here - Pennsylvania Federation BMWED-IBT

In The Matter Of: IN THE MATTER OF AMTRAK AND PRLBC

ARBITRATION HEARING Vol. 1 January 6, 2014

Original File 0106141AMLB01.txt

Min-U-Script®

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BEFORE THE AMTRAK/PRLBC ARBITRATION BOARD IN THE MATTER OF

) ) NATIONAL RAILROAD PASSENGER ) CORPORATION (AMTRAK) ) ) and ) ) BROTHERHOOD OF MAINTENANCE OF ) WAY EMPLOYEES (BMWED), affiliated ) with TEAMSTERS RAIL CONFERENCE, ) INTERNATIONAL BROTHERHOOD OF ) TEAMSTERS ) ) and ) NMB NO. A-13638 ) BROTHERHOOD OF RAILROAD SIGNALMEN,) AFL-CIO(BRS) ) ) and their representative ) ) PASSENGER RAIL LABOR ) BARGAINING COALITION (PRLBC) ) The hearing in the above-entitled matter commenced on the 6th day of January, 2014, at 10:01 a.m., at the offices of Morgan Lewis & Bockius, LLP, 1111 Pennsylvania Avenue, NW, Washington, DC. BEFORE:

IRA JAFFE, ESQ. CHAIRMAN HERBERT FISHGOLD, ESQ. SHYAM DAS, ESQ.

Inabnet Court Reporting (703) 331-0212

2

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ON BEHALF OF THE PASSENGER RAIL LABOR BARGAINING COALITION (PRLBC):

2 3 4 5 6 7

ROLAND P. WILDER, JR., ESQ. STEPHEN J. FEINBERG, ESQ. Baptiste & Wilder, P.C. 1150 Connecticut Avenue, NW, Suite 315 Washington, DC 20036 (202) 223-0723 [email protected] [email protected] ON BEHALF OF NATIONAL RAILROAD PASSENGER CORPORATION (AMTRAK):

8 9 10 11 12 13

THOMAS REINERT, JR., ESQ. DONALD L. HAVERMANN, ESQ. JONATHAN C. FRITTS, ESQ. Morgan Lewis & Bockius, LLP 1111 Pennsylvania Avenue, NW Washington, DC 20004 (202) 739-5084 [email protected] [email protected] [email protected]

14 15 16 17 18

COURT REPORTER:

JOSEPH INABNET INABNET COURT REPORTING (ICR) 9250 Mosby Street, Suite 201 Manassas, Virginia 20110 (703) 331-0212 [email protected]

19 20 21 22


3

1 2

WITNESSES

3

CHARLES WOODCOCK:

4

Direct examination by Mr. Reinert . . . . . . 69 Cross-examination by Mr. Wilder . . . . . . . .160 Redirect examination by Mr. Reinert . . . . . . 212 Recross-examination by Mr. Wilder . . . . . .215 Further recross by Mr. Wilder . . . . . . . . .231

5 6 7 8 9 10

EXHIBITS (All Exhibits premarked and preadmitted)

11 12 13 14 15 16 17 18 19 20 21 22


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P R O C E E D I N G S

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ARBITRATOR JAFFE:

And I would like to

3

note for the record that this proceeding is an

4

interest arbitration taking place pursuant to a

5

September 6, 2013 Interest Arbitration Agreement

6

executed by the parties.

7

They have also reached a variety of

8

procedural and ground rules agreements, which were

9

also placed in writing and submitted to the Board

10

prior to this morning's hearing.

11

The parties also docketed, in accordance

12

with that agreement, several hundred exhibits, and

13

they are all deemed admitted as part of the record.

14

In addition, we'll lay out the usual

15

ground rule.

If there's anything else that's marked

16

during the course of the proceeding, it is

17

presumptively admitted subject to any objection that

18

might be raised to the Board that the Board

19

sustains.

20

Before we get to opening statements, if I

21

could ask those in the room who have cell phones or

22

similar devices to at least try and make certain


5

1

that they're on silent mode, if not turned off.

2

That will probably at least limit the unexpected

3

interruptions in the proceedings today.

4

And it's my understanding that the carrier

5

will be opening first.

6

MR. REINERT:

7

ARBITRATOR JAFFE:

8

At your convenience, Mr. Reinert.

9

MR. REINERT:

10

Reinert.

11

Passenger Corporation.

12

That is correct. Okay.

Good morning.

I'm Thomas

I represent the National Railroad

I want to welcome you all to our offices

13

at Morgan Lewis, and I hope that this facility

14

proves appropriate and comfortable for this hearing.

15

As an initial matter, I want to thank the

16

board members, Mr. Jaffe, Mr. Fishgold, and Mr. Das,

17

for undertaking this case.

18

This is an important case for Amtrak.

19

It's an important case for the BMWED and the BRS.

20

And we appreciate both your willingness to take this

21

case and to accommodate us with respect to schedule

22

to get it scheduled in a concise period where we can


6

1

put the case on effectively.

2

Chairman Jaffe made reference to ground

3

rules and procedural issues.

4

engaged in working with the parties for some months

5

now to ensure that procedural issues were resolved

6

as much as they could be prior to the hearing, and

7

that process has been very effective.

8 9 10

He, in fact, has been

I would also like to just say a word of thanks to the PRLBC Council, Roland Wilder and Stephen Feinberg.

11

We have worked cooperatively in preparing

12

this case in many ways going back to the negotiation

13

of the Interest Arbitration Agreement, the ground

14

rules, the joint exhibits, all the procedural issues

15

which are, for both parties' interests, going to

16

expedite and make this proceeding simpler, more

17

efficient.

18

It's good to have a professional

19

relationship with opposing counsel that enables us

20

to facilitate issues.

21 22

I would also, on behalf of Amtrak, want to say a word of thanks to the leadership of the BMWED


7

1

and the BRS for agreeing to this interest

2

arbitration process.

3

Interest arbitration, we believe, will

4

prove to be the best way to resolve this round,

5

which needs to be resolved.

6

alternative than a Presidential Emergency Board.

7

think we all recognize that, given the political

8

environment, that it was best not to push these

9

issues to either the President or Congress, but

It is a better

10

attempt to resolve them through this interest

11

arbitration procedure.

12

And I think that that agreement between

13

the parties is the beginning of a process that we

14

hope leads to an overall Collective Bargaining

15

Agreement resolution.

16

I

We have a number of rank and file of BMWE

17

and BRS members present here today, as well as a

18

number of issues -- number of folks who hold Union

19

positions.

20

At the outset, I would like to say Amtrak

21

recognizes your contribution to the railroad.

22

are skilled workers.

Your jobs are physically


You

8

1

challenging, and you perform an important role in

2

maintaining and rebuilding the infrastructure of

3

Amtrak, which is in need of both maintenance and

4

rebuilding.

5

That obviously, does not mean that Amtrak

6

can agree with your labor organization's demands on

7

all issues.

8 9

We are in a collective bargaining process that has lead to this legal proceeding that's an

10

adversary proceeding.

And you will, in the course

11

of today and the next couple of weeks, hear two

12

conflicting positions.

13

You will hear many things said by me and

14

other counsel for Amtrak and Amtrak witnesses with

15

which you are certainly going to disagree.

16

You should not read any of that

17

disagreement, however, as in any way disrespecting

18

your work or your contribution, which Amtrak values.

19

It is a disagreement that's inherent in this

20

process, and this process is a means to get to

21

resolution.

22

I do want to take a moment to introduce


9

1

the Amtrak team and the Morgan, Lewis, Bockius team

2

that's here today.

3 4

To my right is Charlie Woodcock, who is the senior labor relations officer for Amtrak.

5

You will be hearing later this week and

6

seeing Bruce Pohlot, who is the chief engineering

7

officer.

8

officer, and Joseph Boardman, the CEO of the

9

railroad.

10

D.J. Stadtler, who is the chief operating

On our side, this has been a cooperative

11

effort between an Amtrak and a Morgan Lewis legal

12

team.

13

the right of Charlie Woodcock, who is the managing

14

deputy general counsel.

15

Bloom, who is senior associate general council.

16

Their paralegal, Amy Flynn, from Amtrak is in the

17

room right behind them.

18

From Amtrak Legal, we have Phil Hermann to

And to his right is Tom

Our Morgan Lewis team consists of me and

19

two of my partners, who will be examining witnesses

20

Don Havermann and Jonathan Fritts at the end, but

21

we're really backed up by a team of junior lawyers

22

who do most of the work, quite frankly.


10

1

And we have David Broderdorf, Kirsten

2

White, and Dave Larson, who you have either seen or

3

heard from in the course of this proceeding.

4

We thank them, and I thank them

5

personally, for their efforts in getting us here

6

today.

7 8 9

Before I begin my substantive comments, I want to talk a moment about this process. This interest arbitration is in lieu of a

10

Presidential Emergency Board.

11

parties have agreed to from day one of the

12

discussions in a mediation where the idea of

13

interest arbitration was raised.

14

That's something the

And that's the reason, in agreeing to a

15

board for this proceeding, we agreed to a board of

16

the caliber of this board, which is the caliber of a

17

Presidential Emergency Board.

18 19

All Board members have prior PEB experience.

20

In fact, I thought that when I was first

21

thinking about opening argument, I thought I might

22

start this opening argument by a quip saying welcome


11

1

to PEB No. 244.

2

was taken last month by the Long Island Railroad and

3

Mr. Jaffe.

4

But it so happened that that number

The point of that statement is to just

5

stress, this case does have a relationship to

6

Presidential Emergency Board 242, which was the

7

Amtrak last round, and Presidential Emergency Board

8

243, which was the freights in the current round.

9

It's no accident that Chairman Jaffe was a

10

member of PEB 242, chairman of PEB 243, and is

11

chairman of this board.

12 13

We didn't plan on PEB 244, but the reality is there is some overlapping issues there.

14

So if you look at PEB 242, 243, and even

15

244, there are relationships to the issues in this

16

case, so we're going to treat this like a PEB.

17

I should say probably the pay is better

18

for the arbitrators, and the pace of preparations a

19

bit easier for the counsel.

20

we're thinking of it as a PEB.

21 22

But for all purposes,

And as in a PEB, what we're going to ask the Board members to do is to do their jobs, to hear


12

1

the record of our witnesses and our arguments, and

2

the other side's witnesses and their arguments, give

3

careful and due consideration to the entire record,

4

and then provide us with your best work, your best

5

work in fashioning an appropriate collective

6

bargaining solution.

7 8 9

Let me turn to the substantive issues in this case and Amtrak's position. Amtrak would describe the issues in this

10

case as really two, two principal issues:

11

what is the appropriate reference point for

12

fashioning a settlement?

13

appropriate terms of such a settlement?

First,

And, second, what are the

14

Now, Amtrak has and will argue that the

15

Amtrak internal pattern set in 2010 should be the

16

predominant reference point.

17

PRLBC has and will argue that an internal

18

pattern of the freight settlements from 2012 should

19

be the predominant reference point.

20

You will hear about internal patterns,

21

external patterns.

You will hear about "precedent"

22

of various PEBs and interest arbitration decisions.


13

1 2

But the reality is that there is no precedent binding this Board in any legal sense.

3

Patterns are very important, and they will

4

be argued strenuously in this proceeding, but no

5

pattern is written in stone.

6

The Board is being asked to fashion a

7

settlement.

8

immediate problem that's unique to the labor

9

relations situation and the dispute before this

10

Board.

11 12

That's a practical, fact-specific,

My job, our job as advocates, is to help you do your job.

13

We do that, one, by attempting to give you

14

a thorough understanding of the facts that produce

15

this dispute and brought us here today.

16

And, two, by trying to identify

17

alternatives that this Board can consider in doing

18

its job of fashioning a settlement.

19

That's Amtrak's goal in the hearing.

20

That's what our presentation will be directed

21

towards.

22

To that end, I'm going to organize my


14

1

substantive comments around three areas.

2 3

One is pattern; two is timing; and three I call opportunity.

4

Pattern and timing really go to what are

5

the appropriate reference points for settlement.

6

Opportunity really goes to how you fashion the

7

settlement.

8 9

Let me begin with pattern because it's a central issue in this case.

10

In this round, there is an Amtrak internal

11

pattern.

12

matter of opinion.

13

That is an undeniable fact.

It is not a

Now, we will present in detail,

14

principally through Charlie Woodcock, the details of

15

the Amtrak pattern.

16

have 17 voluntary Amtrak agreements since 2010.

17

Thirteen of 15 of our labor organizations are

18

covered under these voluntary agreements.

19

But just to briefly review, we

Sitting here today, 84 percent of the

20

represented Amtrak employees are under these

21

voluntary agreements.

22

agreements include operating employees.

These Amtrak pattern


They

15

1

include nonoperating employees.

2

We had two-thirds of the Amtrak employees

3

under such agreements before PEB 243 was even issued

4

and there were any freight deals.

5

Indeed, we had 57 percent of our employees

6

under the Amtrak pattern agreement by the end of

7

2010.

8

agreements, the sheet metal workers, the IBBB, the

9

NCFO.

10 11

They were all PRLBC coalition units that broke away to join the Amtrak internal pattern.

12 13

This even includes, under the Amtrak pattern

The terms of the Amtrak internal pattern are fairly simple and fairly straightforward.

14

Wages, we have a schedule of general wage

15

increases during the duration of the contract, July

16

1, 2010 to January 1, 2015, amounting to 14 percent.

17

Compounded, obviously more.

18

Moderate changes in health benefits with

19

respect to 15 percent employee contribution with

20

caps.

21

$75.

22

Emergency room co-pay increase from 50 to

The duration, as I have said, is through


16

1 2 3 4

January 1, 2015. The agreements all have me-too clauses, and we'll hear more about that later. There is some variation in work rules, but

5

they all address work rules.

6

rules with respect to discipline and payroll

7

practices that are in the majority of settlements.

8

And then there is variation with respect

9 10

to craft-specific work rules. But all were part of the pattern of

11

patterned negotiations.

12

efficiency of operations.

13 14 15

They're common work

All help effectuate the

So given these facts of this Amtrak internal pattern, what's the PRLBC's position? Well, they take a very surprising position

16

in our view.

17

that an 'internal pattern' exists on Amtrak..."

18

That's in their brief, page 2.

19

They say:

"PRLBC rejects the notion

Now, Amtrak understands that the BMWE and

20

the BRS do not like the fact that other unions

21

seized the initiative and established the internal

22

Amtrak pattern.


17

1

We also very well understand that PRLBC

2

unions don't like the terms of the Amtrak internal

3

pattern.

4

pattern is not a matter of the PRLBC's belief.

5

a matter of objective reality.

6

But the existence of the Amtrak internal It's

And prior Presidential Emergency Boards

7

and interest arbitration decision makers have

8

articulated standards for determining that an

9

internal pattern exists.

10

One, there needs to be critical mass.

11

Typically more than 50 percent of the employees have

12

to be covered.

13

We have 84 percent.

Two, you need to have some operating and

14

nonoperating employees.

15

unions.

16

non-ops.

17 18

We have the operating

We have the mechanical trades.

We have

We have everything except the two engineering unions that are here before you.

19

Third, the pattern has to be

20

contemporaneous in the same period of agreement.

21

All these agreements are covering the same period at

22

issue here.


18

1

We opened agreements January 1, 2010.

And

2

their duration, as I have said, goes through January

3

1, 2015.

4

And, finally, they cover both noneconomic

5

and economic terms.

6

traditionally the core of the pattern, GWIs, we also

7

have healthcare and work rule issues.

8 9 10

While economic issues are

So the Amtrak agreements since 2010 meet all the recognized standards for an internal pattern.

11

There's an old expression, If it looks

12

like a duck, swims like a duck, and quacks like a

13

duck, then it's a duck.

14

The Amtrak internal pattern was formulated

15

as a pattern.

16

was publicized as a pattern.

17

Amtrak employees as a pattern.

18

pattern.

19

It was bargained as a pattern.

It

It was discussed among It was ratified as a

It's a pattern. Given these unavoidable facts, how does

20

the PRLBC argue that the Amtrak internal pattern

21

does not exist?

22

Well, they really present three arguments.


19

1

Their first argument is, "there is no

2

stable 'internal pattern' on Amtrak's property."

3

It's from their brief, page 3.

4

Well, what does that mean?

5

What does it mean "no stable 'internal

6 7

pattern'"? Implicity, I think the PRLBC is saying,

8

which is true, that this Board could destabilize the

9

Amtrak internal pattern by adopting as a Board the

10

PRLBC proposal based upon the freight deal.

