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As members of SMART-TD, the largest rail union in the United States, it is disheartening to observe the media coverage surrounding the departure of Alan Shaw, as president and CEO of Norfolk Southern. The Wall Street Journal, CNBC and others focused on the implications for the stock price and the catalyst for his resignation. Glaringly absent, and far more important, is the discussion of how Shaw’s departure will impact Norfolk Southern’s safety improvements, quality of life for their employees, and the railroad’s shaky relationship with the communities affected by the company’s operations.

SMART-TD would like to underline three points for the new administration:

1. The Future of Safety Improvements: Under Shaw’s leadership, Norfolk Southern made notable strides in improving its safety culture. However, there has been no coverage of what will become of these safety initiatives. It is essential for the industry and the public to know whether the development of robust safety protocols and their enforcement will continue or falter under new leadership.

2. Job Security for Rail Workers: Shaw had pledged to refrain from laying off the workforce of NS during economic downturns. Our interests align: This assurance meant stability for many rail workers, and an accelerated return to capacity for NS when business accelerates. A failure to address whether this promise will be upheld is concerning. Rail workers and NS customers deserve to know if those commitments made by Shaw will still be honored.

3. Involvement of Rail Labor Organizations: Shaw committed to involve labor while revitalizing Norfolk Southern’s safety and training programs. This collaborative approach improves working conditions and safety standards. Rail workers have a vested interest in developing safety training, as our lives and limbs are easily lost if safety is neglected. There has been no mention of how this leadership change will affect this commitment to these or to the groundbreaking C3RS pilot program.

Preoccupation with stock prices and financial impacts and a neglect of the broader human and community elements in the discussion of the leadership change underscore a troubling trend. Shareholder interests should be balanced with — not prioritized at the expense of — worker safety and community well-being.

Railroad companies with records dating back to the 1800s should realize that safety plus good employee relations equals improved customer service. Providing superior service is how to grow a business. Shaw’s commitments benefited all involved and the company’s rebound indicated this.

With the announcement of current CFO Mark George taking over as president and CEO of Norfolk Southern, SMART-TD is optimistic that the positive momentum established under Shaw will continue.

George is no stranger to the realities of the industry, or the improvements NS has realized by distancing itself from Precision Scheduled Railroading. It is our hope that we can work together to continue bettering the safety and quality of life for the men and women of Norfolk Southern.

The SMART Transportation Division began a new era in rail safety and worker protection by working with Norfolk Southern to accept and act on anonymous safety reports.

How It Works

The one-year pilot program, called the Confidential Close Call Reporting System (C3RS), is similar to one that airline personnel use to hold their airlines accountable. Rail workers will share safety concerns through a secure website. NASA, acting as an independent party, will organize, anonymize and share the reports with the Federal Railroad Administration (FRA). Under FRA guidance, improvements will be made by a joint committee including SMART-TD and other rail labor representatives, as well as Norfolk Southern management.

A Long Time Coming

C3RS first came to the rail industry in 2007, when SMART-TD predecessor United Transportation Union (UTU) and Union Pacific (UP) participated in an early version, running until 2013. They piloted the system in Bailey Yard, North Platte, Nebraska, the largest rail yard in the world. The program was highly successful: It increased safety and reduced critical incidents and rule violations. The program also greatly decreased employee discipline. Other Class III and passenger rail carriers began to benefit from the system around the same time.

The program requires voluntary agreement among the rail carrier, labor and the federal government. Despite its success, UP refused to renew the program, effectively killing it. SMART-TD has engaged in an ongoing effort to reintroduce the program at all Class I carriers.

We Have Only Begun to Fight

After our 17-year effort, Norfolk Southern (NS) decided to take the lead on rail safety, and this C3RS agreement shows that CEO Alan Shaw is serious in his commitment to making NS the safest railroad by partnering with rail labor. SMART-TD President Jeremy Ferguson and General Chairpersons Tommy Gholson, James Ball, David Phillips, Dan Weir and Joe Borders began making real progress with NS executives in 2023, resulting in a signed agreement on February 15, 2024.

“For years we’ve watched the successes of the several shortlines that have practiced under C3RS, and because of that, for years, we’ve long been advocates,” said Gholson, who was instrumental in negotiating the pilot program.

Gholson also praised the efforts of the four other general chairpersons for their roles in constructing the C3RS framework. Alternate National Legislative Director Jared Cassity provided leadership by being a facilitator in the process and coordinating with the FRA.

SMART-TD: Out in Front

In a speech soon after the agreement’s signing, Ferguson said: “Rail labor has been out in front since the beginning. We have always advocated for the right to have a protected avenue to report safety concerns and injuries without fear of harassment, intimidation or retribution.

