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Surface Transportation Board Chairman Martin Oberman has seen some rail carriers cut jobs and neglect their infrastructure in pursuit of short-term profit, and he says there’s nothing to like about it.

Oberman spoke last week before the Southeast Association of Rail Shippers’ conference, and the “cult of the operating ratio” (OR) could be rising again with BNSF and Union Pacific cutting workers and a hedge fund looking to seize Norfolk Southern.

“These low OR — which could only be achieved rapidly — as the activists demanded — by cutting payroll — have meant lots of free cash which the Class Is have not been shy about paying out in stock buybacks, dividends, and in BNSF’s case, returns to its owner,” Oberman said. “The total in the last decade or so is over $250 billion — money which was not invested in retaining workers or building new infrastructure to increase a railroad’s reach and serve more customers.”

Billionaire Warren Buffett said as much in his recent letter to shareholders, expressing disappointment in BNSF’s latest returns. Union Pacific ousted a CEO in 2023 and the new one is doubling down on squeezing workers in the name of shareholder return.

SMART-TD members and rail workers have been coping with the consequences through job cuts, irresponsibly long trains and inhumane work schedules. For our members, “PSR” stands for “punishing and sadistic railroading.”

Starting in about 2014, more than 45,000 rail workers lost their jobs because of the quest for increased efficiency.

“Railroads are a regulated monopoly. They have a common carrier obligation to the public interest and to the nation’s economy,” Oberman said. “Unlike other businesses, railroad management and owners are not just free to manipulate the business by draining the company’s resources for short-term gain.”

Too often, the pro-free market crowd, overseeing spreadsheets from the comfort of their railroad offices, think that “free market” means “we can run our business however we want and do to workers and the communities we affect whatever we want. We’re here to make money, and they should be happy about it. They’re lucky we’re here.”

That mentality’s brought longer trains, fewer inspections and less emphasis on safety, as much as industry executives and mouthpieces like the Association of American Railroads and Railway Age claim the railroads are working in everyone’s best interests. PSR is only good for everyone who owns stock.

The industry’s shareholders cruised through the initial wave of PSR with fatter wallets and bigger dividends, Oberman noted in his speech. Contrast that with the thousands of workers who were sent home for the last time as service to their former customers suffered.

Investor neglect drew attention of federal regulators, including Oberman’s STB, after a post-COVID national supply chain meltdown. The STB held hearings on carrier performance in 2022 and has kept a close eye on carrier personnel levels since.

Recent events indicate carrier leadership is being guided back to its shortsighted ways. Investors demand quick profits at the exclusion of all else. Hundreds of jobs have been cut from BNSF and Union Pacific over the past weeks and months.

So when leaders such as Oberman and Federal Railroad Administrator Amit Bose decide to oversee the industry through a more skeptical lens, along with the workers and the members of the media, those folks in the comfortable offices get less comfortable.

Oberman also expressed his doubts about activist investor group Ancora’s plan to replace Norfolk Southern’s leadership with a who’s who of exploitative executives.

“Several weeks ago, Ancora wrote me a letter. The essence of their message was that they had taken a $1 billion dollar stake in NS in order for it — quote — ‘to become a safer railroad,’ ” Oberman said. “Really? What hedge fund raises $1 billion to promote safety anywhere? The measure of Ancora’s disingenuous pitch to improve safety is that its slide deck completely omits reference to FRA data which shows that, in the last year, NS has been an industry leader in reducing mainline rail accidents and derailments.”

SMART-TD members — the people who do the work — have lived through PSR. Oberman has gone through PSR, as has Bose. It was a failure for workers, shippers and catastrophic for the national supply chain. It’s not wanted by anyone or good for anyone except for those who would reap the most by doing the least.

The watchdogs of the industry — Oberman, Bose and SMART-TD — all recognize this. We do not want to go through it again.

UP and BNSF executives — you’ll need to get to work, because PSR doesn’t.