11

But that's a totalogy.

12

All internal patterns can be destabilized

13

by a subsequent inconsistent interest arbitration

14

award breaking the pattern.

15

major reason that Presidential Emergency Boards and

16

interest arbitrators have sided for not breaking the

17

pattern because breaking the pattern destabilized

18

the situation.

19

Indeed, that's the

So attaching the label of not stable to

20

the Amtrak internal pattern is really meaningless.

21

But the PRLBC goes on, and they cite the

22

me-too clauses that were agreed to by the settling


20

1

unions as the reason that the pattern is not stable.

2

You'll be hearing more about the me-too

3

clauses.

4

what they mean.

5

in the labor relations knows what me-too clauses are

6

about.

7

We'll explain how they were negotiated and But I think anyone who is involved

When the Union has the courage to settle

8

early, it often seeks me-too protection.

It creates

9

an incentive for the carrier not to break the

10

pattern.

11

union that it's not going to be embarrassed and its

12

members are not going to be relatively disadvantaged

13

if the carrier does break the pattern.

14 15

It provides insurance to the settling

It's a defensive action that protects the settling unions.

16

So what's the PRLBC's argument?

17

Well, they don't view these clauses as a

18

defensive shield for the settling unions that enter

19

them, but they view it as an offensive sword for the

20

BMWE and the BRS to break the pattern.

21

In their world view, these me-too clauses

22

negotiated by other unions, other Amtrak unions, to


21

1

protect themselves are for the PRLBC's benefit and a

2

reason, they articulate, that this Board should

3

consider breaking the pattern.

4

Well, where I grew up in New York, we have

5

a word for this type of argument.

6

from the Yiddish.

7

It's borrowed

It's called chutzpah.

The only analogy I can draw is, because

8

I'm prudent enough to have fire insurance on my

9

house, that gives you a right to come burn it down.

10

That's not what me-too clauses are about.

11

Me-too clauses provide absolutely no justification

12

for breaking a pattern.

13

Well, the me-too clause is evidence that

14

the settling unions and Amtrak were intent the

15

pattern not be broken.

16

PRLBC's twisted view of me-too clauses just has no

17

basis in labor relations.

18

So, just at the outset, the

But there is something PRLBC says about

19

the me-too clauses that we actually agree with.

20

They cite them as relevant as to financial issues,

21

on the financial implications of what's before the

22

Board.


22

1

What the PRLBC argues is, "the difference

2

between the cost of PRLBC's proposal and Amtrak's

3

budgeted expectations is minimal and, even if the

4

other unions exercise their me-too provisions, the

5

change in Amtrak's fiscal condition is

6

insignificant."

7

It's in the PRLBC brief at 8.

8

I think Thomas Roth in his report always

9

describes it as imperceptible.

10

Where we agree with the PRLBC is that this

11

Board must assume, as the PRLBC is assuming, that if

12

a requested award destabilizes the Amtrak pattern

13

agreement, that the financial consequences are

14

me-too pass through through the other unions that

15

have settled.

16

Now, we're going to present evidence on

17

this through D.J. Stadtler, our chief operating

18

officer, who used to be our chief financial officer.

19

That issue of the me-too pass-throughs

20

through the other unions amplifies the issues in

21

these cases.

22

$100 million issue during the term of this agreement

And the bottom line is this is over a


23

1

with carry forward implications into future years.

2

In Amtrak's view, that's not minimal,

3

that's not insignificant, that's not imperceptible.

4

That's financial and material.

5

considered as one of many reasons why this Board

6

should not even entertain breaking the pattern.

7

And it should be

PRLBC has an additional argument for

8

breaking the pattern.

They look at the UTU

9

Conductor Agreement, and they basically argued that

10

that agreement already broke the pattern by

11

providing a conductor performance bonus, and that

12

that means the economic terms are not uniform.

13

And in Mr. Roth's report, he monetizes the

14

UTU conductor bonus as the equivalent of a 2 percent

15

increase.

16

PRLBC argues that, Well, given that

17

monetization, and the me-too clauses, the Amtrak

18

pattern is already gone.

19

Well, we'll present the facts about the

20

UTU conductor bonus.

21

will be Charlie Woodcock's testimony.

22

But let me just -- and that

Let me just note a few things.


24

1

The UTU actually negotiated three

2

agreements on Amtrak, conductors, yardmasters, and

3

stewards.

4

Now, you would assume when they negotiated

5

that, if they knew that this should be monetized,

6

they would have monetized it with the other two

7

unions, the yardmasters and stewards.

8

do so.

9

They didn't

The fact that UTU is now with the sheet

10

metal workers and SMART, they have a me-too clause

11

as well.

12

the UTU bonus as a GWI for the sheet metal workers.

13

The sheet metal workers didn't monetize

In fact, no union has filed a grievance

14

under a me-too clause since the April 2013 UTU

15

Conductor Agreement.

16

We sitting here in January 2014.

17

Presumably, this issue would be litigated if it were

18

going to be.

19

It hasn't.

But we think a lot of this is premised on

20

the PRLBC either misunderstanding or

21

mischaracterizing the UTU conductor bonus.

22

It's not an award for showing up for work.


25

1

It requires certification, attendance, and working

2

at a higher level position.

3

There were carefully negotiated tradeoffs,

4

which Charlie Woodcock will talk about, that reflect

5

the fact we were cognizant of the me-toos.

6

negotiated a conductor bonus provision that provides

7

economic savings and staffing to Amtrak.

And we

8

It is unlike the rules that you will see

9

on the freights or on the commuters, so there's no

10

basis in viewing this as monetizing.

11

work-rule-connected bonus.

12

It is a

Now, as you know, PEB No. 244 had very

13

similar monetizing argument just last month where

14

other unions were arguing that the UTU certification

15

pay on the Long Island Railroad should be monetized.

16

The GWI and PEB 244 rejected that.

17

There are even more reasons here to reject

18

that because of the different nature of the Amtrak

19

performance bonus than what you see on the computers

20

or the freights.

21 22

So the bottom line is that the PRLBC's argument that the UTU Conductor Agreement broke the


26

1

pattern is just factually wrong.

2

The PRLBC goes on and makes an additional

3

argument about the pattern, and it's about the

4

historic relationship between Amtrak and the

5

freights.

6

It says:

"The notion that Amtrak's

7

claimed 'internal pattern' should trump the

8

historical linkage between the freight and Amtrak

9

agreements should be rejected."

10

Their brief at 12.

11

What they're really saying is that, as a

12

matter of precedent and right, Amtrak can't

13

establish an internal pattern.

14

They're not just arguing that the freight

15

deals should be given more weight, but that the

16

Amtrak internal pattern can't exist.

17

The tone of the argument is almost how

18

dare Amtrak and its other unions go ahead and

19

bargain first and set an internal pattern.

20

just not permitted.

21 22

That's

Well, there's no recognition that historically the relationship between the Amtrak and


27

1

the freights was based upon the freights bargaining

2

first in each round.

3

And in this round, Amtrak bargained first.

4

We did that cooperatively with our other unions, and

5

we did it almost by two years before the freights.

6

Again, we understand that BMWE and BRS

7

aren't happy that Amtrak bargained first, aren't

8

happy with the deals the other unions made.

9

But Amtrak did it.

Could do it.

10

do it.

11

of the majority of the labor organizations

12

representing the Amtrak employees.

13

They did

And it did it because it had the cooperation

So that's the reality of the Amtrak

14

internal pattern that must be considered by this

15

Board in undertaking its deliberations.

16

That begs a question, why is the PRLBC so

17

intent on denying the existence of the Amtrak

18

internal pattern?

19

Well, we think that reason is clear.

20

Because the implications for finding a strong Amtrak

21

internal pattern are clear.

22

Presidential Emergency Boards and the


28

1

interest arbitrators who have addressed this issue

2

uniformly have held that a strong internal pattern

3

does trump an external pattern.

4

The internal pattern, in my language,

5

becomes the predominant reference point for

6

fashioning a settlement.

7 8 9

We think the PRLBC knows that.

We think

they have known that since 2010. And what they're doing is attempting to

10

deny the facts of Amtrak's internal pattern in order

11

to preserve an argument that the freight deals

12

should be given predominant weight.

13

But the record at the end of this hearing

14

will plainly establish what the facts are.

15

an internal Amtrak pattern.

16

labor relation principle, the Amtrak internal

17

pattern should be given controlling weight as the

18

reference point for fashioning a settlement.

19

There is

And as a matter of

And now, we'll turn to the issue of timing

20

because timing is very important in this case, and

21

it's important in three different ways.

22

First, the PRLBC pursued a delaying


29

1

strategy, which we'll talk about more in a moment,

2

that should be given equitable consideration.

3

Second, the delay between the period of

4

the Amtrak agreements and the period of the freight

5

settlements itself needs to result in limited weight

6

for the freight settlements.

7

And the third, through the delay the PRLBC

8

has pursued, they have actually limited the Board's

9

options in this proceeding.

10

Let me explain that more.

11

Charlie Woodcock will talk a lot about the

12

chronology of this bargaining round.

13

graphics, a timeline that will take you through it.

14

We will have

But the reality is we're sitting here on

15

January 6, 2014.

16

This round began January 1, 2010, over four years

17

ago.

18 19

We're at the end of the round.

The Amtrak pattern agreements expire in January 1, 2015.

That's less than a year.

20

A lot of time has passed.

21

Well, what the facts will conclusively

22

show is that the PRLBC is responsible for this


30

1

delay.

2

Not Amtrak.

3

Amtrak learned its lesson in PEB 242.

4

were criticized very expressly for the eight-year

5

delay.

We

6

And you're going to hear from both

7

Mr. Woodcock and Mr. Boardman on this issue.

8

pursued a deliberate strategy in this round to seek

9

early reasonable deals.

10

Amtrak

We sought and obtained those first deals

11

in 2010.

12

employees having voluntary collective bargaining

13

agreements in the first year.

14

We succeeded with over 50 percent of our

That's an extraordinary accomplishment

15

under the Railway Labor Act.

16

occasion where it has happened elsewhere, that

17

portion of the work force in that short of a time.

18

And it happened because Amtrak offered good deals in

19

what was then, as now, a difficult economic

20

environment.

21 22

I can't think of an

Another fact is the BMWE and the BRS were slower in bargaining.


31

1

In early 2010, they were putting together

2

their joint coalition Section 6 notices when other

3

unions, the TCU, the IAM, the IBEW, and the JCC were

4

making deals with Amtrak.

5 6

We got our first tentative deals in April 2010 on a January 1, 2010 reopening.

7

PRLBC's response to those developments has

8

been to reject the internal pattern and pursue a

9

strategy delay.

10

And there's just no secret -- and you'll

11

see it in the record -- that the BMWE and the BRS

12

decided they weren't going to make a deal until the

13

freight deals arrived.

14

We'll provide detail on this, but from

15

December 2010 to February 2012, there were no

16

discussions.

17

deals.

18

PRLBC was waiting for the freight

You'll see a chronology we'll present on

19

this, and there will be big white spaces in the

20

middle, big white spaces where nothing was happening

21

in 2011 because the PRLBC was waiting.

22

And they don't deny this.


32

1

If you look at their brief, they say that

2

the parties made no progress in 2010 because they

3

were, "hampered by the fact that agreements between

4

the Freights and the Organizations had not yet been

5

settled."

6

That's in their brief at 6. Well, Amtrak wasn't hampered in reaching

7

agreements with its other unions, the Amtrak pattern

8

agreements.

9

bargain until the freight deals were completed.

10 11

It's the PRLBC.

They were unwilling to

And now, they have spent basically four years opposing an Amtrak internal pattern.

12

And they say in their brief:

"Why should

13

the Organizations before this Board...be penalized

14

for standing on principle..."

15

brief.

16

Page 13 of their

The principle they're talking about is the

17

linkage between Amtrak and the freights.

18

they mean by standing on principle is not

19

bargaining.

20

And what

There were no freight deals in 2011 in

21

which to compare, in 2010, or 2011 in which to

22

compare.


33

1

So what standing on principle has meant is

2

that there have been no wage increases for the BMWE

3

employees for four years because their unions were

4

unwilling to make a deal.

5

The real question the Board has to ask

6

itself is not about the BMWE and the BRS being

7

penalized.

8

rewarded for pursuing a strategy of delay and

9

intransigence?

10

Why should the BMWE and the BRS be

Amtrak was chastised for delay in PEB 242.

11

We were held responsible of an eight-year delay.

12

The PEB opined about employees not getting increases

13

during that period and how bad a thing it was.

14

Well, if delay was a bad thing in 242, how

15

can it possibly be a good thing when looking at this

16

round and this proceeding?

17

Delay should be a negative factor in

18

assessing this dispute, and the responsibility for

19

the delay lies with the PRLBC.

20

So in your deliberations, we're going to

21

be asking the Board to give due weight to that

22

delay.


34

1

And that delay is significant because we

2

wouldn't even be talking about freight deals as a

3

reference point if that hadn't occurred as a result

4

of the delay or the result of not reaching

5

agreement, which gets me to the point about giving

6

limited weight to the freight deals.

7

We have this gap, this period of time from

8

the first Amtrak internal pattern deals in April

9

2010 to the first -- the BMWE freight deal and the

10

BRS freight deals in early 2012.

11

Our position is yes, the Amtrak internal

12

deals trump those freight deals and external pattern

13

because they weren't around.

14

You're not comparing concurrent internal

15

and external agreements.

16

just ignores this.

17

case is just, Let's look at these two reference

18

points and what's the most appropriate.

19

PRLBC's argument really

They want you to think that this

Well, you have to ask yourself, How did we

20

get here?

21

pursued a strategy of delay.

22

And the answer is because the Union

What's the implications of that?


35

1

Retroactivity is a big issue in PEB 242.

2

Again, Amtrak was criticized by not putting

3

retroactivity on the table.

4 5 6

This round, we said, Okay; up front, these deals are going to be retroactive. Well, in doing so, Amtrak bore some risk,

7

more risk of what the ultimate outcome would be in

8

having to applying it retroactively.

9

That risk becomes amplified if you say a

10

later, richer external pattern has to be applied

11

retroactively, the risk of retroactivity has been

12

unfairly amplified for Amtrak.

13

And, again, that rewards the unions for a

14

strategy of delay.

15

comparison but for the strategy of delay.

16

And you wouldn't even have this

So there are really two reasons why you

17

should minimize the freight deals.

18

come almost two years later.

19

reason we got there is because the Union was not

20

bargaining.

21 22

One, they just

And two, the only

I mentioned the timing constraints on this Board for fashioning an alternative settlement.


36

1

Back in 2010, again, three and a half

2

years ago now, Amtrak suggested to the PRLBC, Well,

3

if you don't like the internal pattern agreements,

4

let's talk about healthcare, work rule, offsets that

5

can generate additional GWIs.

6 7

And that's something we'll talk about more in this proceeding.

8 9 10

The PRLBC's delay has constrained that approach. Again, we have less than a year left.

11

That means you have less of a period to develop and

12

implement cost saving offsets.

13

The GWIs can be applied retroactively.

14

The only other factor that can be applied

15

retroactively are healthcare costs premium

16

contribution.

17

offsets to the back pay, the retro pay.

18

other plan change can't be applied retroactively.

19 20 21 22

You can apply those retroactively as But any

Any work rule changes can't be applied retroactively. So by playing out the clock, the PRLBC really has limited the alteratives before this Board


37

1

for developing offsets that could generate more

2

GWIs.

3

And that is another reason why, at the end

4

of the day, the Amtrak position that the Amtrak

5

internal pattern is the appropriate award should be

6

given greater weight.

7

So overall, when you look at the facts

8

relating to pattern, the strength of the Amtrak

9

internal pattern, and these timing issues, you come

10

back that the Amtrak internal pattern is the

11

appropriate award in this case.

12

But I want to talk about opportunity.

13

As I said in the beginning, this Board's

14

job is to fashion settlement.

15

everything I have said about the Amtrak internal

16

pattern is the appropriate award, there is an

17

opportunity here for the Board to fashion some form

18

of an alternative.

19

And notwithstanding

We, for example, put on the table our July

20

17, 2013 proposal.

It basically adopted the

21

healthcare plan changes under the freight deal,

22

Amtrak's pattern contribution for 1 percent more of


38

1

GWIs in 2014.

2 3

That was an effort to generate more income through work rule changes.

4

Actually, the UTU Conductor Agreement is

5

another example of generating more money through

6

associated work rule changes for which we get

7

criticized.

8

with the PRLBC.