“For far too long, this nation’s rail carriers have been complacent with their approach to safety. Obviously, this is something that can’t be reversed overnight, but we are hopeful that the corrective process can begin with a program like C3RS.

“There is no higher priority for SMART-TD or the workers we represent than safety, not just for their own welfare but also for the communities in which they operate.”

“This is a good day for the men and women on the ballast line of Norfolk Southern! The attempt by the hedge fund known as Ancora to take over one of this country’s largest railroads could have been catastrophic to our nation’s economy and to the quality of life for thousands of SMART-TD members.

Surface Transportation Board Chairman Martin Oberman and Department of Transportation Secretary Pete Buttigieg supported NS’s management team because they recognized the threat the Ancora plan posed to rail workers’ safety and quality of life. These leaders’ support for current leadership’s course was not just an endorsement of the recent changes at NS. It was also a rebuke of the destructiveness of Precision Scheduled Railroading.

With two notable exceptions, rail labor leaders saw this scenario for what it was. The majority of us remained in support of the new course set by Alan Shaw and his board. Those others allowed themselves to be taken in by an empty promise.  Thankfully, today all railroaders can be assured that the progress they have witnessed in their quality of life, and the security they and their families count on from their paychecks are no longer at dire risk. Wall Street’s attempt to go back to the Hunter Harrison playbook has failed.

As the president of the largest union on Norfolk Southern’s properties and the largest in the U.S. rail industry, I look forward to continuing SMART-TD’s work with Alan and his team to improve the lives of our rail workforce and to continue to blaze a trail for all Class I railroads to follow.”

Jeremy Ferguson, President, SMART-TD

INDEPENDENCE, Ohio (May 9, 2024) — SMART Transportation Division President Jeremy Ferguson issued the following statement on the results of the Norfolk Southern proxy vote:

“This morning, a rare thing happened with the NS vote. Corporate raiders failed to take the reins of an essential player in the rail industry and veer this nation’s economy back into the bad old days of Precision Scheduled Railroading.

“Ancora’s attempt to railroad the railroad and ‘tear Norfolk Southern down to the studs’ has officially failed. A balanced approach, with particular emphasis on rail safety, will continue there.

“SMART-TD looks forward to continuing the progress we have made with CEO Alan Shaw and his team. They have been establishing a resilient approach to railroading and an improved workplace culture. NS has decided to place the safety of our members and the communities they run through at the forefront, and we are excited to see that this will continue!”

David Philips, SMART-TD General Chairperson for General Committee 680 stated:

“Committee 680 is pleased to hear the outcome of today’s NS proxy vote and plans to continue the progress we have made for our members. Now that the leadership at NS is stable, it strengthens our future negotiations and paves the way to good outcomes for our members.”

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If you’re interested in speaking more about Norfolk Southern and the impact of today’s shareholder vote, we’d be happy to connect you with:

SMART Transportation Division President Jeremy Ferguson

President Jeremy Ferguson, a member of Local 313 in Grand Rapids, Mich., was elected president of SMART’s Transportation Division in 2019.

President Ferguson, an Army veteran, started railroading in 1994 as a conductor on CSX at Grand Rapids, Mich., and was promoted to engineer in 1995. Ferguson headed the recent national rail negotiations for the Union with the nation’s rail carriers.

SMART Transportation Division Alternate Vice President Thomas Gholson

Thomas “Tommy” Gholson, of Local 573 in Danville, Ky., has worked for Norfolk Southern since 1998, first as a brakeman, then as a conductor and as an engineer.

Gholson has served as general chairperson for GO 898 since 2018 and became a SMART-TD alternate vice president in October 2019. He also serves as vice chairperson of the Association of General Chairpersons, District 1.

In conjunction with multiple union officers, Brother Gholson assisted in the negotiation of the national railroad contract talks that opened in 2019. He also served on the Work-Rest Subcommittee and was a driving force behind the work that led to NS joining the Confidential Close Call Reporting System (C3RS).

The SMART Transportation Division, as the nation’s largest freight railroad union, reasserts its support of Alan Shaw and the leadership at Norfolk Southern.

CEO Alan Shaw and his management team have focused on creating a resilient carrier. They have made a conscious effort to diverge from the operating ratio-obsessed mentality that has degraded rail service and safety since 2017, and have made safety, employees and customers their priority.

