll back our members’ health care contributions to $200 monthly and freeze them for 6½ years. The health care cost issue isn’t going away, and we met it head on, minimizing the impact on UTU members in a responsible way.
We cannot simply bury our heads in the sand and ignore the current state of the economy, escalating health care costs, the high unemployment rate, and recent wage and health care settlements made by other organizations that are well below what we have negotiated.
Alternate International Vice President Doyle Turner
Our members need to consider today’s double digit increases in health care costs.
The proposed UTU national rail contract maintains your health care insurance contribution at $200 while improving coverage.
The agreement also provides a 17-percent increase in wages (which is more than 10 percent in excess of projected inflation over the life of the agreement), plus service-scale enhancements, FRA certification pay, a special wage adjustment for yardmasters of 12.5 cents per hour, and a supplemental sickness benefit increased to $3,333 per month.
I fully support this proposed agreement and urge a “yes” vote.
National Legislative Director James Stem
This is a very good agreement, regardless of economic conditions; but it is especially good given its increase over price inflation. No previous agreement provided wage increases so far above the Consumer Price Index without significant rules changes, as does this agreement.
Also to be considered is how the U.S. House of Representatives, controlled by political extremists, is attempting to reduce Railroad Retirement, Social Security and Medicare benefits, eliminate Amtrak and slash transit subsidies.
It would not be wise for us to ask Congress, already in gridlock over economic issues, to legislate an agreement based on recommendations of a presidential emergency board.
Workers are under sustained attack. This agreement provides significant financial improvement and economic stability for our families. Any other option would be a big gamble we cannot afford to take.
AFL founder Samuel Gompers said the objective of labor is, “more, now.”
Our national rail agreement fulfills that objective.
In an economic environment that has our brothers and sisters in other industries in a vice grip of difficult times, our agreement delivers more than just a 17 percent wage increase, a 6½-year cap on health care insurance premiums, certification pay, a faster process for new hires to reach full-pay rates and no work-rules give-backs.
The 17 percent wage increase is significantly higher than the rate of price inflation – giving you a greater boost in purchasing power than any other national contract in the past 40 years.
By contrast, President Obama imposed a two-year wage freeze on federal employees, and not a day passes without news of wage and health care givebacks in other industries.
Our $200 monthly cap on health care insurance contributions is less than half what federal workers currently are paying; and is more than $140 less than the average currently paid by private-sector workers.
Health care plan design changes deliver expanded and improved health care benefits, such as personalized medicine and access to centers of excellence – benefits we never before had. Personalized medicine assure you access to the most up-to-date health care products available; and centers of excellence means that if you or a family member suffers a serious illness, you gain access to the most advanced treatment center for that illness in America.
Sadly, other organizations – unable on their own to reach a national agreement — have attacked ours.
These other organizations ignore that neutral arbitrators have previously ruled that carrier profitability is not a valid reason for increasing wages. Moreover, the Surface Transportation Board has concluded that while rail profits are up sharply, the carriers remain revenue inadequate. Captive shippers, citing higher rail profits, have lost every argument before Congress to impose caps on freight rates.
These other organizations also ignore that presidential emergency boards merely make recommendations under the Railway Labor Act. Those recommendations are subject to amendment by Congress, and if we turn our fate over to Congress, it is the House Transportation & Infrastructure Committee that will be the committee of jurisdiction. The chairman of that committee is Rep. John Mica (R-Fla.).
In recent weeks, Chairman Mica has voiced opposition to union representation for Transportation Security Administration workers, advanced legislative language to privatize Amtrak and slash transit funding, and to overturn a National Mediation Board ruling assuring that a majority of those voting determine the outcome of airline and railroad representation elections. Rep. Mica wants the NMB to count as “no” votes anyone who does not cast a ballot.
In fact, if this agreement is rejected, and third parties determine our fate, the carriers will cite federal worker benchmarks – the wage freeze and far higher health care insurance premiums — to Congress. Everything we won in this agreement is off the table if we go to a presidential emergency board, with the carriers able to resort to their original Section 6 notice.
Brothers and sisters, this agreement deserves to be ratified on its merits. It delivers “more, now.”
Members of the UTU National Rail Contract Negotiating Committee, assisted by International officers and general chairpersons, are barnstorming the nation, holding face-to-face meetings with members to explain the tentative agreement and respond to questions.
The meetings began last week and continue through early August — prior to voting packages being mailed to some 38,000 members eligible to vote on the agreement.
A slideshow, shown at these meetings, provides an overview of the agreement; and a link to that slide show is found below.
A listing of meeting locations and dates can be found be clicking on another link, below.
A link also is provided to a webpage with additional information, including a link to the actual agreement.
Key points being explained to members include:
* The 17-percent wage increase is substantially higher than the rate of price inflation in 2010 and 2011, and the Department of Labor’s estimate of price inflation in subsequent years.
* The wage increase actually is 18.24 percent compounded, because each annual sequential wage increase is computed on the wage base increased by the previous year’s wage increase.