9

It's the same approach we suggested

Now, there is this timing problem that we

10

have less than a year to work with under this

11

duration for this agreement.

12 13

But there still is the possibility of making some tradeoffs there to fashion an agreement.

14

What's the PRLBC's position on this?

15

"The PRLBC has no interest in making and

16

refuses to make this choice."

17

at 4.

18

In fact, they go further.

19

Amtrak of pursuing:

20

Section 1113 approach."

21 22

It's in their brief

They accuse

"A Bankruptcy Code 11 USC

Well, that's inaccurate, unfair, and just plain counterproductive rhetoric.


39

1

We are not in a Section 1113 bankruptcy.

2

Amtrak is not attempting to reduce its overall labor

3

costs.

4

increase our labor costs.

5

other unions to increase our labor costs, and 84

6

percent of our employees agreed to that.

7 8 9

Amtrak has put money on the table to We made deals with our

So to say that this is an 1113 process, or an analogy, just doesn't belong in this discussion. What we believe is that when you go to the

10

bargaining table and you discuss both parties'

11

interests and needs and you make tradeoffs, that's

12

called good faith collective bargaining, not a

13

Section 1113.

14

PRLBC makes reference to good faith

15

collective bargaining in its brief in referring to

16

the freight deals.

17 18 19

What about good faith arm's length collective bargaining with Amtrak? Amtrak has done that successfully with 13

20

of our 15 unions.

21

responded positively.

22

Thirteen of our 15 unions We have the deals to show it.

But in four years, the BMWE and the BRS


40

1

have made no proposal other than take the freight

2

deal with the BMWE, put it on the table and say,

3

That's the deal.

4

Well, not really because we want lower healthcare

5

contribution rates.

6

And then turn around and say,

When Amtrak said, Let's come up with some

7

ways to fund additional GWIs alternatives, we didn't

8

get any counterproposal with PRLBC.

9

These organizations, unfortunately, have

10

shown no interest in actually bargaining with Amtrak

11

because it requires tradeoff.

12

Now, this Board because we're in interest

13

arbitration does have the authority to develop and

14

make tradeoffs as part of its award if it's

15

convinced that's the best approach for the parties.

16

If not, you don't do it.

17

What are the possible tradeoffs?

18

We talked about healthcare.

We're in a

19

national environment of controlling healthcare

20

costs, as has been reflected in the table.

21

243 and 244 dealt with healthcare changes.

22

Both PEB

PEB 244 actually cites 243, cites other


41

1

settlements, including Amtrak's, and says there's

2

really this trend of greater employee cost sharing

3

to address healthcare costs.

4 5

Clearly Amtrak has an interest in controlling its healthcare costs.

6 7

We're willing to share those savings through increased GWIs.

8 9

We'll be presenting testimony of Thomas Rand, our healthcare expert.

And we'll explore what

10

opportunities they were offered modifications in the

11

AmPlan that could generate cost savings and generate

12

funds for additional GWIs.

13

The point in presenting this testimony is

14

not saying that this Board must address healthcare.

15

We're not saying that at all.

16

We're saying that we're providing

17

information, and the Board can decide whether to use

18

it or not.

19

Let me address work rules.

20

The PRLBC has expressed very adamant

21

refusal to consider work rule changes, including use

22

of work rules to fund additional GWIs.


42

1

They object even to the Amtrak pattern

2

payroll deduction and minor discipline process

3

changes.

4

other Amtrak unions.

Those have been non-controversial with our

5

The PRLBC accuses us of racism.

6

It's the same thing in bargaining and

7

mediation.

8

BMWE and BRS to discuss work rules.

9 10 11

It has just been a plain refusal by the

Same thing last round, no bargaining over work rules with this group for over 14 years. Now, we don't know why the BMWE and BRS

12

take that approach.

13

it's internal union politics.

14

practical as a collective bargaining approach

15

because what they're doing is they're refusing in

16

collective bargaining to hear Amtrak's interests.

17

That really denies the existence of the

18

other parties' interests in bargaining, and those

19

interests are not going away.

20

you're not going to talk about it just doesn't make

21

the problem go away.

22

Perhaps it's ideology.

Perhaps

But it's simply not

And just saying

Why is Amtrak interested in modifying its


43

1

work rules?

2

You'll hear from Bruce Pohlot, our chief

3

engineer.

4

for the BMWE and BRS on the Northeast Corridor.

5

Our current environment is a lot of work

Both crafts have grown substantially since

6

2007 and PEB No. 242.

7

particularly interested in officially utilizing our

8

manpower resources.

9

And that makes us

We have a lot of skilled people who have

10

been trained, highly trained and are not performing

11

the functions for which they were trained.

12

an interest in changing that.

We have

13

We have an interest in reducing make-work

14

that's not the most productive work these employees

15

can do.

16

We have an interest in contracting out

17

certain functions where it can be done more

18

efficiently.

19

But a lot of the underlying concern with

20

Amtrak is really increasing the return on the

21

training investment and reducing overtime.

22

The overtime issue is not a small issue.


44

1

Amtrak has to report to Congress every Amtrak

2

employee who obtains more than $35,000 in overtime a

3

year.

And D.J. Stadtler will talk about that.

4

And you'll see the BMWE and the BRS are a

5

big portion of those folks, and they're pretty high

6

on the list.

7 8

That's a problem for Amtrak.

What the organizations need to recognize is it's a problem for them as well.

9

Amtrak is a publicly owned and funded

10

organization.

11

to the taxpayers that we're operating efficiently.

12

We do have an obligation to justify

Calling the federal government, "the

13

deepest pocket on earth," as the PRLBC does in its

14

brief at 13, might be self-assuring rhetoric for

15

these two organizations.

16

represent the political reality of funding for

17

Amtrak.

18

But it just does not

So the opportunity here is to address a

19

problem, which is Amtrak's problem, and we think

20

it's the Organization's problem.

21

tradeoffs that the organizations are going to get

22

value in increased GWIs, and that that could be a

That produces


45

1

productive way to go forward to address these issues

2

in ways that make good use of a difficult situation.

3

Amtrak recognizes the hesitancy of this

4

board, any PEB, any interest arbitrator, to get

5

involved in work rules.

6

No one likes to do it.

And we also recognize you're hearing an

7

admin position from the PRLBC.

8

why we have attempted to make our work rule

9

proposals as simple as possible.

10

That's the reason

On the craft-specific pattern work rules,

11

we have changing numbers, changing a 45-mile rule to

12

a 60-mile rule; changing a six-month block into a

13

12-month block, and that doesn't require a lot of

14

working with the details of work rule.

15 16

And with the other work rules trading for GWIs, we have tried to do the same thing.

17

This is an interest arbitration.

It's not

18

a PEB.

You have a little bit more time and

19

attention to address these issues.

20

line is there is an opportunity for tradeoff with

21

some reasonable modification in work rules that will

22

lead to greater GWIs.


But the bottom

46

1

Amtrak's not saying you need to do that.

2

We're saying that is an approach that's

3

available to the Board if it concludes that that's

4

the best way to go.

5

Let me bring this to a conclusion.

6

Amtrak submits that the evidence at

7

hearing will prove a very strong Amtrak case for

8

imposition of the Amtrak internal pattern as the

9

terms for settlement with the BMWE and BRS.

10

We have compelling factual reasons

11

relating to the uniformity, the nature, the

12

pervasiveness of the Amtrak pattern.

13

equitable reasons concerning PRLBC's delay while

14

waiting for the freights.

15

relations reasons and principles of supporting

16

internal patterns.

We have the

And we have the labor

17

All of those, when the entire case is in,

18

will support finding the Amtrak internal pattern is

19

the way to go for settlement.

20

So the Board can issue an Amtrak internal

21

pattern award.

You'll have more than sufficient

22

basis in the record.

And that would then leave the


47

1

parties to resolve their longer term differences

2

concerning wages, healthcare, and work rules in the

3

next round, which begins in a matter of months not

4

years.

5

I mean, we're talking about if it's an

6

agreement that end on 1/1/2015, we're in bargaining

7

almost immediately.

8 9

But Amtrak recognizes, and we hope the BMWE and the BRS recognizes, that this type of

10

zero-sum result may not be in the best interests of

11

the parties.

12

That's the reason Amtrak is prepared and

13

interested in working with the Board and the

14

organizations to develop alternative solutions,

15

alternative solutions that will provide higher GWIs

16

on the Amtrak pattern with reasonable tradeoffs in

17

the areas of healthcare and work rules, and any

18

other creative solution the Organization or the

19

Board might come up with.

20

This is not an easy task.

21

Fortunately, we think we have a board with

22

both the experience and expertise to attempt to


48

1

achieve that delicate task, and we're committed on

2

Amtrak's part to provide the Board with the

3

information it needs so that you can do your job and

4

fashion an appropriate and constructive settlement.

5 6 7

With that, I thank the Board members for their time and attention.

I thank the PRLBC.

And we look forward to working with both

8

the Board and the Organization to get this record

9

complete and move on to a resolution.

10

Thank you.

11

ARBITRATOR JAFFE:

12

Would you like a few moments or do you

13 14 15

Thank you, Mr. Reinert.

wish to begin? MR. WILDER:

I would like to secure a

glass of water.

16

ARBITRATOR JAFFE:

17

We're off the record.

18

(A recess was taken.)

19

ARBITRATOR JAFFE:

20

MR. WILDER:

21

Members of the Board.

22

That's fine.

Back on the record.

Thank you, Mr. Chairman,

This is an interest arbitration convened


49

1

under Sections 7 and 8 of the Railway Labor Act by

2

agreement of the parties, which, as the chairman

3

noted, was concluded on September 6 of 2013.

4

This proceeding is designed to settle

5

disputes that were initiated by Section 6 notices

6

served by the engineering crafts on December 1,

7

2009, January 1, 2010, and by their representative,

8

the Passenger Rail Labor Bargaining Coalition on

9

February 25 -- I'm sorry, April 7, of 2010.

10

As such, this proceeding is in lieu of a

11

PEB.

Like a PEB case, of course, the parties have

12

already said too much about too many things,

13

whereas, they have said the same thing in too many

14

different ways.

15

The fact is that this case is much easier

16

than the blizzard of words in the parties' filings

17

would suggest.

18 19

Let me describe several facts which are not, I think, open to dispute.

20

At Amtrak, the current economic picture is

21

bright.

Ridership is at record levels again in

22

2013, marking the 11th record since 2000.


50

1

This increased ridership, of course, has

2

driven revenue.

3

check largely by compressing labor costs increases.

4

Overall, expenses have been held in

As a result, Amtrak's recovery rate, which

5

is measured by its commercial revenue as a percent

6

of total operating expense, stands at 87.6 percent,

7

better than any other passenger railroad.

8 9

Think for a moment.

Amtrak represents a

public effort to assure continued rail service to

10

the passenger wanting to travel other than by car or

11

by air.

12

It has a definite public mission. Yet, Amtrak alone of the passenger

13

carriers finds most of its operating expense, the

14

vast majority, at the turnstile.

15

This is unique.

16

It also is a factor of employee

17

productivity.

18

productivity has risen steeply.

19

Over the past decade, employee

Combined with moderate labor cost

20

increases, this increased productivity has caused

21

Amtrak's unit labor costs to remain virtually flat

22

over the past decade.

And when you adjust for


51

1

inflation, Amtrak's unit labor costs show almost a

2

20 percent reduction.

3

Now, these figures are not conjured out of

4

thin air.

5

they will be testified to by our labor economist,

6

Thomas R. Roth, when he testifies next week.

7

They are part of the public record, and

These favorable economic results mirror

8

those on the freight railroads and tend to

9

explain -- and this is important -- tend to explain

10

why there has been little or no dispute over work

11

rules over the past decade in the railroad industry.

12

That is, for the past several rounds on

13

the freights and at Amtrak, there has been very

14

little controversy over work rule change.

15

The reason for that is that the sharply

16

rising productivity has meant that these disputes,

17

previously common in the rail industry, have taken a

18

distinctly second tier to the economic disputes

19

involving wages and benefits.

20 21 22

That is where the modern rail dispute is, and that is where this dispute is. Now, the second fact is that the


52

1

differences in the parties' economic positions are

2

quite narrow.

3

Mr. Roth calculates that difference in

4

cumulative costs over a five-year period ending on

5

January 1, 2015, at $8.7 million.

6

Putting that in percentage terms, the

7

annual rate of increase under the PRLBC's position

8

is 1.2 percent per year.

9

the annual rate of increase is 1.07 percent per

10

year.

Under Amtrak's position,

That's a difference of .13 percent.

11

Now, what is this dispute all about?

12

The economic differences are narrow.

The

13

parties have made credible proposals to one another.

14

The Amtrak has put forward what it describes as an

15

internal pattern.

16

forward the national freight pattern.

17

The organizations have put

And the differences between applying one

18

pattern or the another is really quite narrow, as we

19

pointed out.

20

Now, the -- Mr. Reinert, in his opening,

21

described as indisputable the fact that an internal

22

pattern exists on Amtrak.


53

1

We acknowledge that the pattern that was

2

developed in 2010, the so-called internal pattern,

3

does have that critical mass that is referred to by

4

PEBs and interest arbitrators.

5

But remember, that so-called internal

6

pattern is the first internal pattern that even

7

Amtrak has ever put forward in collective bargaining

8

since its inception in the mid 1970s.

9

This is a first-time event.

10

We submit that it is the obligation, not

11

just of the Board, but of the parties, to assure

12

that this so-called internal pattern evidences the

13

kind of stability that will make it a credible

14

pattern for this round and future rounds at Amtrak.

15

The problem with this so-called internal

16

pattern, and one that is utterly disregarded by

17

Amtrak, is that wage patterns must be based upon job

18

comparability if, in fact, they are to have that

19

kind of stability that causes them to endure in

20

collective bargaining.

21 22

In the rail industry, comparable jobs are found only on the passenger carriers operated by the


54

1

states' so-called commuter rail carriers, or on the

2

freight carriers.

3

Amtrak early on rejected out of hand the

4

notion that the computer rail carriers could furnish

5

appropriate comparators.

6

rejected again, despite 30 years of bargaining

7

experience, the notion that the freight carriers

8

would furnish an appropriate comparator to judge the

9

reasonableness of its wage and benefit proposal.

10

And then later, it

Instead, Amtrak -- and I thought that I

11

would try to avoid casting blame, much like my

12

colleague did in his opening statement, but Amtrak

13

tried for a fait accompli.

14 15

There's really no other good words for what Amtrak has done in this round.

16

It has tried as part of this fait accompli

17

to establish an internal pattern that is based on a

18

new untested standard of comparability that will

19

place Amtrak employees at the bottom of the rail

20

industry.

21 22

What we are facing, if this internal pattern is developed, if this indeed was a fait


55

1

accompli, is a structured rail industry with the

2

passenger carriers on the top.

3

Island Railroad, Metro North, and the other

4

passenger carries in the Northeast Corridor.

5

And I speak of Long

In the middle will be the freight

6

carriers, which, since 1975, have furnished the

7

appropriate comparator for Amtrak employees.

8

the bottom of rail industry, there will be Amtrak

9

employees.

10 11

That's what we're looking at.

And at

That's the

reality of this case.

12

And I urge the Board to keep that simple

13

and indisputable fact in mind when we hear more

14

about Amtrak's alleged internal pattern.

15 16

The fact is that this so-called internal pattern is based on nothing.

17

Wage studies like the one conducted by

18

Dr. Gillula have been repeatedly rejected by PEBs

19

because it's recognized that railroad jobs are

20

unique.

21

are in the commuter rail industry and the freight

22

industry and on Amtrak.

And the only place we find railroad jobs


56

1

So what is this internal pattern based on?

2

Like any untested internal pattern, we're

3

dealing with so-called internal comparability.

4

Carrier is asking the Board to determine that the

5

jobs of clerks and of shopcraft employees furnish an

6

appropriate comparator for determining what the

7

wages of engineering crafts will be.

8 9 10 11

The

You just have to accept that because this pattern emerged out of Amtrak's mind and the intentions of its new management in early 2010. The instability of this pattern was

12

demonstrated, we believe, the first time that it

13

came to be put forward to the operating crafts.

14

Now, there has been much criticism of the

15

shopcrafts for waiting -- excuse me, much criticism

16

of the engineering crafts for waiting until the

17

freight agreement was completed.

18

That unreasonableness, that almost bad

19

faith, in the words of my colleague, Mr. Reinert,

20

followed 35 years of experience.

21 22

Yes, in every other round on Amtrak, the parties have waited until the freight agreement was


57

1

completed before engaging in the kinds of bargaining

2

that has led to an agreement.