The vast majority of rail labor, including SMART-TD and the coalition Transportation Trades Department of the AFL-CIO, recognizes this effort. The recent announcements by the BMWED and BLET unions that they are willing to roll the dice with a group wanting to re-implement an operating mode that contributed to a national supply-chain crisis and puts safety and employee well-being at risk is puzzling.

Under present leadership, NS is cooperating with the National Transportation Safety Board in a thorough safety review. This comes after the carrier became the first Class I to commit to the Confidential Close Call Reporting System (C3RS). Shaw and NS also became the first Class I to reach paid-sick leave agreements with all bargaining units — an accomplishment that some other Class I carriers operating in the U.S. still haven’t achieved.

Shaw and the current leadership team have taken solid, tangible steps to establish a safety culture that values the contribution of our union members and officers, while also improving Norfolk Southern’s operations at the same time. The challengers seeking to take over the carrier have provided flimsy rhetoric to try to sway shareholders and that has swayed the BMWED and the BLET. At the same time, Shaw and his team continue to work to create results for labor, management and customers.

We have supported Norfolk Southern CEO Alan Shaw and his team since the activist shareholders announced their intent. As the nation’s biggest freight rail union, we continue to do so and we will not waver.

Read a release by the 11-union group including SMART pledging support for the NS leadership.

Joint pilot program encourages railroaders to confidentially report safety concerns

SMART Transportation Division officers flank TD President Jeremy R. Ferguson (center), NS CEO Alan Shaw (left of Ferguson) and FRA Administrator Amit Bose (right of Ferguson) at Thursday’s signing ceremony in Atlanta.

ATLANTA (February 15, 2024) – Norfolk Southern Corporation (NYSE: NSC), the International Association of Sheet Metal, Air, Rail and Transportation Workers – Transportation Division (SMART-TD) and the Brotherhood of Locomotive Engineers and Trainmen (BLET) along with the Federal Railroad Administration (FRA), signed an agreement Thursday to participate in the FRA’s Confidential Close Call Reporting System (C3RS).

The signing ceremony was held at the Atlanta offices of the U.S. Department of Transportation. With attendees from Norfolk Southern, the unions and FRA leadership, the ceremony officially kicked off the one-year partnership.

Norfolk Southern is the only Class I railroad participant in the program, which the company committed to in 2023. As part of the C3RS pilot program, covered Norfolk Southern employees can report safety concerns confidentially.

Railroaders at the company’s Atlanta; Elkhart, Indiana; and Roanoke, Virginia locations will participate in the pilot. Reports will be reviewed by a joint committee composed of Norfolk Southern and labor representatives, who will identify and implement safety improvements with the FRA’s guidance.

C3RS-Signing-Release-2-13-2024-v7Download

About Norfolk Southern
Since 1827, Norfolk Southern Corporation (NYSE: NSC) and its predecessor companies have safely moved the goods and materials that drive the U.S. economy.

Today, it operates a customer-centric and operations-driven freight transportation network. Committed to furthering sustainability, Norfolk Southern helps its customers avoid approximately 15 million tons of yearly carbon emissions by shipping via rail. Its dedicated team members deliver more than 7 million carloads annually, from agriculture to consumer goods, and Norfolk Southern originates more automotive traffic than any
other Class I Railroad. Norfolk Southern also has the most extensive intermodal network in the eastern U.S. It serves a majority of the country’s population and manufacturing base, with connections to every major container port on the Atlantic coast as well as to major ports in the Gulf of Mexico and Great Lakes. Learn more by visiting www.NorfolkSouthern.com.
Media Inquiries: media.relations@nscorp.com

About SMART Transportation Division
SMART Transportation Division is comprised of approximately 125,000 active and retired members who work in a variety of different crafts in the transportation industry. These crafts include employees on every Class I railroad, Amtrak, many shortline railroads, bus and mass transit employees and airport personnel. Media contact: news_TD@smart-union.org

About BLET
The Brotherhood of Locomotive Engineers and Trainmen represents nearly 51,500 professional locomotive engineers and trainmen throughout the United States employed in both freight and passenger rail. Founded in 1863, BLET is the oldest union in the United States. The BLET also is the founding member of the Rail Conference, International Brotherhood of Teamsters.

“From the Ballast” is an open column for SMART Transportation Division rail members to state their perspective on issues related to the railroad industry. Members of the union are encouraged to submit content by emailing to news_TD@smart-union.org. Columns are published at the union’s discretion and may be published in the SMART-TD newspaper.

Most of us with any amount of time on the railroad have the shared experience of feeling the hot seat that comes with a company discipline hearing. These kangaroo courts are not set up to be fair and impartial fact-finding missions.  As we all know, they are an exercise in intimidation meant to make us feel as uncomfortable as possible. If they can add the bonus of humiliation on top of the penalty they’re threatening to impose, it makes the experience so much better.  