Read Oberman’s speech

Tags BNSF, precision scheduled railroading, STB Chairman Martin Oberman, Surface Transportation Board, Union Pacific

WASHINGTON, DC – The shop craft unions at Burlington Northern Santa Fe (BNSF) Railway are urgently calling upon the Federal Railroad Administration (FRA) to initiate unannounced focus inspections on all locomotives and rail cars owned and leased by BNSF Railway, and immediately issue non-compliance orders requiring BNSF to fix all found defects before being permitted to use such equipment, citing concerns over numerous defects that are allegedly being ignored and neglected by BNSF management.

The letter comes on the heels of BNSF’s recent announcement of over 362 furloughs in the shop craft unions, further exacerbating concerns over safety and maintenance practices. The defects and recent extreme cuts to the workforce pose serious safety risks to railroad operations and personnel.

Many furloughed employees may be forced to accept positions with lower pay and fewer benefits, potentially disrupting their lives and livelihoods.

In a letter addressed to FRA Administrator Amit Bose, the shop craft unions at BNSF highlighted their ongoing efforts to address safety and maintenance issues within the railroad industry. The letter referenced a meeting held on December 19, 2023, during which the shop craft unions presented evidence of significant workforce reductions within the mechanical departments of Class I freight railroads, including a staggering 41% decrease in employees since 2015.

Reports received by the shop craft unions indicate that BNSF managers that have been under pressure to perform work without an adequate number of workers, may have instructed workers to release locomotives and rail cars for service that have not been adequately inspected or repaired, effectively disregarding federally mandated safety inspections and fabricate of inspection reports, purportedly as part of cost-cutting measures aimed at maximizing shareholder profits.

“BNSF’s actions represent a reckless disregard for the safety and integrity of our nation’s railways,” said the shop craft unions. “BNSF has recently admitted in public filings that they would not be in compliance with federally mandated safety inspections, and we continue to be informed that BNSF has numerous FRA defects on their locomotives and rail cars. There is no shortage of profits for BNSF, and there is no shortage of work to be performed on BNSF equipment. There is simply an obscene shortage of workers and disregard for people at BNSF. By prioritizing cost-cutting over safety, BNSF is placing its employees and the public at risk. In light of these developments, we have urged the FRA to take immediate action to ensure the safety of BNSF operations. Random audits and focus inspections are essential to holding BNSF accountable and preventing further compromises to safety.”

The shop craft unions at BNSF are calling upon the FRA to prioritize the safety of railroad workers and the integrity of railroad operations by promptly conducting inspections of BNSF locomotives and rail cars located at or in transit to all BNSF Locomotive Maintenance Inspection Terminals (LMITs).

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The Shop Craft Unions are, in alphabetical order: The Brotherhood of Railroad Carmen Division, TCU/IAM (BRC), the International Association of Machinists and Aerospace Workers (IAM) , the International Brotherhood of Boilermakers (IBB), the International Brotherhood of Electrical Workers (IBEW), the National Conference of Fireman and Oilers, Local 32BJ/SEIU (NCFO), the International Association of Sheet Metal, Air, Rail and Transportation Workers Mechanical Department (SMART MD), the Transportation Communications Union (TCU) and the Transport Workers Union of America (TWU).

Tags BNSF, car inspection, FRA, Furloughs, inspections, Rail Mechanical and Engineering, rme

In November, SMART-TD members voted — with approximately two-thirds in favor — to ratify a tentative agreement the Transportation Division reached with BNSF in September.

“This agreement our general committees have reached with BNSF continues to show the strength of our union’s leadership. Together we have made unprecedented inroads on attendance and quality-of-life issues — an area carriers had no interest to collectively bargain,” said SMART-TD President Jeremy Ferguson. “We have cleared the way for our members on BNSF to expect predictability in their work rest schedules, while at the same time securing proper compensation on a variety of issues that were not agreed to in past rounds of national negotiations. It was long overdue that these issues be addressed. I’m very proud of everyone’s efforts to get this accomplished.”

Negotiations with BNSF under Articles VI and VII of the National Rail Agreement began in January following wide national attention on rail labor’s fight to improve rail workers’ quality of life. The tentative agreement with BNSF was reached by the eight affected SMART-TD general committees months later; votes were cast through the month of October and tabulated on November 2.

The general chairpersons involved include GO 001’s Mike LaPresta, GO 009’s Scott Swiatek, GO 017’s Rich O’Connell, GO 020’s Justin Schrock, GO 386’s Larry Miller, GO 393’s Kevin Kime, GO 577’s Roy Davis and Tony McAdams from GO JTD.