3

We are told again, by way of opening

4

statement, that our choice to wait for the freight

5

agreement consistent with 35 years of bargaining

6

history is equatable to what Amtrak did last time,

7

which was to wait for two rounds to pass and then

8

take the position before Board 243 that there would

9

be retroactivity.

10

Now, I will leave it to you to determine

11

whether or not those events are equatable or not.

12

Certainly, we say not.

13

What happened with the UTU?

UTU did not

14

settle until April of 2013, or just about one year

15

after the freight agreement was completed.

16

And the question on that bargaining was

17

how would Amtrak's internal pattern fare?

18

to the task?

Was it stable?

Was it up

Would it work?

19

And the answer was it a resounding no.

20

The UTU deal, as the evidence will show,

21

vividly demonstrated that the April 13 UTU

22

settlement, which contained provisions for


58

1

additional annual compensation of $1,250 per

2

conductor, was not up to the task, that the internal

3

pattern at that point showed that it was unstable.

4

You heard during Mr. Roth's opening

5

statement -- Mr. Reinert's opening statement that

6

our witness, Thomas Roth, has calculated the UTU

7

additional compensation to be worth approximately a

8

2 percent general wage increase.

9

Now, we will wait for Mr. Roth's testimony

10

to explain in detail.

11

no place in opening statement.

12

That kind of explanation has

It suffices to know that that 2 percent

13

more than bridges the gap between the parties' wage

14

proposals in this case.

15

were additional compensation made available by

16

Amtrak in the four years of bargaining, we would not

17

be here.

18

In other words, if there

If we were treated as UTU was treated in

19

terms of a very loose and unstable internal pattern,

20

there would have been a settlement, just like UTU.

21

Now, Amtrak took a much different course

22

with respect to the engineering crafts than it did


59

1 2

with the operating crafts. I understand from the opening statement

3

that we will hear how the additional $1,250 in

4

additional compensation for a conductor actually

5

helped Amtrak and reduced its costs.

6

What of the operating crafts?

7

Well, you heard that in the Company's

8

opening statement.

9

engineering crafts in terms of training rules and in

10 11 12 13

They needed something from the

terms of the so-called 45-mile rule. Now, did they provide financial incentive as they did for the conductors?

No.

What they want from us is a work rule

14

change that will enable Amtrak to compel signalmen

15

to journey within a radius of 60 miles from their

16

headquarters instead of 45.

17

They want from the maintenance-of-way

18

employees a training lock-in of a year that will

19

have the same effect which will enable the Company

20

to force assign employees throughout the system.

21 22

Nothing about additional compensation in order to achieve these goals that, of course, we


60

1

were not the UTU.

2

It is worth noting that the two rule

3

changes I have mentioned have been cited by Amtrak

4

as the price for agreeing with the engineering

5

crafts on an internal pattern.

6

We are not talking about additional

7

compensation to obtain those work rule changes.

8

Those work rule changes are the price for the

9

engineering -- the engineering crafts obtaining the

10

internal pattern.

11

Now, what is the difference between those

12

changes and the kinds of changes that were asked of

13

other organizations?

14

Well, there are two big differences.

15

One is, those changes are punitive.

The

16

second is, they were not asked for by the

17

engineering crafts as were many of the changes cited

18

by Amtrak as an effort to support its internal

19

pattern.

20 21 22

Why were the engineering crafts treated differently? Now, you can't have an internal pattern, a


61

1

credible, stable internal pattern, and treat

2

different -- treat different organizations

3

differently in terms of wages.

4

I mean, wages is the one thing that should

5

be uniform at least in terms of the wage increase if

6

you have a credible pattern.

7

happened here.

8 9 10

So that's a major difference, and it's one that has been causing the parties to remain apart from the outset in early 2010.

11 12

That's not what

This is not something new.

It's not part

of the smorgasbord.

13

Let me deal with that issue very briefly.

14

From 2010 until July of this year, excuse

15

me, July of 2013, Amtrak has taken the position that

16

if you want more wages, then you have to pay for

17

them by work rule changes.

18

It has offered a so-called smorgasbord of

19

work rule changes that are assigned arbitrary

20

values.

21 22

Amtrak did not make a proposal from 2010 until July of 2013 that we will add additional


62

1

wages, 1 percent, 2 percent, what have you, in

2

return for X, Y, and Z work rule changes.

3

never done.

4

That was

We were offered a smorgasbord, and we

5

could pick whatever we wanted so long as it amounted

6

to closing the gap, whatever the gap was, because

7

that -- Amtrak would not tell us at that point.

8

Now, what happened in July of 2013?

9

Amtrak made a definite proposal that the

10

Company would agree, effective January 1, 2014, to

11

add an additional 1 percent to the engineering craft

12

wage package in return for changes in the AmPlan,

13

not the changes in the AmPlan which they

14

euphemistically describe kind of like or on the

15

order of the changes that were made in the National

16

Freight Agreement.

17

What those changes were in reality, far

18

deeper and more drastic than the changes that were

19

decided by Board 243.

20

Now, having mentioned that, let me remind

21

the chairman, who was also the chairman of 243, that

22

the healthcare issue was exhaustively examined


63

1

during that PEB with the help of recognized experts

2

in the healthcare field representing both the

3

organizations and the carriers.

4

Public law -- Presidential Board 243

5

struck what it believed was an appropriate balance

6

between the containment of healthcare cost inflation

7

and the healthcare needs of the sick, disabled, and

8

elderly.

9

The organizations vigorously opposed the

10

kinds of planned design changes that were ultimately

11

decided upon by Presidential Board 243.

12

We agreed to accept them at Amtrak only

13

because they became part of a national pattern under

14

which the vast majority of maintenance of way

15

employees and signalmen work in the country.

16 17 18

They became part of the deal of railroad employment. But we cannot accept more onerous plan

19

design changes that Amtrak insists upon for an

20

additional 1 percent in compensation.

21

There is no part of that bargaining that

22

is fair to our members and to their beneficiaries.


64

1

Equally, we have not been interested in

2

giving away work rule protection, fundamental job

3

protections that have been gained over decades of

4

bargaining in order to achieve the relatively small

5

amount of additional wages that is at issue in this

6

proceeding.

7

One final word.

8

If we're talking about an internal

9

pattern, and it is a pattern that differs in terms

10

of wages, benefits, and rules, it is not much of a

11

pattern.

12

It does not have that degree of stability

13

that bodes well for stable labor relations on Amtrak

14

in the future.

15

And I think that in conclusion, I would

16

like to find one thing that Mr. Reinert said that I

17

can agree with to show the cooperative spirit.

18

And that is, I quite agree that we have

19

with us the arbitration Board that can make the

20

kinds of decisions that are made.

21

Thank you.

22

ARBITRATOR JAFFE:

Thank you, Mr. Wilder.


65

1 2 3

Off the record. (A lunch recess was taken.) MR. REINERT:

Before I start with

4

Mr. Woodcock, before I actually call him, I want to

5

explain a little bit about the process in this case

6

and how we're going to try to expedite things even

7

though this is going to be lengthy testimony.

8 9 10 11

One of the things the parties did very successfully in terms of prehearing procedural issues is deal with exhibits. And Joint Exhibits 12 to 54 are basically

12

all the bargaining exchanges, table exchanges.

13

Amtrak's Exhibits 202 to 255 are basically documents

14

that relate to the Amtrak pattern agreement.

15

And

Rather than go through the rigmarole of

16

offering individual exhibits -- I know they have

17

been admitted -- Mr. Woodcock and other witnesses

18

are going to talk with the assistance of PowerPoint

19

presentations.

20

We haven't put all the exhibit numbers on

21

the PowerPoint presentation.

As we go through, my

22

intent, I will just refer to the slides that


66

1

underlie the material.

But the witness is not going

2

to be talking about specific exhibits other than in

3

a handful of circumstances.

4

So the reality is we have hundreds of

5

documents related to this bargaining round, and

6

there's going to be specific reference in calling up

7

maybe five of them in the process.

8

It's just an easier way to do business.

9

And I don't think -- I think it will move

10

along a little bit more smoothly.

11

MR. WILDER:

Just so I understand, what

12

we're going -- and I'm holding testimony of Charles

13

Woodcock.

14

MR. REINERT:

15

MR. WILDER:

16

MR. REINERT:

17

MR. WILDER:

18

January 2014. Correct. And if I understand what

you're saying, we are going to see the PowerPoint --

19 20

Right.

MR. REINERT:

We're going to present it,

yes.

21

MR. WILDER:

22

MR. REINERT:

On the slide. Yes.


67

1 2 3 4

MR. WILDER:

annotate these as we go on. MR. REINERT:

Right.

MR. WILDER:

6

MR. REINERT:

All right. And I'll be asking questions

of Mr. Woodcock.

8

ARBITRATOR DAS:

9

ARBITRATOR JAFFE:

10 11 12 13

ARBITRATOR DAS:

MR. REINERT:

Yes. Because I would like to

Why don't we take a moment

to pull those out? ARBITRATOR JAFFE:

15

MR. REINERT:

16

ARBITRATOR JAFFE:

17

Right on top.

19

Is that in here?

get the PowerPoint document.

14

18

Just verbally, I'll

say the backup for this slide or these exhibits.

5

7

And then you are going to

It's up on the screen.

Yeah.

It's Exhibit 200.

Yep.

There it is.

(A discussion was held off the record.) MR. REINERT:

And I should also say Amtrak

20

Exhibit 256 is set up as a poster and also has been

21

handed out as a foldout.

22

ARBITRATOR JAFFE:

Right.


And let me ask

68

1

a question.

2

amended one that we got over the weekend, or is that

3

the original one?

4 5

I'm have no trouble either way.

I just

didn't know.

6 7

The copy that's in here, is that the

MS. WHITE: is that.

What you got on Friday evening

It has not been amended since then.

8

ARBITRATOR JAFFE:

9

MR. REINERT:

Okay.

That's fine.

This is the most current.

10

ARBITRATOR JAFFE:

11

Okay.

Friday evening, I count as the

Okay.

Fair enough.

12

weekend.

13 14 15

I knew we had gotten a revised Exhibit 200. (A discussion was held off the record.)

16 17

That's what I meant.

MR. REINERT:

Okay.

Are we all on the

same page?

18

Then I'm ready to call Charles Woodcock.

19

ARBITRATOR JAFFE:

20

Did you want witnesses sworn in?

21

MR. REINERT:

22

ARBITRATOR JAFFE:

That's fine.

Sure. Would you stand,


69

1

please.

2 3

Raise your right hand. (Witness sworn by the arbitrator.)

Thereupon,

4

CHARLES WOODCOCK

5

Called for examination by counsel for the

6

Carrier, having been duly sworn, was examined and

7

testified as follows:

8 9 10

DIRECT EXAMINATION BY MR. REINERT: Q

11 12 13

Mr. Woodcock, good afternoon. Could you please state your full name?

A

Good afternoon to the Board and members of

the BMWE and the BRS in the audience.

14

My name is Charles Edwin Woodcock III.

15

Q

And what is your current position?

16

A

My current position is the head of labor

17

relations.

18

I'm the leader, Corporate Labor Relations

19

in Washington heading up our labor relations

20

function across the system.

21 22

Q

And in preparation for your testimony

today, did you prepare a PowerPoint that has been


70

1

distributed to the Board and opposing counsel?

2

A

Yes, sir, I did.

3

Q

Okay.

Let's turn to the second page and

4

just could you explain briefly your background and

5

career with Amtrak?

6 7

A

Yes, I have been with Amtrak since June of

1975.

8

And all during that time, I have held

9

positions in the human capital area, specializing in

10

labor relations full time since 1978 in a variety of

11

field and corporate labor relations positions.

12 13 14

Q

And in the current round of collective

bargaining, what has been your role? A

I have been the chief spokesman in this

15

round of bargaining when I attained the position of

16

Leader, Corporation Labor Relations in January 2010.

17 18 19

Q

And in the last round, which led to PEB

242, what role did you have in bargaining? A

I held a coordinating role amongst all the

20

chairs and also directly chaired the Shop Craft

21

negotiations.

22

Q

This round, have you been at the table


71

1

with the PRLBC?

2

A

Yes, I have.

3

Q

All sessions?

4

A

Yes.

5

Q

And in mediation?

6

A

In mediation, yes, same.

7

Q

I'll just reference Amtrak Exhibit 201 as

8

Mr. Woodcock's bio.

9

Turn to the next slide.

10 11 12 13 14

Can you just give us an overview of what you're going to talk to the Board about today? A

Yes.

I have several components I want to

review with the Board. First is the general overview of our Union

15

environment.

16

this round, very different than in the past.

17

The second will be our approach to

I want to describe the Amtrak settlements

18

we have reached to date with our unions, briefly

19

talk about the freight settlements, but more

20

specifically the PRLBC negotiations.

21 22

And then finally, what we have done to reach deals with the PRLBC.


72

1

Q

2 3 4

Okay.

Let's turn to Amtrak's work force.

Just give us an overview of what the organizations and numbers look like. A

The overview of our organizations is we

5

have 15 labor organizations representing around

6

17,000 almost 300 workers.

7

Thirteen of the 15 labor unions have

8

reached settlements with us, which resulted in about

9

84 percent of our work force covered by the Amtrak

10 11

pattern deals. Q

In counting labor organizations, it gets a

12

little complicated, I know, and you can give more

13

detail in a moment.

14 15

But for example, both the BMWED and the BLET are Teamster-affiliated organization.

16 17

Are they counted as one union or two unions for purposes of counting 15?

18

A

They are two.

19

Q

Okay.

20 21 22

Thank you.

Let's discuss the unions that are in this interest arbitration. What portion of Amtrak's work force is in


73

1 2 3

this proceeding? A percent.

4 5

In this proceeding is approximately 16

As you can see on the PowerPoint slide, there's two units, two unions in this group.

6

One is the Brotherhood of Maintenance of

7

Way Employees, which represents employees

8

maintaining our Northeast Corridor infrastructure

9

track and structures.

10

The second group is the Brotherhood of

11

Railway Signalmen maintaining our signals and our

12

communications systems.

13

the Northeast Corridor.

14 15 16 17

And they're primarily in

And between these two unions, it's about 27 almost 2,800 workers. Q

When you look back to 2008, the headcount

appears smaller, 2,134.

18

What has been going on in these units

19

since 2008?

20

A

There has been a considerable amount of

21

work that has flowed from additional funding through

22

sources such as ARRA funding, capital funding that


74

1

has required us to increase our work force on a --

2

principally on the Northeast Corridor.

3 4 5 6

Q

There is also off-corridor positions for

these units? A

Yes.

There are at about five or six key

locations.

7

Q

8

slide.

9

Okay.

Let's turn to the table in the next

And I'll just reference for the Board's

10

purposes Amtrak Exhibits 203, 4, 5 and 6 as the

11

source of the underlying information.

12

And I'm going to ask you, Mr. Woodcock,

13

just walk us through these labor organizations for

14

purposes of who the unions involved are and what

15

type of craft or class are we dealing with.

16

A

Right.

The Joint Council of Carmen, which

17

is the first one, represents coach cleaners and car

18

repairmen or car inspectors, you know, our

19

mechanical work force.

20 21 22

As you can see, there are about 1,800 workers in that bargaining unit. Q

And you have two unions representing those


75

1

folks?

2

A

Correct.

3

Q

Which unions?

4

A

Transport Workers Union and TCU union is

5

what that membership is.

6

Q

7

front.

8 9

And something I want to get clear up

When you bargain with the JCC, are representatives of both of those unions present?

10

A

Yes, they were, as a group.

11

Q

Okay.

When you enter a collective

12

bargaining agreement, is it one or two collective

13

bargaining agreements?

14 15 16 17

A

It is one collective bargaining agreement

with this group. Q

With respect to the PRLBC, you have been

bargaining with them as a coalition.

18

Is there any expectation that you get a

19

single collective bargaining agreement out of those

20

negotiations?

21 22

A

There was not. We provided them two separate bargaining


76

1 2

documents. Q

So there's a difference between a council

3

that results in a single agreement and a coalition,

4

which will bargain together, but get multiple

5

agreements?

6

A

Yes, sir.

7

Q

Okay.

8

walk us down the list.

9 10

Turning down to the TCU -- just

The TCU, what can you tell us about them? A

The TCU is the Transportation

11

Communications Union that represents clerical

12

workers ranging from station personnel, reservations

13

personnel, back office personnel.

14

3,500 in that bargaining unit.