The U.S. Senate’s Committee on Environment and Public Works’ hearing March 9 put Norfolk Southern CEO Alan Shaw in our shoes for once (and not that pair of work boots he acquired to look like a relatable guy when the cameras were filming him in East Palestine, Ohio). For once, the so-called “big boss” got to experience the discomfort and frustration of when people in authority demand an explanation and accountability. It was very reminiscent of how we feel in similar situations when we’re getting grilled by railroad managers like Shaw.  

It was hard to feel any sympathy. Yet while every senator seemed poised to force Shaw’s hand, each stopped just short of going in for the kill. Those who did ask hard questions were given lukewarm half-answers — snippets from the well-rehearsed lines that he has been using since the derailment happened. He appeared like he was simply spinning his greatest hits album of the soundbites that scored highest in a focus group. 

Based on the fact that the hearing went for over a third of the time a rail crew has off between shifts these days, most members likely didn’t have the opportunity to watch. In an effort to put a bow on it, the hearing broke down like this: 

CEO Shaw was asked about as many questions as you could fit into the 3-hour, 19-minute hearing but somehow managed to answer every one of them with one of the following responses on a loop.  

  • I have only been the CEO since May 2022. 
  • I am personally determined to make this right for the community of East Palestine. 
  • Norfolk Southern will be in East Palestine tomorrow, next month, next year, and ten years from now. 
  • We created a new website in response to the disaster. 

After seeing his performance, (and that was exactly what it was) I would offer Mr. Shaw some advice. First, he should hire a new acting coach to help him get through these situations. His entitled angry Wall Street CEO reality leaked through the repentant empathetic “Mother Teresa” persona that he was trying to adopt before the panel as penance for the misery that’s occurred in East Palestine.  

Second, I would advise him to learn the value of direct answers. He was asked yes/no questions time and time again and offered answers that went on for minutes at a time and somehow did not include either of those two words to definitively answer what was asked.  

Since the senators were allotted a limited amount of time for their questions, Shaw was successful in running out the clock by playing a version of corporate prevent defense. But where he succeeded in not being pinned down to anything that could be held up in court as a commitment, he failed to move the needle in the court of public opinion. His wishy-washy answers, devoid of authenticity, full of unwillingness to commit to substantive industry change away from Precision Scheduled Railroading, and the recurring theme of “we’ll consider throwing more money at the problem we created,” clearly angered the senators on the Committee of Environment and Public Works. We will see what effect they have on the all-important shareholders of Norfolk Southern. His appearance did nothing to inspire the confidence of SMART Transportation Division.  

Among some of the questions from the senators that Shaw artfully dodged were: 

  • What did NS learn from the 20th derailment that resulted in a chemical release since 2015 that it didn’t learn from the 5th, the 10th, or the 15th? — Sen. Debbie Stabenow (D-Michigan) 
  • Will you lead the rail industry in getting away from the business model known as Precision Scheduled Railroading? — Senator Bernie Sanders (I-Vermont) 
  • Was the owner of the rail car in question who is responsible for its maintenance and contents involved in the decision to vent it and burn off the contents of it? — Sen. Markwayne Mullin (R-Oklahoma) 

One last highlight came from Sen. Sheldon Whitehouse (D-Rhode Island). It wasn’t posed as a question, but in Whitehouse’s comments, he stated that, “Mr. Shaw, the news is reporting that there has just been a significant derailment in Alabama of one of your trains. I certainly hope that all of your team and anyone in the vicinity is safe and well. You may need to look into that.” 

Though the net result of the hearing was minimal, CEO Shaw came out of it looking highly frustrated, but less than trustworthy. He was clearly uncomfortable being held accountable for the unintended but inevitable consequences of his company’s embrace of PSR.  

What left me with an uncomfortable feeling was that Shaw continually framed all the promises made to East Palestine and surrounding communities as “personal commitments.” As anyone on the rail can tell you, nothing is true or real in this industry until it is. There is no such thing as a guarantee. With all of the commitments coming from Shaw personally, it raises the question of what happens if NS fires him?  

Likely, he’ll float away comfortably from East Palestine on his golden parachute, make a comfortable landing elsewhere — maybe as an industry lobbyist — and the Ohio village residents he testified to have such an affinity with would be left holding a bag full of empty promises, just like every one of us railroaders with wallets full of unfulfilled IOUs from Class I managers. 

Daniel Banks is a Class I certified conductor and government affairs representative for the SMART Transportation Division.