* This agreement exceeds the level of price inflation by more than any previous national rail agreement in the 41-year history of the UTU. Although the excess of the wage agreement over price inflation may appear greater in the 1970-1973 agreement (as shown graphically in a slide), that agreement didn’t account for cost-of-living adjustments; and there were givebacks, including changes in interdivision service, road-yard demarcation and run-throughs. There are no givebacks in the current tentative agreement.
* Price inflation, as computed by the Department of Labor, includes increases in costs of such items as food, autos, gasoline, clothing and other consumer goods and services. Wages that exceed price inflation provide members with greater everyday purchasing power.
* The $200 monthly cap on health care insurance assures that members will pay considerably less than is being paid by federal workers and workers in the private sector (as shown graphically in a slide). That slide also shows that were this agreement not ratified, and the existing formula for health care insurance premiums continued, members would pay considerably more than $200 monthly.
* Health care costs have been rising dramatically – more than doubling since 2000; and UTU member health care insurance premiums doubled from $100 monthly to $200 monthly in the previous agreement. This tentative agreement has provisions to help bring these costs under control, while improving the quality of health care (shown in several slides). Without bringing health care costs under control, members would face considerably higher premiums in future years.
* A significant provision in this tentative agreement maintains the $200 monthly cap for 6 ½ years, or 18 months beyond the reopening of the contract. There are certain to be increases in existing health care insurance premiums for federal workers and other private sector workers during this period – workers already paying considerably more than the $200 monthly cap provided in this tentative agreement.
* While it is alleged by some that the UTU National Rail Contract Negotiating Committee could have extracted more from the carriers owing to record-profits of major railroads party to the agreement, the fact is that carrier profitability has been ruled by neutral arbitrators not to be a valid reason for increasing wages.
* Said Arbitration Board No. 559 in 1996: “We do not think that ‘bigness’ alone or profits by themselves are permissive reasons for recommending wage increases … in our view, the union’s claim that current profit levels justify greater wage increases does not fly.”
* Were this agreement not to be ratified, third parties would decide. A presidential emergency board would consist of neutrals, all aware that President Obama froze wages of federal employees for two years, that federal employees’ health care premiums are more than double the $200 cap in this tentative agreement, that 46 million Americans have no health care insurance, and millions of unionized workers have suffered wage cuts, loss of health care benefits and loss of pensions.
* Presidential emergency board recommendations are subject to congressional amendment. The committee of jurisdiction will be the House Transportation & Infrastructure Committee, whose chairman, Rep. John Mica (R-Fla.), proposes eliminating Amtrak and slashing transit funding, and opposes union representation of Transportation Security Administration workers. Moreover, the anti-labor Republican leadership in the House proposes folding Railroad Retirement into Social Security and privatizing Social Security and Medicare.
* Historically, rail unions do poorly after rejecting tentative agreements. Many members recall the devastation in 1991 of PEB 219 recommendations, when two of the most labor-friendly lawmakers – Rep. John Dingell (D-Mich.) and Sen. Ted Kennedy (D-Mass.) — chaired the committees of jurisdiction.
* As National Legislative Director James Stem counsels: “This agreement provides significant financial improvement and economic stability for our families. Any other option would be a big gamble we cannot afford to take.”
To view the slide show, click on the following link:
A 17 percent pay increase, retention of the $200 monthly cap on health care cost-sharing, FRA certification pay, a faster process for new hires to reach full pay rates, and no rollback of the January 2011 cost-of-living adjustment (COLA) highlight the new five-year national rail agreement negotiated between the UTU and the National Carriers’ Conference Committee (NCCC).
Railroads represented by the NCCC include BNSF, CSX, Kansas City Southern, Norfolk Southern, Union Pacific and many smaller railroads. Some 38,000 UTU members, including yardmasters, are covered by the tentative new agreement.
UTU District 1 general chairpersons voted unanimously June 2 to submit the tentative agreement to the membership for ratification under the craft autonomy provisions of the UTU constitution. The general chairpersons also voted unanimously to recommend ratification.
General chairpersons now have until June 20 to submit questions regarding details of the tentative agreement. The questions will be submitted to the NCCC for answers. The agreed-upon questions and answers will become part of the tentative contract submitted to the membership for ratification.
Additionally, forums will be scheduled nationwide at which UTU International officers will brief members on the contract’s details and respond to member questions. A ratification vote will later be scheduled.
“In the 41-year history of the UTU, this wage increase is the highest in excess of the current and projected consumer price index,” said UTU International President Mike Futhey. The Consumer Price Index, or CPI, is a barometer of prices for goods and services as measured by the federal Bureau of Labor Statistics.
“Combined with the previous agreement this administration reached with the NCCC in January 2008, our members will realize a more than 40 percent increase in their base wages at the conclusion of this agreement, if it is ratified,” Futhey said. “A UTU member earning $80,000 in 2007 will be earning about $112,000 on the same job by 2015.”
The tentative agreement is retroactive to Jan. 1, 2010, and extends through Dec. 31, 2014. The contract provides that retroactive pay, commencing with the July 1, 2010, increase, will be made by the carriers within 60 days of the effective date of the final agreement.