And, again, about

15

Q

What is ASWC?

16

A

ASWC is the second of our two councils,

17

the Amtrak Service Workers Council that represents

18

the onboard workers such as chefs, food specialists,

19

train attendants.

20 21 22

Q

And who are the constituent members in

terms of the labor organizations? A

Three unions.


77

1 2 3 4

They are Transportation Workers Union again, the TCU again, and also UNITED-HERE. Q

And, again, they produce one collective

bargaining agreement?

5

A

Yes, sir.

6

Q

Next group on the list?

7

A

The American Train Dispatchers

8

Association.

9

That is a Union that controls the

10

right-of-way of train movements.

11

distribution of our overhead power system in the

12

Northeast Corridor located in a couple of centers.

13 14

And also the

And, again, a very small union, but about 186 workers at this count.

15

Q

What is ARASA MW?

16

A

ARASA MW is one of our three supervisory

17 18 19

unions. It's American Railway Airway Supervisors Association.

20

This particular one is the supervisory

21

union that represents workers in the engineering

22

department with the other PRLBC unions.


78

1 2

Q

So they would be the folks who supervise

the BMWED and the BRS?

3

A

Yes, sir.

4

Q

Okay.

5

A

IAM is the International Association of

Tell us about the IAM.

6

Machinists, and they represent most of the workers

7

in the engine area of our mechanical department.

8 9 10

However, they do represent some employees in stations and on the right-of-way in the engineering department.

11

Q

ARASA OBS.

12

A

ARASA OBS is our on-board supervisor's

13

union, second of the two.

14

And -- excuse me, the third.

15

And they represent the supervisors in the

16

crew bases and also that travel the trains

17

supervising the on-board crews.

18

Q

Let's turn to the IBEW and explain.

19

A

The IBEW is the International Brotherhood

20

of Electrical Workers representing electricians and

21

other similar categories, mostly in the mechanical

22

department, but also in the engineering department


79

1 2

in the Northeast Corridor and elsewhere. Q

And did Amtrak reach agreements with each

3

of the unions on slide 6 according to the dates

4

indicating?

5

A

Yes.

6

Q

Are those tentative agreement dates or

7

ratified effective dates?

8

A

Those were ratified effective dates.

9

Q

And the employee headcount, as of what

10 11 12 13 14 15 16

date is that? A

That headcount is as of November of this

past year. Q

And the wages that are indicated are from

what period? A

The wages are -- what we measure is our

fiscal year.

17

And our fiscal year runs from October 1 to

18

September 30, so these are real wages through

19

September 30, 2013.

20 21 22

Q

Turning to the next page, which continues

the chart, tell us about SMART-SM. A

SMART-SM is a former Sheet Metal Workers


80

1

International union.

2

And the group represents the pipefitters

3

and plumbers in the mechanical department as well as

4

in the engineering department.

5 6

Q

And they were represented by the PRLBC at

the beginning of this round?

7

A

Yes, they were.

8

Q

FOP, who are they?

9

A

FOP is the Fraternal Order of Police

10

representing police officers throughout the country,

11

mostly in the Northeast Corridor, and about 460

12

employees there.

13

Q

NCFO?

14

A

National Conference of Firemen and Oilers.

15

It represents utility workers, stationary

16

engineers, and similar functions, mostly in the

17

mechanical department, but also in the engineering

18

department.

19 20

And they also were part of the PRLBC at one time.

21

Q

IBBB?

22

A

International Brotherhood of Boilermakers


81

1

and Blacksmiths is a unit that represents heavy

2

metal workers and welders in our back shops.

3

And about, as you see, 50 employees in

4

that unit, a former -- also with the PRLBC at one

5

time.

6

Q

BLET.

7

A

BLET is the Brotherhood of Locomotive

8

Engineers and Trainmen.

9 10 11 12

And they represent the locomotive engineers on Amtrak nationwide. Q

As you indicated earlier, they are a

Teamster affiliate?

13

A

Yes.

14

Q

You have got three SMART-Trans UTU groups.

15 16

Can you just walk us through those? A

17

Right.

They're freight.

The largest is the conductors, which is

18

the first one.

They represent assistant conductors

19

and conductors throughout the system on both yard

20

trains and our passenger trains.

21

Q

You have got stewards?

22

A

The second is the UTU dining car stewards


82

1

that represents one steward on the system working

2

out of New York.

3

Q

And the yardmasters?

4

A

And the yardmasters is a final group that

5

represents about 33 workers, and they supervise the

6

yard operations, train movements and yard operations

7

primarily with the UTU.

8 9 10

Q

And all these groups on the chart have

agreements ratified and effective as of the dates indicated?

11

A

Yes.

12

Q

Okay.

13 14

Let's turn to the next topic.

You're familiar with the Presidential Emergency Board 242?

15

A

16

Yes, sir. MR. REINERT:

And that, for the Board's

17

information, I think you have it as Joint Exhibit

18

57.

19

BY MR. REINERT:

20

Q

Can you just walk us through your

21

understanding of what occurred in the last round

22

that led to PEB 242?


83

1

A

2 3

Yes. The last round ran from 2000 to 2007 when

we finally moved forward to a PEB.

4

And during that round, we had negotiations

5

with all our unions, but had reached settlements

6

with about 35 percent of those workers through the

7

first five years.

8

the ARASA, OBS, the TCU, and the ASWC.

9

And those are the units you see,

The majority of the unions we failed to

10

reach agreement with or in some cases the agreement

11

failed ratification.

12 13 14

Q

What happened in PEB 242, in your

understanding? A

242 issued a decision which essentially

15

awarded the unions the -- a different wage package

16

and Amtrak's benefit package, but it also sent I

17

think some critical lessons, at least for Amtrak, in

18

what we should look to in our future rounds of

19

bargaining.

20

Q

How so?

21

A

Well, specifically, I think we took --

22

were taken to task on such things as delaying the


84

1

negotiations overall through that time period.

2 3

Secondly, there were issues of, Is 35 percent enough of a critical mass to form a pattern?

4

And then last but not least, they did, in

5

this case, given the fact there was no pattern,

6

recommend the freight wage and, as I said, also the

7

Amtrak medical package.

8 9 10 11

Q

And what had been Amtrak's position on

retroactivity in the last round? A

We had not wanted to pay that at all.

That was our position.

12

Q

And did the PEB 242 react to that?

13

A

Yes.

14

Among other things, that was another

15

lesson learned, I think, in terms of our position

16

which is that was not a reasonable position in this

17

case.

18

Q

Okay.

The next slide, just what were the

19

lessons coming away that you view Amtrak as having

20

obtained through 242?

21 22

A

Well, the first one, as you can see on the

PowerPoint, is don't delay bargaining and make every


85

1

effort you can to move forward.

2

Secondly, you need a critical mass, 35

3

percent of those particular unions not having an

4

operating craft, among others, was not felt to be

5

sufficient to be the governing pattern in the PEB

6

242 proceeding.

7 8

Thirdly, don't use the retroactive pay as a bargaining stick.

9

Q

In what way?

10

A

Withholding it.

11

Withholding it.

Don't pursue unnecessary issues.

There

12

were a lot of issues on that table, and we were

13

questioned about that.

14

And then last but not least, I think it

15

goes to the tenor of the tone and the overall

16

position that the Company takes, which is bargain in

17

good faith and show your efforts at the table.

18 19 20

Q

How did these lessons from PEB 242

influence Amtrak management in this round? A

Well, when I became chief negotiator in

21

January 2010, I had the opportunity to spend some

22

time with our senior manager, in particular, Joe


86

1

Boardman, our CEO.

2

And in preparation for this round, we had

3

some very frank discussions about what we wanted to

4

see occur.

5

And part of that was we wanted to change

6

the overall bargaining dynamic, which was very

7

important to senior management and Mr. Boardman

8

because he felt -- and his vision at the time was we

9

need to focus on ridership, revenue, customer

10

service, and safety as our priorities during these

11

first few years of his leadership.

12

And that we need to get the labor

13

agreements in this current round out of the way and

14

frankly not be a drag on everyone's attention,

15

including the unions, as it had been in the prior

16

round.

17

So among other things, the guidance and

18

the decision was to bargain early.

19

delay, seek out those groups that were willing to

20

bargain, and proceed, and also put proposals on the

21

table that were limited in scope.

22

No reason to

And in this case, we had a proposal that


87

1

involved very good wages at the time in the economic

2

recession, of roughly 3 percent a year, a little

3

under that.

4

Limited healthcare.

We didn't want to get

5

embroiled in a series of very difficult decisions

6

around healthcare.

7

And limited work rules.

8

And that was our approach.

9 10 11 12

And we sought

to reach these agreements within this paradigm with our unions at the time. Q

Was it your job to implement that

strategy?

13

A

Yes, sir.

14

Q

And proceeding into 2010, how did you do

15 16 17

that? A

I ended up talking to a lot of unions. And early on, several of them approached

18

me about wanting to, again, likewise not repeat the

19

last round.

20

And there was a willingness to proceed.

And indeed, we were able to do that with

21

our first tentative deals in April of 2010, which

22

involved about 40 percent of our workers at that


88

1

point.

2

Q

And which unions were they?

3

A

That was the IBEW, the IAM, the JCC, and

4

the TCU units.

5 6 7

And you can see that over on the board here, graphically, and what we have handed out. Q

In undertaking the bargaining in 2010, was

8

it Amtrak's intent to try to create a pattern in

9

this round?

10

A

11

Yes, it was. Once we had the sort of a beginning of a

12

critical mass, it became very clear that these were

13

settlements that the labor unions could work with us

14

on and negotiate around.

15 16 17

Q

And after 2010, did you continue to reach

agreements that were part of that pattern? A

18

Yes, we did. During the balance of the year, basically,

19

we reached an agreement with five bargaining units,

20

which by the end of the year took up to roughly 60

21

percent of the work force covered under deals.

22

Q

What happened in 2011?


89

1

A

In 2011, we had three unions that were

2

part of the PRLBC approach us individually at

3

different times when they broke away from the PRLBC,

4

and we reached settlements with them, which brought

5

us to about 65 percent.

6 7

And at that point at the end of the year, in November of 2011, PEB 243 was issued.

8

Q

PEB 243 with reference to the freights.

9

A

Yes, sir.

10

Q

And after PEB 243, did you continue to

11 12

negotiate with Amtrak unions for pattern agreements? A

Yes, we did.

13

The BLET came in in January of 2012.

14

the UTU groups, the yardmasters, stewards, and

15

conductors came in in April 2013 with settlement.

16

Q

So after all these events, is it your view

17

that Amtrak did, in fact, establish an internal

18

pattern?

19 20 21 22

A

And

Yes.

With currently the 84 percent now

covered under these deals. Q

Let's turn to the next page and talk about

the elements of that Amtrak pattern.


90

1 2 3

Can you explain the chart and the wage terms that are includes in the Amtrak pattern? A

Yes.

On the slide 12, which is shown on

4

the board and the handouts, the Amtrak patterns were

5

five-year, one-day deals with wage increases every

6

six months beginning in July 1 of 2010, and the last

7

one being January 1, 2015.

8 9

When you look at the total increase, it's 14.9 (sic).

10

When you compound it, it's 14.91.

Two other features in these pattern

11

settlements is a side letter with all of them at

12

this point, which is an acknowledgment that Amtrak

13

has the right to develop on top of these wages, an

14

incentive-based pay plan around such indicators as

15

customer service index, OTP, global type measures

16

that would enable the Company to incent its

17

workforce further as it strives to improve its

18

operation.

19

Q

Has that been implemented yet?

20

A

No, it has not.

21

Q

And also with respect to wages, in this

22

round, what was Amtrak's position on retroactivity?


91

1

A

Retroactivity has always been on the table

2

for those that have settled later than the July 1,

3

2010 increase, and it is still on the table today as

4

we speak.

5

Q

Let's turn and talk about what the Amtrak

6

pattern agreements provide with respect to health

7

benefits.

8 9 10 11

Can you explain that? A

Yes, sir.

We sought two elements in our

negotiations with the unions. The first was to raise the emergency room

12

co-pay from $50 to $75, unless otherwise admitted,

13

in which case it would be waived.

14

That was really to address what I think

15

was pretty widely acknowledged when you look at

16

data, an excessive amount of reliance on emergency

17

room visits, which of course drive the costs up

18

exponentially for private plans such as ours.

19

Secondly, we preserved the formula from

20

the last round on Amtrak, which is a little bit

21

different than the freight in terms of the timing.

22

But we preserved three other additional


92

1

calculations beginning in 2011, 2012, and 2013, to

2

recalculate the 15 percent based on real-time data,

3

real-time costs, and we have recalculated that.

4

Even though there were caps, we were under

5

the caps in each of those years.

6

shown of the recalculation are on the slide.

7 8

Q

And the amounts

So under the cost sharing contribution,

the basic rule is 15 percent subject to caps?

9

A

Yes.

10

Q

When do you calculate the 15 percent?

11

A

We calculate the 15 percent prior to each

12

July 1.

13

And it is based on the previous year's

14

calendar year, plan year, actual data and actual

15

costs that is shared with the Union leadership.

16

Q

So as of today, it's now $209.19?

17

A

Yes, sir.

18

Q

And that's based upon the actual

19 20 21 22

experience before July 1, 2013? A

That would be based on calendar year or

plan year 2012. Q

2012.

Okay.


93

1

Now, the -- let's talk about timing for a

2

minute.

3

effective dates vary.

4

A

On emergency room co-pays, you say the Why do they vary?

They vary because as each union would

5

settle, we would be able to implement it.

6

no retroactive adjustment to recover that from the

7

employees in later agreements.

8 9 10

Q

There's

Now, with respect to retroactivity in pay,

you said that Amtrak did place on the table retro pay with each union; correct?

11

A

Yes, we did.

12

Q

And did you pay retro pay as a result of

13 14

when you entered the agreements? A

We did pay retro pay, except I believe for

15

maybe the first couple, there were very little, if

16

any, retro pay because they came in early.

17

Q

Okay.

What did you do with respect to the

18

cost sharing contribution on healthcare with

19

represent to retroactivity?

20

A

If there was retro pay, retroactive pay,

21

and it involved one of these periods that involved a

22

recalculation, then the difference between that


94

1

recalculation each year would be offset for each

2

month against the retroactive pay.

3

Q

So you mean both the general wage

4

increases and the cost sharing contribution

5

retroactive?

6

A

7 8 9

And it has been done that way in previous rounds. Q

10 11 12 13

Yes.

Okay.

Turn to the next page.

Just give an overview of the approach on work rules within the Amtrak pattern. A

Right. On work rules, we sought to identify those

14

rules that we thought would improve the bottom line

15

administrative operation, particularly in the area

16

of payroll, but also in the time management of our

17

employees and promote a more collaborative effort.

18

And that's what you see on this first

19

slide of 14, what we're calling administrative type

20

rules both in terms of payroll efficiency and

21

certain discipline rule modifications.

22

And then on top of that, most rules --


95

1

most units and agreements we had what we call

2

craft-specific rules that was part of the Amtrak

3

pattern, but they would of course vary by craft.

4 5

Q

Okay.

Let's focus, drill down a little

bit on the administrative work rules.

6

Can you explain what was provided within

7

the Amtrak pattern agreements with respect to

8

payroll efficiencies?

9 10

A

Yes. Where we did not already have either

11

bi-weekly pay or direct deposit, what we did is

12

implement a rule that would allow us to move to

13

bi-weekly pay.

14

And indeed, all our unions but the two

15

here today have been moved to bi-weekly pay along

16

with management.

17

The second piece was that we wanted to

18

have it be a mandatory direct deposit.

19

was designed to improve the efficiency of the

20

payroll operation.

21

efficiencies which were important to us.

22

All of this

And, again, the back office

And then lastly, as part of implementing


96

1

that back office function, rather than have multiple

2

payrolls running at different times, this now

3

standardized for payroll purposes a payroll work

4

week of Monday 12:01 a.m. through Sunday, so that we

5

now have a standardized run of each payroll each

6

week.

7 8

Q

So does that also cover all unions that

are in the Amtrak pattern?

9

A

Yes.

10

Q

Some of these unions had these provisions

11

before this round?

12

A

Correct.

13

Q

Okay.

14

modifications.

15 16 17 18

Let's talk about the discipline

First, what was done within the pattern on alcohol and drug waivers? A

There were two items. First of all, the first one as you can see

19

on the slide, and it is contained in our proposals,

20

is that where there were employees on what we call

21

drug and alcohol waivers -- and in our proposals, we

22

have a sample waiver form that's pretty standard --


97

1

but where we had employees that were already under

2

waiver conditions, including and understanding they

3

could be dismissed if they violate the waiver, what

4

we sought to do is eliminate the first level

5

investigation that's done.