Under the next phase of this process, SMART-TD and BNSF will begin implementing the agreed-upon changes. Members who are eligible for additional vacation will have the opportunity to schedule that vacation in 2024. Implementation of other provisions of the agreement will take place over the coming weeks and months.

“We would like to thank our members for their patience throughout the negotiation process, and for casting their votes,” the eight general chairpersons of the involved committees said in a joint statement. “The overwhelming approval ratings prove that our members see the value in this agreement. We were determined to obtain meaningful improvements to our working conditions, and this agreement does exactly that. While our fight is never over, we are confident that this will serve as a substantial step in the right direction.”

The general chairpersons also expressed appreciation to Vice President Joe Lopez, who helped lead negotiations, along with Vice Presidents Chad Adams and Jamie Modesitt.

“Our general chairpersons showed exemplary leadership and cohesion through the up-and-down nature of these discussions,” the three vice presidents said. “We congratulate them on their accomplishments and commend them on their focus on what matters — improving the quality of life and working conditions of our members.”

Tags BNSF, Journal, SMART TD, tentative agreement, Winter 2023-24, Winter Journal

Phone: (216) 228-9400

Fax: (216) 228-0411

Department Email: news_td@smart-union.org

INDEPENDENCE, Ohio (Nov. 3, 2023) — SMART Transportation Division (SMART-TD) members working under the proposed agreement voted, with approximately two-thirds in favor, to ratify a tentative agreement the union had reached with BNSF in late September, union leadership announced today.

Negotiations with BNSF under Articles VI and VII of the National Rail Agreement began in January following wide national attention brought by the fight of rail labor led by SMART-TD, the nation’s largest freight railroad union, to improve rail workers’ quality of life. The tentative agreement with BNSF was reached by the eight affected SMART-TD General Committees in late September. Votes were cast through the month of October and tabulated Nov. 2, 2023.

Additional information and details regarding the agreement can be found at this li nk.

In a joint statement, the eight general chairpersons of the involved committees had this to say about the tentative agreement:

“We would like to thank our members for their patience throughout the negotiation process, and for casting their votes. The overwhelming approval ratings prove that our members see the value in this agreement. We were determined to obtain meaningful improvements to our working conditions, and this agreement does exactly that. While our fight is never over, we are confident that this will serve as a substantial step in the right direction.”

— TD General Chairpersons representing BNSF members

The general chairpersons also expressed appreciation to Vice President Joe Lopez, who helped lead negotiations, along with Vice Presidents Chad Adams and Jamie Modesitt. The VPs made the following joint comment:

“Our general chairpersons showed exemplary leadership and cohesion through the up-and-down nature of these discussions,” the vice presidents said. “We congratulate them on their accomplishments and commend them on their focus on what matters — improving the quality of life and working conditions of our members.”

“This agreement our General Committees have reached with BNSF continues to show the strength of our union’s leadership. Together we have made unprecedented inroads on attendance and quality of life issues — an area carriers had no interest to collectively bargain,” said SMART-TD President Jeremy Ferguson. “We have cleared the way for our members on BNSF to expect predictability in their work rest schedules, while at the same time securing proper compensation on a variety of issues that were not agreed to in past rounds of national negotiations. It was long overdue that these issues be addressed. I’m very proud of everyone’s efforts to get this accomplished.”

Tags BNSF, GO 001, GO 009, GO 017, GO 020, GO 386, GO 393, GO 577, GO JTD, SMART Transportation Division President Jeremy Ferguson, Vice President Joe Lopez

“Our rail members from BNSF properties definitely had their voices heard in this process and they should be proud to see their fingerprints throughout this outstanding TA. They were very clear that they wanted a level of predictability for when their time off would be honored, and they wanted a predictable and non-punitive method of filling vacancies that directed the assignment to those who wanted the work and was not aimed at punishing those who aren’t willing to work off of their turns. This TA that our eight General Chairpersons fought for does both. Not only will our brothers and sisters get more compensated time off, but it will be less of a moving target. This is another big step ahead for SMART-TD and our BNSF members.”