The cap on employee health care cost contributions is a major provision of the tentative agreement. The $200 cap on monthly contributions compares with an average of more than $340 monthly paid by workers in other industries.
Without the negotiated $200 cap, and under provisions of current UTU agreements, UTU member health care cost contributions could soar to $355 monthly by 2015.
To retain the current $200 monthly cap, adjustments are made to copayments to reflect more economical ways to purchase medicines and reduce plan costs.
A new annual deductible is capped at $200 per individual ($400 per family), and an out-of-pocket maximum of $1,000 per individual ($2,000 per family) can be reached only if family medical costs exceed $40,000, which statistically affects only two percent of members.
The national rail agreement’s five-year entry rates provision has been amended to four years. Individuals under the five-year plan — as of May 1 and until the effective date of the final agreement — will receive a one-time $3,000 payment. Individuals on properties with modified service-scale rules will receive a one-time payment of $1,200. Individuals under entry-rate agreements that commence at 90 percent, and increase to 100 percent within two years, shall not receive a bonus payment.
Additionally, the tentative agreement provides that local agreements may be negotiated — not subject to binding arbitration if the sides cannot agree — for alternative compensation, compensated leave, compensation enhancement, and electronic bidding and bumping.
Yardmasters have essentially the same agreement, but with additional pay increases unique to their craft.
The UTU national negotiating team, in addition to Futhey, included Assistant President Arty Martin; National Legislative Director James Stem; UTU International Vice Presidents Robert Kerley and Delbert Strunk; and General Chairpersons John Lesniewski (CSX, GO 049), Pate King (NS, GO 680) and Doyle Turner (CSX, GO 347).
To read the tentative national agreements, select one of the links below:
Meetings are underway across the country to explain our tentative national rail agreement and provide members the opportunity to ask questions. Check with your local officers, general chairperson or state legislative director if you have not been notified of a meeting near you.
A listing of meetings also is provided on the home page at www.utu.org.
A voting package will be mailed by mid-May to members eligible to vote on the national agreement. A notice will be posted at www.utu.org when the packages — with voting instructions, the complete agreement, and questions and answers — are mailed. Voting will be via telephone and conducted by the American Arbitration Association.
In the meantime, information on the agreement is available on the UTU Web page, at www.utu.org, under a special link, “Railroad Contract Negotiations Update.”
Our tentative agreement improves on the pattern settlement, and general committees of adjustment still will be able to gain additional improvements on local issues.
Does the tentative national agreement provide everything we want? No. But the bottom line is that we can’t do better than we have achieved with this national agreement — but we could do worse.
Those of us who suffered through PEB 219 in 1991 recall what happened when we struck the railroads and Congress imposed the PEB recommendations.
Even though the House of Representatives was controlled by Democrats, Congress ended the strike within hours. The legislation forced on us the PEB 219 recommendations, which resulted in two-person crews and elimination of the fireman-helper.
The recommendations of PEB 219 were the final nail in the coffin eliminating brakemen and firemen-helpers — the nails and coffin provided by the carriers and the hammer by the first President Bush in selecting the members of PEB 219.
If we reject this agreement, we can expect that the improvements we gained over the pattern settlement would be dead-on-arrival at a Bush-appointed PEB.
That would mean we would lose the ability to keep the entry-rate issue on the table and correct it through arbitration, lose the higher meal allowance, lose the COLA, and lose a provision unique to our agreement that returns to us any health-care insurance-premium savings should Congress enact public-funding of health-care.
When you receive your May issue of UTU News in mid-May, we call your attention to four items:
The UTU budget is published, which delegates instructed us to do at the quadrennial convention last August.
There is an article on two of our younger leaders — Billy Moye and Carlos Wallace — who recently completed a course at the National Labor College in organizing strategies, which included principles of labor law, communication skills and fact-finding. Brothers Moye and Wallace will be taking those skills into the workplace to infuse in new members a full appreciation of what unions accomplish for members.
A feature continues that spotlights three UTU headquarters employees each month.
Another continuing feature spotlights two UTU designated legal counsel each month — skilled and experienced attorneys who understand the railroad industry, its safety hazards and every aspect of the Federal Employers’ Liability Act (FELA). Our designated legal counsel are chosen for their special knowledge and experience, and their job is to represent you if you are injured on the job.
Please take note that on the UTU Website, at www.utu.org, under the link for “Meetings,” there is complete registration information for our regional meetings in Denver and Nashville. Those meetings focus on education and interaction among members.
A highlight of this year’s regional meetings will be a presentation by Professor Jim McDonnell on labor history and the role of labor unions in creating a middle-class in America. As Professor McDonnell advises, labor cannot build for the future without fully understanding its past struggles, defeats and victories.
At UTU headquarters in Cleveland, we have been realigning jobs to make member services more efficient and cost effective — and without hurting any of our dedicated employees who are ably and proudly represented by the Office and Professional Employees International Union (OPEIU).
Finally, the 2008 annual sales meeting of the United Transportation Union Insurance Association will be held April 27-29 — the one annual event dedicated to training and educating our field supervisors and assistant field supervisors. It is a forum for the exchange of ideas and experiences related to existing and new UTUIA products and services.