6

It's an administrative proceeding usually

7

done with local chairmen, district chairmen, as well

8

as first level line officers.

9

right to Labor Relations so that the waiver can be

And elevate that

10

implemented, and the person can be dismissed if they

11

violate it.

12

But that that appeal would now accelerate

13

through the system right to Labor Relations, where

14

we would have to develop the proof, develop the

15

record primarily in the form of a drug litigation

16

package, and then hear any particular appeal

17

contentions and form the record there.

18

Q

Why did Amtrak want that change?

19

A

Basically, because the people at the lower

20

level not only are ill equipped to deal with 75-,

21

80-page, 100-page drug litigation packages, and we

22

rarely get to the questions that need to be asked.


98

1

But frankly, arbitrators consistently have

2

upheld the dismissal of folks who violate their what

3

we call Rule G or drug and alcohol waivers.

4

most of time that involves testing positive for a

5

drug event.

6

Q

7

10 11

There were other changes with respect to

the notice of intent to impose a discipline meeting.

8 9

And

What is that about? A

Yes.

This is an item we wished to

standardize across all the crafts where we could. This was first started in the 1988 round

12

of bargaining with a couple of our unions and has

13

proven to be immensely successful.

14

What this is, is before you proceed in

15

cases of less than dismissal where you are going to

16

proceed with potentially discipline, before you

17

proceed in a formal investigation, it requires the

18

parties to come in and talk about the misconduct.

19

It's an informal procedure, and the hope

20

and the intent is that the parties can reach a

21

resolution around that misconduct, how it will be

22

dealt with, what the circumstances might be, et


99

1

cetera.

2

It's an informal process, and it has

3

proven to be very successful without any issues with

4

the crafts we have.

5 6

Q

Are there some crafts that don't gave this

provision under the Amtrak internal pattern?

7

A

Yes, there are.

8

Q

And which crafts are they?

9

A

Well, the operating crafts are the ones

10

that don't.

11

Q

And why is that?

12

A

Because we tried to pursue in negotiations

13 14

whether we could implement this. But because of, among other things, the

15

Conductor and Engineer Review Board requirements

16

with the FRA -- and we also consult with the FRA --

17

it was felt within the time the parties had that we

18

would not be able to implement that with the

19

operating crafts that really work together very

20

clearly in operating areas.

21 22

And would require a federal -- a record for the federal boards to review.


100

1 2

Q

So that's a federal requirement for a

formal record?

3

A

Yes.

In most of those, yes.

4

Q

You made reference to the Amtrak

5

craft-specific work rules, and I want to take some

6

time to walk through these so that the Board

7

understands what they're about.

8 9 10

And I should say that while these are in all the agreements, there's also a summary table that's Amtrak Exhibit 248.

11

But let's discuss those craft-specific

12

rules.

13

work rules changes come about?

14

A

How did the whole idea of craft-specific

When we began our round and had our

15

various chief line officers, one of whom was Bruce

16

Pohlot and his predecessor Frank Vacca, you will

17

hear from next week.

18

We met with the department and tried to

19

find those items that we felt we could address

20

certain issues that were problems for our line or

21

operations departments.

22

So we did not have a broad targeting, as I


101

1

said early on.

2

limited scope, but things that needed to be worked

3

on on the surface.

4

identify those types of rules.

5 6 7

Q

We wanted limited proposals of

And that's how we proceeded to

And what was Amtrak's goal in pursuing

this at the table? A

Our goal was to negotiate with these

8

unions over these areas that were important to our

9

line officers and try and reach agreement in ways

10

that would correct or help us manage those areas.

11 12 13

Q

Can you just walk us through some of the

things you achieved with the Shop Crafts? A

14

Sure.

Sure.

The first one is we kept what's called

15

bank time, bank or compensatory time.

16

a critical, critical rule.

17

And this was

The previous rounds, we had negotiated the

18

comp time, but it did not have a cap.

19

I think the people felt that it would not be used

20

that much.

21 22

But it was just the opposite. a considerable amount of time.

And frankly,

It was used

And so what the


102

1

parties ended up doing here is putting caps on that

2

as to how much could be taken each year, and that

3

was critical to our mechanical department.

4

Q

What about the work week?

5

A

The work week allowed us to implement

6

4-by-10 work weeks in the areas of production and

7

lifecycle maintenance and periodic maintenance in

8

our terminals.

9

4-by-10 days of -- as long as they had

10

Saturday, Sunday work weeks, but we were able to get

11

that for our mechanical department.

12

Q

Probationary periods?

13

A

Probationary period, what we did there, we

14

expanded the probationary period from roughly three

15

months to six months of active service.

16

And more importantly, we had an

17

understanding, and it's written in, that we could

18

utilize the employees during that six months on any

19

work at the particular shops, any shifts, any

20

locations.

21

management effort to develop a training program for

22

new hires, which is currently in place.

And it facilitated a joint labor


103

1 2 3

Q

What did you negotiate with respect to the

NCFO concerning rate of pay? A

4

Yes. The NCFO, I had a classification of

5

utility worker, which we agreed to lower the rate of

6

pay for new hires and extend the entry rate time

7

line from three to five years as a way to help us,

8

not only lower labor costs, but the NCFO saw it as

9

an opportunity maybe to have Amtrak hire more of its

10 11

utility workers. Q

Okay.

What was done with respect to the

12

sheet metal workers in the terms of the scope and

13

work classification?

14 15

A

The last one is a good example of a very

unique craft issue.

16

Unique in that the sheet metal workers

17

came to the table with something that was important

18

to them.

19

They had what's called an equity number.

20

It was a hard based number that would float up and

21

down, which, in return for relaxing their scope rule

22

back in the 1988 round of bargaining, we agreed to


104

1

actually maintain a certain level of those workers.

2

Again, subject to some changes in fluctuation and

3

operations and funding.

4

However, the sheet metal workers came to

5

us and indicated they would prefer to have a hard

6

core -- hard capped percentage of mechanics, a

7

relationship with other mechanics in the shops.

8

And we agreed to that.

9

And in return for that, they completely

10

waived their scope rule so that they now have a

11

relationship number.

12

flexibility with that craft to have other crafts do

13

their work.

14

Q

But Amtrak in turn got total

Let's turn to the operating crafts and ask

15

you to explain some of the items that were

16

negotiated there.

17 18

A

Yes. One of the common themes that you see

19

there is that early on, right around the time of

20

opening the round of bargaining, we had had a

21

situation where we had a competitor come in and try

22

to come in and take an operation from us, which they


105

1

did.

And they wanted to basically offer employment

2

to all of our workers having themselves zero

3

workers.

4

And what we said is this was an untenable

5

position for the Company to be in to invest in our

6

workforce.

7

So with our operating crafts, similar to

8

what we already had with our police, we had what we

9

call a repayment of training costs so that these

10

folks, should they leave the Company voluntarily,

11

within three years, they would owe us a cascading

12

amount of money during that three years to recoup,

13

for Amtrak to recoup those payment costs.

14

Q

Would did you --

15

A

Training, training and ancillary costs.

16

Q

What did you negotiate with the ATDA on --

17

A

ATDA, we extended the probation period

18

there to 120 days of compensated service from 60.

19

And that's important to give us an

20

opportunity to look at the train dispatchers and

21

their active duty.

22

Q

And in the probation rule on Smart C


106

1

(UTU)?

2

A

The promotion rule was one where the

3

UTU -- and we'll discuss that a little later.

4

UTU and Amtrak decided to modify the promotion rule

5

that accomplished, not only giving Amtrak

6

efficiencies, training investment recovery, and

7

lock-ins, but also -- also gave the UTU money that

8

they felt was important to their craft for the new

9

federal certification requirements that were put on

10

The

them in Federal Regulation 242.

11

Q

We'll talk about that some more later.

12

A

Yes.

13

Q

Okay.

Turning to the next page and

14

continuing to review the craft-specific work rules,

15

tell us what you negotiated with ASWC.

16 17 18

A

The ASWC is another example of the rule

that was helpful to both parties. There was a rule on how we compensated

19

folks for block training, those that had attended

20

annual block training.

21

earnings rather than just a flat eight hours.

22

And we agreed to pay their

But in return for that earnings, if we


107

1

pulled them from their job, that amount of time over

2

and above eight hours a day is credited towards

3

their guarantee, but not their overtime hours for

4

the end of the month.

5 6 7

Q

What about food specialist?

What did you

change there? A

8

Yes. We provided what I would call scope

9

classification flexibility in that we had a series

10

of food specialists furloughed at the time, and we

11

generally do each year.

12

In that category, these are employees that

13

work in the back -- in the back of the diner, not

14

the public section.

15

And this allows us the ability or the

16

incentive to recall food specialists because now

17

they can perform any work in the dining room.

18

that might include helping to wait on tables during

19

an overflow period on a heavy train, particularly,

20

say on a Friday night boarding, things like that.

21 22

Q

Explain what you changed on the

expungement of misconduct.


So

108

1

A

2 3

Yes. The ASWC and the TCU had what I would call

an automatic expungement rule.

4

And prior to this time, with certain time

5

frames of good behavior, there were a series of

6

misconducts that could be expungeable that, again,

7

consistent with a new direction of focusing on

8

customer service and ridership, we found to be very

9

difficult to have that happen.

10

So instead of having just dismissals and

11

drug and alcohol waivers that formally couldn't be

12

expunged, we expanded that into a series of other

13

areas like theft, customer interactions and customer

14

misconduct, and what I would call anti -- violations

15

of our anti-harassment policy.

16 17

Q

part-time to full-time lock-in?

18 19

Turning to the TCU, what did you do on

A

That was an area that was specific to the

RSOs.

20

In the RSO, we have a considerable number

21

of part-time workers.

22

700.

I would say close to probably


109

1

And we had a situation there with the way

2

the rules worked where employees could actually

3

leave the RSO to take a full-time job out in the

4

stations or some other area, and then have the right

5

to come back into the RSOs as full time.

6

And this created problems, not only within

7

the cost structure of the RSOs when they returned;

8

but more importantly, it created problems with the

9

receiving department that was taking them on and

10

training them, principally in the stations area,

11

such as Los Angeles, where we have a major center.

12 13 14 15

And so this now requires the employees to stay there for up to one year and be locked in. Q

Okay.

You have already mentioned

misconduct expungement with respect to ASWC.

16

Same with the TCU?

17

A

Yes, sir.

18

Q

ARASA ME.

19

A

The last one there, a small supervisory

20 21 22

What did you negotiate?

union that we had. We had a sort of a related bank time or compensatory time problem in that their rule


110

1

required them, mandated that they bank the first 40

2

hours of their overtime.

3

And now, what we did is we made that

4

unmandatory so that now we actually have supervisors

5

who are on the job and not taking compensatory time.

6

Q

In your view, in these craft-specific work

7

rules that you have just discussed, do they provide

8

advantages to Amtrak?

9

A

Yes, they do.

10

Q

Now, are there any unions with whom -- or

11

within the Amtrak pattern that have not included

12

similar types of craft-specific work rules?

13

A

There are a couple of our smaller units

14

like the one-person dining car steward, the ASW --

15

excuse me, the ARASA MW, the ARASA OBS, those were

16

crafts that are supervisory unions.

17

much need for them.

We don't have

18

And then the FOP, which completely we

19

overhauled their agreement in 2007, a brand-new

20

collective bargaining agreement.

21

Q

And that overall accomplished what?

22

A

That particular overall accomplished


111

1

development for the first time in a true what I

2

would call police-oriented agreement with such

3

things as management rights, broad powers of the

4

chief, and rules that really were important to both

5

the police department, the police chief, and the

6

police union.

7 8

Q

Let's turn to timing and duration under

the Amtrak pattern agreements.

9 10

Can you just explain what the opening and duration provision of these agreements provide?

11

A

Yes, sir.

12

As I said earlier, and you can see on the

13

slide, these pattern agreements are five-year,

14

one-day agreements running from January 2010 through

15

January 1, 2015, inclusive.

16

There are ten general wage increases, 1 to

17

1.5.

And the last wage increase is on the last day

18

of the contract, January 1, 2015.

19

Health and welfare has an early reopener

20

on May 1, 2014, not to become effective before July

21

1, 2014.

22

And wages and work rules are open for


112

1

negotiation November 2, 2014, not to become

2

effective before January 2, 2015.

3 4 5

Q

Why is there an early reopener in health

and welfare? A

That was part of the bargaining we had

6

with the unions that, because we weren't seeking a

7

lot, we were worried, as are most employers today,

8

about what was happening in health care, not to

9

mention the ACA, the legislation.

10

And we desired to open up early to get a

11

jump on that issue depending what we were faced with

12

at that time.

13 14

Q

Let's discuss the me-too provisions that

have been referenced previously.

15

And I would reference Amtrak Exhibit 216,

16

page 11, I think is the first contractual language

17

of the JCC.

18 19 20 21 22

Can you explain to us how the me-too provisions in these agreements came about? A

Yes. After our first settlements -- and I had

made assurances at the table, as I believe most


113

1

negotiators do, but I had made assurances at the

2

table.

3

And one union in particular approached me

4

and asked me if, despite those early tentative

5

settlements during the voting, I would codify that

6

understanding, and I said I would.

7

And that has been reflected in the

8

language you see here, and that has been replicated

9

in each of our agreements that we have reached to

10

date.

11

Q

What was the purpose of these me-too

12

agreements?

13

A

The purpose of the me-too agreement was to

14

basically give those early unions that stepped out

15

and had a desire to reach settlements, to give them

16

a comfort level that, if, should there be additional

17

general wage increases and benefit changes, that

18

they would be able to also enjoy those, with the

19

exception if they were for work rules or other

20

productivity and other offsetting changes, again,

21

they would have that option also.

22

Q

Explain how that exception for work rule


114

1 2

offsets works in your understanding. A

Well, the way it would work, in my

3

understanding -- obviously I may have a difference

4

of opinion with the Union -- but the way it would

5

work and the way I intended it was that, should we

6

give improvements in the area of benefits and GWIs,

7

that I would approach the unions; they could

8

approach me, and then we would discuss that.

9

If it was simply that there were no

10

offsets, then there would be no offsets.

11

Amtrak strategy was that we said that, Should you

12

have any additional issues that you want of GWIs or

13

benefits, we would have expected an offset against

14

those one for one.

15

Q

But in the

There has been some discussion with

16

respect to the UTU conductor agreement and what

17

impact it has on the me-too clauses.

18 19

Has any union filed a grievance under the me-too clauses?

20

A

No.

21

Q

Let's turn to the next slide, and I will

22

reference Amtrak Exhibits 234, 238, and 239 if the


115

1

Board wants to look at the agreement.

2

But explain to us what happened.

Did the

3

PRLBC coalition remain stable throughout this

4

bargaining round?

5

A

6

No, it did not. The original five unions of the coalition,

7

as you can see on the slide, boilermakers, firemen,

8

or other sheet metal workers, BMWED, here today, and

9

the BRS here today.

10 11

And indeed, common notices were formed, and they were served on Amtrak in April of 2010.

12

However, in 2011, each of these unions,

13

the sheet metal, NCFO, and boilermakers broke from

14

the coalition and approached us about reaching deals

15

very similar to the other Shop Crafts that had

16

already settled on Amtrak.

17

Q

And is there any reason you're aware of

18

that these unions broke away from the PRLBC

19

coalition?

20

A

I am not aware of any unions, what their

21

rationale might have been, and I wasn't privy to

22

that.


116

1 2

Q

Did PRLBC do anything to prevent them from

breaking away?

3

A

Not that I know of.

4

Q

Let's turn to the next page and talk about

5

the UTU agreement, which is Amtrak Exhibit 245.

6 7

Did operating unions also join the Amtrak pattern?

8

A

Yes, they did.

9

Q

And which operating unions?

10

A

The two principal ones would the BLET and

11

the UTU, as I have already alluded to.

12

We have the dispatchers also in this

13

group.

14

Q

15 16 17 18 19 20

Tell us about the UTU conductor agreement

that was reached as part of the pattern. A

Well, we had been discussing with the UTU

the parameters of the deal for some time. And even after the freight deal, they were comfortable with the Amtrak pattern. However, one of the items that they had

21

asked us for was the equivalent of some form of

22

conductor certification pay, which they had received


117

1 2 3

on the freights and other property. Q

And in dealing with that response, were

you cognizant of the me-too clauses?