— SMART-TD President Jeremy Ferguson

SMART-TD is proud to announce that a tentative agreement has been reached between our General Committees and the Burlington Northern Santa Fe Railroad (BNSF). This agreement has been in the works since January 18, 2023, and is highlighted by many upgrades to the quality of life for our members.

All eight SMART-TD General Committees representing our BNSF properties have reached tentative agreements with the carrier and have already sent the details to their local chairpersons for distribution to their members for consideration.

The general chairpersons involved included GO-001’s Mike LaPresta, GO-009’s Scott Swiatek, GO-017’s Rich O’Connell, GO-020’s Justin Schrock, GO-386’s Larry Miller, GO-393’s Kevin Kime, GO-577’s Roy Davis, and Tony McAdams from GO-JTD.

The tentative agreements for each of the eight General Committees are founded on the same language while still giving each General Committee the flexibility to adapt the terms to fit the unique needs of their specific members. The following is a synopsis consistent for all eight of the committees.

Extra boards: Allowed to keep road and yard separate under new conditions under Section V.
6th week of vacation for 25 year or more employees.
Up to two weeks of vacation can be selected as float weeks.
PRE-layoff for all single PLD/VAC, weekly VAC and EDO days.
Continuous-held-away after 16 hours for everyone on every pool.
Extra Paid Sick Leave Day. (5 total w/same option of converting 3 PLD/VAC to total 8)
Earned Day Off: With no unpaid layoffs in a 90-day period, earn one anytime day unpaid to lay off.
Turn swapping on pools that elect this option,
Preventive care days now available to assigned jobs.
Bereavement leave changes to expand the scope of what relationships qualify for bereavement as well as creating additional flexibility as to when bereavement can be used.
Increased new-hire training from 13 weeks to 14 weeks with additional time allotted in terminals that have RCO operations.
All Reduced Entry Rates or Tiers eliminated for all properties. Everyone will be at 100%.
Student and trainer pay rate increases.

Additional details tailored to the members of each General Committee will be included with membership ratification instructions, which are currently scheduled to be mailed to eligible voters on Tuesday, October 3rd. For those members who have email addresses and telephone numbers on file with SMART-TD, electronic notifications and voting instructions will also be sent. Tabulation of the ratification votes will occur on Thursday, November 2nd, and results will be announced soon after.

In a joint statement from the eight general chairpersons of the involved committees, the GCs had this to say about the tentative agreement.

“Our goals for this TA were to defend the separation of the road and yard extra boards and to bring predictable guaranteed time off for our members regardless of their assignment or board. We believe we achieved these goals and significantly more. This TA has come a very long way from where it started back in January. The eight of us and our committees fought hard to finally get it to a point where the TA is worthy of ratification. None of us thought it was possible initially, and up until very recently, we thought it was destined to go to arbitration. But we are excited about the agreement we are putting out to the members for ratification. We would also like to thank Joe Lopez, who was the SMART-TD vice president assigned to this project, along with Vice Presidents Chad Adams and Jamie Modesitt for their assistance over this long nine-month process. Joe Lopez, in particular, went out of his way to shepherd this TA through the many highs and lows in the process. We all appreciate their dedication to the process and to the quality of life this TA has the potential to bring to our members.”

— SMART-TD General Chairpersons representing BNSF crew bases

In a combined statement from the three vice presidents who were involved in this negotiation, Lopez, Adams, and Modesitt were quick to give the 8 GCs the praise, saying, “The ability of this group of general chairpersons to stick together for the benefit of all is a true testament to brotherhood. Maintaining the same course for eight general chairpersons is no easy task, but this group successfully did it. Their effort and hard work were the difference between securing a tentative agreement and leaving the final outcome in the hands of a third-party arbitrator.

“As a group, we are proud to send this TA to the members for a ratification vote. We know that we got every inch of quality-of-life improvements out of this agreement. It’s our belief that our BNSF members are going to have more time off with their loved ones. They won’t get called right before their day off, forcing them to continuously cancel and change their family’s plans, and when they have this time away from the rail, they’ll have a little more in their pockets on top of it. All the way around, this is a good development for our men and women, and we couldn’t be more excited for them.”