4

A

Yes, I was.

5

Q

And how did you deal with that?

6

A

Well, it was always in the back of our

7

mind that, if we were to offer additional money,

8

depending how it was structured, that we could be

9

subject to a me-too.

10

But we were fortunate in being able to

11

reach a solution with the UTU that did not trigger

12

what I would call either benefit improvements or

13

general wage increases on top of this.

14

Q

15 16

And how did you structure that agreement? Turn to the next slide.

A

Well, I think the best way to describe is

17

this that this is a product of difficult creative

18

negotiating in that it solved for us some critical

19

operating issues that were unique to us.

20

And also turned around to produce

21

potentially additional what I would call pay in the

22

form of lump sums, and I'll describe them in a


118

1

minute, for the workers in return for some of the

2

increased responsibility that they now bear under

3

the Federal Reg 242.

4

Q

Explain how the bonus works.

5

A

The bonus has two pieces.

6

First of all, it took our promotion -- and

7

we already had an existing promotion rule, and

8

worked on those issues that Amtrak had that we

9

needed to address with this particular rule and this

10 11

particular Union. Unlike some properties, we have both

12

assistant conductors and conductors.

13

given day, we have about 1,300 conductor's jobs that

14

are out there.

15

And on any

And unfortunately, through the way the

16

seniority system works, the assistant conductors do

17

not, even after training, have to hold conductor

18

positions and have to hold their qualifications.

19

And this creates additional staffing for us as well

20

as turnover and additional training costs and

21

filling vacancy costs.

22

So what we decided to do is take an amount


119

1

that would roughly equate to a little over $5 a day,

2

which the UTU had sought from us in a form of pay,

3

and that was what I would call translated into these

4

bonuses.

5

The first one is the $250 bonus that you

6

see here, and it's in the UTU deal, for further

7

examination.

8

What that does is several things.

9

First of all, you must, in order to get

10

the equivalent of this $250, maintain all of your

11

qualifications as well as certification under 242.

12

So now you have to maintain

13

qualifications.

14

characteristics.

15

negotiate, and you can see that.

16

You have to maintain your physical And that's in the rule that we can

But for the first time now, as a condition

17

of employment, in order for you to remain employed,

18

and under the promotion rule, after a year, you have

19

to take the promotion exam; you have to keep your

20

certification and qualifications up in order to get

21

that 250 as a condition of employment.

22

What that means is, even though you may


120

1

work as an assistant conductor, you now must

2

maintain that certification.

3

So this gives us a pool of qualified

4

physical characteristic, qualified and certified

5

employees we now would not have had except for this

6

rule.

7

That was the first part.

8

The second part, we then took that as a

9

preliminary you must have this before you can

10

advance to the next two bonuses, which were two $500

11

bonuses on the line.

12

And what those were designed to do is that

13

provided you not only held a conductor position the

14

whole measurement period of those six months, but

15

you actually rendered a certain amount of qualified

16

time, which was 120 days, except for 118 in certain

17

periods.

18

And that's in the rule. So it not only says you have to come to

19

work and fulfill that service, holding a conductor

20

position, but you have to commit a certain number of

21

times per year.

22

So in reality, although it looks like


121

1

everyone is going to get $1,250, the reality is it's

2

much less than that based on our estimates going in.

3 4 5 6 7 8 9

But those are the essential elements of the rule. Q

And what advantages of staffing does

Amtrak get out of that? A

Well, it's several. First of all, we predict we're going to

have to hire less conductors overall because now

10

that we have this pool underneath that we can pull

11

and assign as needed assistant conductors going up

12

to conductor positions.

13

So we are estimating, I believe, the

14

number originally was maybe as many as 30 positions

15

we might not have to hire for.

16

Secondly, it now gives us the ability to

17

fill the actual assignments should a conductor mark

18

off and not be available.

19 20

This is critical, particularly at smaller crew bases.

21

A lot of people don't realize, we have

22

almost 70 crew bases around the country, some of


122

1

which have as few as seven conductors and assistant

2

conductors.

3

fill positions.

So it can be very challenging for us to

4

And then thirdly, it's going to reduce the

5

training need because, again, as people retain their

6

qualifications and that pool retains its

7

availability, it is going to enable us to fill those

8

jobs.

9

And then lastly, we think there's not only

10

going to be improvement in the attendance and in

11

less discipline, but also we'll have a spillover

12

effect that we'll be able to better crew our

13

training when we run short such as periods like

14

right now with inclement weather in the northwest,

15

one of our trains where we're cutting crews short.

16

So it gives us a lot of advantages.

17

Q

You negotiated other agreements with the

19

A

Yes.

20

Q

Which agreements were those?

21

A

The yardmasters and the stewards.

22

Q

Was there any monetizing the certification

18

UTU?


123

1

pay from the UTU conductor agreement as GWIs in

2

those agreements?

3

A

4 5 6 7 8

No.

There was no monetizing of that.

They did not receive any additional compensation of any type. Q

Okay.

So overall, in your view, is there

an Amtrak internal pattern? A

9

Absolutely. We believe that it's irrefutable.

When

10

you have got 84 percent of your workers covered

11

under the same type deal, then you have got

12

basically a pattern.

13

Q

And in statements to employees and public

14

statements has Amtrak said it has an internal

15

pattern?

16

A

Yes.

17

Q

Have the unions referred to this as an

18

internal pattern?

19

A

Yes.

20

Q

And in what context?

21

A

In some of their newsletters.

22

Yes, they have.

Also at the table, to be frank about it.


124

1

Q

2 3

Okay.

Turn now to freight.

You're familiar with what has gone on in bargaining of the freights in this round?

4

A

Yes.

5

Q

In your position, do you keep track of

6 7

that. A

8 9 10 11

From a distance. We don't have as much of an interest to

know exactly what's going on, but certainly we are aware of it. Q

And you're familiar that the UTU is the

12

only union to reach a voluntary agreement on

13

freights this round before a PEB.

14

A

Yes.

15

Q

And you're familiar with PEB 243?

16

A

Yes.

17

Q

The BMWE ultimately reached a deal with

18

the freights.

19 20 21 22

Was that brought to your attention? A

I was aware that they had reached a deal. And then it was brought to our attention

when we first met in 2012 with the BMWE and the BRS.


125

1 2

Q

And have you had an opportunity to review

that agreement?

3

A

Yes.

4

Q

In your slide, there's a reference to the

5

BMWE and the BRS freight deals reached 18 months

6

after the Amtrak pattern set.

7 8 9

How are you counting there? A

Well, when you count from April forward,

or when we reached the tentatives, or again the

10

February date which was the BMWE tentative, or their

11

sign date of April, you're going to get in the 18

12

month ballpark, April of 2012 when they finally

13

signed.

14 15

Q deal.

16 17 18 19 20

Let's review the terms of the freight

What's your understanding of their wage settlements? A

The freight deals appear to have these

yearly increases, which are shown on page 25. And they have what I would call yearly

21

increases beginning each July.

They vary in amount.

22

Additionally -- and totals compounded about 20.1


126

1

percent.

2

Additionally, they have a 1 percent

3

straight-time earnings lump-sum payment what is for

4

the period of November 2010 through October 31,

5

2011.

6

And then last but not least, one other

7

unique feature is the last wage increase, which is

8

January 1, 2015, is what I would call a contingent

9

wage increase that, as long as the parties maintain

10

negotiations at the table and direct negotiations

11

that don't go external, it is understood you might

12

be able to negotiate that up or down.

13

But the fact of the matter is, if you go

14

external, there is some other way of solving the

15

dispute.

16

year for wages.

17 18 19 20 21 22

The way we read it, that becomes a sixth

So de facto, it's a sixth year for wages. Q

Okay.

With respect to health benefits,

what do freight deals provide? A

The freight deal appears to have

considerable plan design changes. Not only have they gone to the same Amtrak


127

1

$75 co-pay for emergency room, but they went further

2

in a series of what I would call design changes,

3

adjusting co-pays, pharmacy co-pays, certain

4

pharmacy benefit management rules.

5

center, convenient care co-pays were decreased.

6

Phased implementation of deductibles and

7

out-of-pocket maximum.

8

introduction of a 5 percent coinsurance feature with

9

caps in that deal.

10

Urgent care

And then also an

Additionally, they had a $200 cap, as we

11

read it, through 2015.

12

what I would call snap-up to potentially a $230

13

amount in that -- those deals.

14

Q

And then in 2016, there is a

And do you know when the health plan

15

design changes under the freight deals are

16

implemented?

17

A

18 19 20 21 22

They were phased based on a July '12. And then also some were phased into '13,

and some were phased into '14. Q

There are no work rule changes under the

freight deals? A

No.


128

1

Q

Do you know how that came about?

2

A

Well, certainly if it's based on the PEB's

3

recommendations, they recommended that work rules be

4

dealt with locally, in essence.

5 6 7

And I think the parties followed that. Q

Had the carriers sought any work rule

changes?

8

A

Not that I know of.

9

Q

And let's turn to the timing duration of

10

the freight deals, which gets a little complicated,

11

but explain to me whether they're five-year or

12

six-year deals.

13 14 15

A

Well, they are very different than the

Amtrak deals. For other than wages, they are clearly

16

five-year deals.

For the last wage increase, the

17

way we read the side letter, the last wage increase

18

of 3 percent, January 1, 2015, will remain live for

19

negotiation as long as the parties retain the

20

negotiations at the table should they go to a third

21

party for a resolution, that de facto becomes the

22

sixth year of wages and that closes out that year.


129

1 2

MR. REINERT:

Okay.

Mr. Chairman, I think

this would be a good point to take a break.

3

ARBITRATOR JAFFE:

4

Looking at five to ten, maybe 15.

5

MR. REINERT:

6

ARBITRATOR JAFFE:

7

We're off the record.

8 9 10

Sounds fine.

Let's do ten. That's fine.

(A recess was taken.) BY MR. REINERT: Q

Let's change gears a little bit, and I'm

11

going to ask you some questions, and you'll provide

12

some explanation on the -- really the chronology of

13

the discussions with the PRLBC.

14

Some of this you have referenced already.

15

It's laid out in the chronology document, which I

16

have behind me.

17

What I really want to start in April 26,

18

2010, when you had a discussion with the PRLBC

19

concerning the ground rules for coalition

20

bargaining.

21 22

When you went to that meeting, did Amtrak already have agreements, tentative agreements in


130

1

place?

2

A

Yes, we did.

3

Q

And with which unions again?

4

A

We had them with the IAM, the JCC, IBWM

5

(phonetic), and TCU.

6

Q

And that represents what percent?

7

A

About 40 percent of our workforce at that

8 9

time. Q

So in the April 26 session, did you

10

identify to the PRLBC that you had these tentative

11

agreements in place?

12

A

Yes, I did.

13

Q

And what was the reaction?

14

A

I think it was somewhat surprised.

15 16 17

I'm not sure what they had known about it. Q

To your knowledge, did they know about the

tentative agreements before?

18

A

I'm not sure that did, as I remember it.

19

Q

Did the PRLBC communicate to its

20 21 22

membership concerning the new agreements? A

Well, yes, they did, in the newsletter

that was put out dated May 9.


131

1

MR. REINERT:

And for the Board's

2

information, that's Amtrak Exhibit 249, but I'm not

3

going to focus on it right now.

4

BY MR. REINERT:

5 6 7 8

Q

When did you actually start bargaining

sessions with the PRLBC? A

Our first bargaining session was on May 14

of 2010.

9

Q

And what did that consist of?

10

A

That consisted of reviewing the combined

11

as well as the individual portions of the combined

12

Section 6 notices by the five unions party to the

13

coalition at that time.

14 15

Q

So at that time you did include the NCFO,

IBBB, and sheet metal workers?

16

A

Yes.

17

Q

Now, turning to the next page, when was

18 19 20 21 22

the next bargaining session? A

The next bargaining session was June 4,

2010. Q

And what occurred in the June 4, 2010

bargaining session?


132

1

A

During that session, we offered a

2

comprehensive proposal for settlement that was

3

patterned after the existing settlements that we had

4

reached that dealt with wage, medical, and certain

5

work rule items.

6

MR. REINERT:

And for the Board's

7

information, those are Joint Exhibits 14 and 15.

8

BY MR. REINERT:

9 10

Q

Did you explain the proposal to the PRLBC

representatives?

11

A

Yes, we did.

12

Q

And what was the reaction?

13

A

The reaction was that it was simply not

14

enough in terms of their desires, their goals,

15

didn't have enough economic value.

16

And then they also asked us a series

17

questions, which we agreed to provide answers to on

18

the work rules.

19

Q

When was your next bargaining session?

20

A

Next bargaining session was August 11,

21 22

2010. Q

And what occurred at that session?


133

1

A

Well, during that session, we agreed to

2

provide additional work rule options that we felt

3

could provide an option to pay additional monies

4

over and above the Amtrak package, over and above

5

the baseline work rules that were common to most of

6

the crafts.

7

Q

And why were you doing that?

8

A

We were seeking a way to find a way to

9 10

reach settlement with these groups, and basically produce an agreement.

11 12 13

And as I said, continue to reach deals that would further both parties' interests. Q

And did Amtrak provide the PRLBC greater

14

information about the work rule proposals and

15

possibilities for savings?

16

A

17

Yes, we did. At that particular meeting, we handed out

18

a series of documents that were tailored to each

19

group, and I believe they are in the record today.

20

Q

21

through 22.

22

I believe those are Joint Exhibits 16

Did you continue during 2010 to discuss


134

1

Amtrak's work rule suggestions and potential savings

2

calculations?

3

A

4

Yes, we did. And also we made a series of informational

5

and proposals around healthcare.

And that was done

6

in December 15, 2010 that there was an exchange of

7

quite a lot of information both in response to PRLBC

8

questions, but also in our desire to find additional

9

options particularly in healthcare.

10

And that was done at the December 15, 2010

11

meeting that was attended by our consulting team Aon

12

Consulting.

13

Q

And was the information you exchanged with

14

the PRLBC focused on healthcare and work rules

15

generally?

16

A

Generally, yes.

17

Q

Okay.

Turning to Slide No. 32, did you

18

later learn that the BMWE had been communicating to

19

its membership in the December 2010 time frame?

20

A

Yes, we did.

21

Q

And what did you learn?

22

A

We learned of a December 6 letter, which


135

1

is identified on the slide there, communicating with

2

their members about various positions that they

3

were communicating on the negotiations and their

4

views of how the negotiations should proceed.

5 6 7

Q

And what was your interpretation of that

letter? A

Well, my interpretation first and foremost

8

was that they had decided to wait until there was a

9

freight deal.

10 11

I think that's pretty clear when you look at the latter in totality.

12

They also indicated it was essentially

13

dangerous to follow any kind of internal pattern,

14

and I think that influenced their decisions

15

throughout the rest of the negotiations.

16

And then last but not least, they

17

indicated that the Amtrak settlement in their mind

18

was inadequate to their needs.

19

MR. REINERT:

And for the Board's

20

purposes, the letter is Amtrak Exhibit 250.

21

BY MR. REINERT:

22

Q

Looking back over the course of


136

1

bargaining, how does the December 6, 2010 letter

2

relate to what you saw and heard in bargaining at

3

the table?

4

A

Well, I think particularly looking back on

5

it, after this time, but also before the time, but

6

clearly after this time, as I'll explain in a

7

minute, it was a decision basically not to bargain

8

with us.

9

Q

10 11 12

Let's turn to the next slide. Did the December 6 letter also refer to a

survey of the membership? A

Yes.

13

It surveyed their membership as to whether

14

they should continue to work at the table or whether

15

they should wait in essence for the freight deal.

16

Q

17 18 19

And I'll reference Amtrak Exhibit 251. What's your understanding of the outcome

of that survey? A

My understanding, based on the January 10,

20

2011 survey results, was that almost 86 percent of

21

respondents voted to make a decision about what to

22

do after the freight settlement.


137

1 2

And roughly 15 percent voted to accept the Amtrak's pattern offer.

3

Q

So after that January 10, 2011, BMWE

4

communication concerning the member survey, what was

5

the next development in bargaining with the PRLBC?

6

A

Well, at that December meeting, we had set

7

a next bargaining date for I believe it was March

8

11.

9

And on March 7, I received a communication

10

from the PRLBC indicating they were postponing

11

the -- excuse me, the March 9, they were postponing

12

the March 9 session.

13 14 15 16

Q

After the PRLBC postponed the March 9

session, did you meet with them again in 2011? A

We did not meet with the PRLBC, the two

unions here today, at all.

17

Q

18

PRLBC?

19

A

What happened in 2011 with respect to the

In 2011, we got approached by three of the

20

other members of the PRLBC at different times, but

21

first was the sheet metal workers.

22

And we were able to reach a settlement


138

1

with the sheet metal workers as you can see on this

2

slide on April 19.

3 4

The firemen and oilers came in next and reached settlement with us on August 30.

5 6 7 8

And last, the boilermakers reached settlement with us on September 8 of 2011. Q

When did you next meet with the PRLBC

constituted now by the BMWE and the BRS?

9

A

We next met with them in February of 2012.

10

Q

Anything else happen in late November with

11 12 13

respect to negotiations? A

Well, as you can see on slide 35, the PEB

243 report came out November 5.

14

And then many unions, including the two

15

here today, reached deals, settlements.

16

reached a settlement on November 17.

17

ratified and signed on February 6.

18

And the BRS

It was

The BMWE reached tentative on February 2,

19

2012, and it was ratified and finalized on April 25,

20

2012.

21 22

Q

And how did it come about that Amtrak and

the PRLBC got back to the bargaining table?


139

1

A

The PRLBC called us on January 26, and we

2

exchanged dates to find a common set of dates that

3

we would be able to meet.

4 5 6 7 8

And we were able to come up with February 13 of 2012, which was our next bargaining session. Q

What happened at the February 13

bargaining session? A

At the February 13 bargaining session

9

because of the length of time that had transpired,

10

Amtrak first desired to review what had transpired

11

up to that date, and reoffered the terms of our June

12

comprehensive proposal.

13

In addition to that, we offered as a way

14

to move negotiations forward what I would call an

15

interim deal, essentially taking care of the upfront

16

economics that were common.

17 18

Just happened to work out that they were the same through June 30, 2012.

19

Q

What was the same?

20

A

The general wage increases when you add

21 22

them up. Q

Between the freights and the Amtrak


140

1 2

pattern? A

3

Yes, yes. And it was a desire to continue to move

4

forward on general negotiations, recognizing a lot

5

of items were unsettled.

6

wages up through that point.

7 8 9 10 11

But it was settling the

And certain other items such as supplementals. Q

And how did the PRLBC react to that offer

for an interim settlement? A

They rejected it and indicated that they

12

had another option they wished to put on the table,

13

which at this point was before lunch.

14 15

And then we came back after breaking, and they did put another option on the table.

16

MR. REINERT:

So just for the Board's

17

reference, Joint Exhibit 25 and 26 are the interim

18

settlement documents.

19

BY MR. REINERT:

20 21 22

Q

Let's turn to after lunch on February 12

February 13, 2012. What occurred after lunch?


141

1

A

The BMWE and the BRS came in and gave us

2

the BMWE tentative frank deal of February 2 and

3

indicated that they were prepared to sign that deal

4

right there today.

5

And that that should be the basis of the

6

settlement.

7

Q

8

Is it 27?

10

And page 9 of that exhibit.

A

It is the BMWE offer that was handed to

us.

14 15

It looks like the freight settlement if the numbers are correct.

16

Q

And looking at --

17

A

Tentative at that point.

18

Q

Okay.

19

says:

20

Contributions.

21

"(a)

22

And what is

Joint Exhibit 27, Mr. Woodcock?

12 13

I would like to just call up for a

moment what is Joint Exhibit 27, I believe.

9

11

Okay.

Looking at the bottom of page 9, it

"Section 1 - Monthly Employee Cost-Sharing

Effective January 1, 2010 through

December 31, 2011, the employee monthly cost-sharing


142

1

contribution shall be $200.00"

2

Do you see that?

3

A

Yes.

4

Q

And if you look over to paragraph B up to

5

10, it also has a $200 number as a cap.

6

Do you see that?

7

A

Yes, sir.

8

Q

Was it your understanding on February 13,

9

2012 that the PRLBC was proposing that the freight

10

employee cost-sharing contribution of $200 should be

11

a term of their proposal to Amtrak?

12

A

Well, it was at that time.

13

Q

Yeah.

14

What happened at the -- we can go back to the PowerPoint.

17 18 19 20 21 22

We'll talk about it later in

a minute.

15 16

Okay.

What happened at the close of the discussions on February 12 and 13, 2012? A

We jointly agreed to approach the

Mediation Board to invoke mediation services. It was a joint request that was issued to seek the help of the Mediation Board in our dispute.


143

1

Q

And then did you, in fact, do that?

2

A

Yes, we did.

3

Q

When?

4

A

That was a joint application on March 13,

5 6

2012. Q

7 8 9 10 11 12 13 14

Let's turn to the next slide. When did you begin your mediation

sessions? A

We began our mediation sessions with

Mediator James Mackenzie on June 5 and 6, 2012. Q

And what happened at those mediation

sessions? A

We reviewed each other's positions with

the mediator present.

15

And then the information that had been

16

exchanged, we shared with the parties and the

17

mediator, Mackenzie.

18

And at that point, he indicated his desire

19

to try to drill down into that information and make

20

sure that we were trying to do as much interest

21

based bargaining as possible.

22

Q

And during the course of the session, was


144

1 2

there a discussion of the PRLBC healthcare proposal? A

3

Yes, there was. Again, it was an overview at the time with

4

the mediator.

5

got into it in later sessions.

6 7 8 9

Q

And then we, of course, subsequently

And when did you hear the number 177.54

with respect to a PRLBC proposal? A

It was during, I believe, that June

meeting.

10

And it was indicated that that 200 number

11

that we saw earlier would not apply to Amtrak.

12

we would be frozen at the 177 number that we had

13

from the prior round.

14

Q

Was there any explanation as to why the

15

$200 number that had been in the document they

16

showed you on February 13, 2012 was now 177.54?

17 18 19 20 21 22

A

That

In their mind, they deemed the 177 to be

the equivalent of the 200. Q

What was the outcome of those discussions

with the mediator in June and July? A

Well, as I said, he challenged the parties

and asked Amtrak to open its books more.


145

1

And we ultimately, in addition to sharing

2

information we had shared -- but ultimately it led

3

to a meeting with the PRLBC's labor economists, Tom

4

Roth, which, on July 31, we reviewed not only some

5

of the materials that we had handed out previously

6

on wages and health, but we had our Amtrak finance

7

people, Labor Relations people, and Aon Consulting

8

meet with the labor economist in Washington to

9

review all the information on those two areas.

10 11

Q

After the July 31 session, when was the

next meeting?

12

A

The next meeting was September 10.

13

Q

What occurred at the September 10 session?

14

A

Excuse me.

15

The next meeting was in November.

16

Q

Okay.

What happened in September?

17

A

But in September, the PRLBC had requested

18

a release from mediation less than six months and

19

three sessions later of mediation.

20 21

MR. REINERT:

For the Board's reference,

that's Joint Exhibit 40.

22


146

1

BY MR. REINERT:

2

Q

Amtrak respond to that?

3

A

Yes.

On October 10, we responded to it,

4

and we indicate that we remained willing and open to

5

negotiating a settlement.

6 7

MR. REINERT: BY MR. REINERT:

8 9

Q

Okay.

Let's talk about that November 16,

2012 mediation session.

10 11

And that's Joint Exhibit 41.

Can you just tell us what occurred at that session?

12

A

13

Yes. At that session, we provided updated

14

financial analysis of all our proposals including an

15

additional healthcare and wage package and gap

16

analysis, some of which we had been working to

17

provide in response to Mr. Mackensie's requests.

18 19

Q

from mediation?

20 21 22

What happened to the request for release

A

The NMB rejected the request on November

Q

Did the PRLBC or its members communicate

19.


147

1

to individual members again that you're aware of

2

during 2012?

3

A

We became aware of a communication dated

4

December 4, 2012, that the -- was sent to the

5

members of these unions.

6

MR. REINERT:

For the Board's information,

7

that's Amtrak Exhibit 253.

8

BY MR. REINERT:

9 10 11

Q

What was your understanding of what the

PRLBC was telling its members? A

12

Well, there were several things. First was that in their view the freight

13

deal was controlled.

14

was their view of prior PEBs that that was the case.

15

And that that is what they were telling their

16

members.

17

That that was absolute.

It

The second thing was that, while they did

18

not feel the freight deal was a great deal, they

19

said it's better than the internal pattern that

20

Amtrak had and was espousing.

21

And last but not least, they asked their

22

members for assistance essentially in pressing the


148

1

Amtrak management and government officials for

2

release so that they could move to the next stage.

3 4

Q

When did the parties next meet in

mediation?

5

A

March 27, 2013.

6

Q

And what occurred in that session?

7

A

Again, we provided additional medical

8

benefits and work rule options, wage increases, a

9

series of information in a rather thick package that

10

not only updated all of prior exchanged information,

11

but, again, was a packet that frankly would have

12

enabled the parties right there to have continued to

13

work diligently towards getting a deal.

14 15 16

Q

Did the PRLBC continue to seek NMB

release? A

Yes.

17

They had actually sought out that pressure

18

on Amtrak and urged Amtrak to also request a release

19

at that time in the roughly May and June time frame.

20 21 22

Q

You make a reference in your PowerPoint to

June 2013, "PRLBC uses corporate campaign tactics." What are you referring to?


149

1

A

2

Yes. There were a series of both written

3

documentations as well as picketing of our Amtrak

4

Board Chairman's office and also one of our other

5

board members during this general time frame.

6

MR. REINERT:

7

Exhibit 254?

8

BY MR. REINERT:

Can we pull up Amtrak

9

Q

What is this?

10

A

This particular one is an entry in the

11

BMWE Penn Federation website that talks about the

12

picketing of Amtrak Board Chairman Anthony Coscia's

13

offices in New Jersey.

14 15

Q

Can you scroll up to the actual picket

sign, if you can?

16

Yeah.

It says:

"Anthony Coscia.

17

Chairman of the Amtrak Board of Directors.

18

Buster."

19

Union

Now, at the time that signs with union

20

buster were on it, what portion of Amtrak's

21

employees were under new collective bargaining

22

agreements?


150

1 2

A

percent, 72 percent.

3 4

We had I believe at that time, around 70

I would have to look at the chart for a moment.

5

Q

At that point, you would have --

6

A

That's right.

7 8 9 10

We would have had 84 percent at that point with the UTU deal having come in. Q

And you made reference that there was

another board member who was picketed?

11

A

Yes, Board member Bert DiClemente.

12

Q

And where was he picketed?

13

A

At his house.

14

Q

When was the next NMB mediation session --

15 16 17

we can go back to the PowerPoint -- scheduled? A

National -- excuse me, on June 7.

18 19

There was one scheduled for June 7 in the

They canceled a two-day session that was scheduled for the 11th and 12th of June.

20

Q

When did the next sessions occur?

21

A

The next sessions were July 16 and 17.

22

Q

Of 2013?


151

1

A

2013.

2

Q

And who was present?

3

A

Present at that was the Chair, Linda

4

Puchala, Director of Mediation, Larry Gibbons, and

5

Mediator for our case, James Mackenzie.

6

Q

And what occurred during those sessions?

7

A

Well, we submitted a comprehensive set of

8

materials, again, all updated to facilitate trying

9

to reach an agreement.

10 11

And among other things, there was no interest in essentially reaching a deal.

12

In fact, we were somewhat surprised during

13

that time that it was indicated that the PRLBC had

14

not granted the authority to their labor economist

15

to look at work rules.

16

Q

How did that come about?

17

A

That came about in response to the second

18

day when we put on the table of -- an actual example

19

of what could occur with providing additional wages

20

in return for, in this case, healthcare changes that

21

would provide additional income to this particular

22

bargaining units.


152

1

MR. REINERT:

And just for the Board's

2

reference, I think the document Mr. Woodcock was

3

referring to is Joint Exhibit 49 and Joint Exhibit

4

54.

5

BY MR. REINERT:

6

Q

In the discussions on July 16 and 17,

7

2013, was there any discussion of the UTU conductor

8

deal?

9

A

Not that I remember, no.

No.

10

Q

Prior to the discussion about work rules

11

and no authority to examine, had you been under the

12

impression that there was going to be a discussion

13

about the costing out of work rules?

14 15

A

Yes. Not only had we discussed that and offered

16

on various occasions to make that on the same plane

17

as wages and healthcare, which was jointly reviewed,

18

but also in the prior communication I referred to by

19

the BMWE and their members in December of 2010.

20

They indicated that their consultant was

21

indeed looking at our various work rule assumptions

22

and our proposals that were made on costing and


153

1

value.

2

Q

Did Amtrak ever receive an economic

3

analysis of its work rule suggestions from the

4

PRLBC?

5

A

No.

6

Q

Let's turn to the July 17, 2013 proposal.

7 8 9

No.

Can you just walk us through the proposal that Amtrak put on the table that day? A

The proposal built on our June 2010

10

proposal that we had made a comprehensive proposal

11

but it went further.

12

It provided for an additional 1 percent on

13

January 1, 2014, on top of the Amtrak proposal, in

14

return for adopting certain plan design changes from

15

the BMWE freight package, which the BMWE and BRS

16

indicated they would be willing to accept.

17

Q

18

rules?

19

A

20 21 22

And what did it do with respect to work

It didn't add any additional work rules,

but we had our baseline package still on the table. Q

And did the PRLBC respond to that

proposal?


154

1

A

Yes.

2

Q

Did they make a counterproposal?

3

A

No.

4

Q

Did they suggest areas where they could

5

It was rejected.

make a counterproposal?

6

A

No.

7

Q

On July 16 and 17, did Amtrak raise other

8

possibilities that could be utilized to fund more in

9

terms of general wage increases?

10

A

Yes.

11

In our package, we offered some other

12

areas, particularly in the healthcare area that

13

would generate some significant cost savings to the

14

Company that could be passed on in general wage

15

increases.

16

Q

And for example, what areas?

17

A

Consumer driven health plan options.

18

We had some additional options there that

19

we provide compared to others from previous

20

discussions.

21 22

Q

What about the work rules areas? Did Amtrak identify areas within work


155

1

rules that could generate savings for general wage

2

increases?

3

A

We continued to want to talk about them,

4

but we did not offer additional increases -- excuse

5

me, additional options.

6

We talked conceptually around what we

7

would call compressed work weeks, which were maybe

8

3-by-12 days of work.

9

that if the BMWE and the BRS felt that that was an

But we would only work on

10

area they could work with us on since it would

11

require an extensive amount of modeling by our

12

engineering department how and where they could use

13

it and its value to the Company and the June.

14

Q

In the materials that Amtrak provided the

15

PRLBC on July 16 and 17, 2013, did it show specific

16

dollar amounts associated with these --

17

A

Yes.

18

Q

-- work rule changes?

19

MR. WILDER:

Excuse me.

Since the

20

question wasn't finished, I'm not sure what the

21

answer was.

22

MR. REINERT:

Okay.

I'll rephrase.


156

1 2

BY MR. REINERT: Q

Did Amtrak identify specific dollar

3

savings related to the suggested work rule changes

4

in the Amtrak materials?

5

A

Yes, we did.

6

Q

And did the PRLBC say those costings were

7

inaccurate?

8

A

No.

9

Q

Did they provide any alternative

10

documents?

11

A

No.

12

Q

Okay.

Let's turn to your view overall,

13

your perspective as Amtrak's lead negotiator, what

14

the parties did in this round that got us here

15

today.

16

A

Well, as I talked about earlier building

17

on our lessons from 242, we believe we have applied

18

them here and tried to further these negotiations

19

and reach deals as we did with the rest of our

20

bargaining units in this round.

21 22

So among other things, was bargain early for reasonable deals; do not delay.


157

1

Our view is that just the opposite

2

occurred with the PRLBC, including roughly the year

3

and a half when a freight deal was being pursued

4

nationally.

5

Secondly, we pursued all deals, and we

6

negotiated openly with parties.

7

in some cases had unique issues, and we dealt with

8

them.

9

All of our unions

Again, so far the PRLBC, they have

10

insisted lock step on the freight deal, no other

11

exceptions are to be made.

12

We have been willing to negotiate with the

13

PRLBC as a coalition when we were initially

14

approached by them to do so.

15

The PRLBC, three of the bargaining units

16

left and are no longer here and have cut deals with

17

us to proceed in 2011.

18

We have set a pattern with 13

19

organizations.

20

join that pattern.

21 22

The PRLBC so far has declined to

We have presented options for higher wages, whether it be health, whether it be work


158

1

rules, any other options that could be provided.

2

Up to now, we have got no response.

And

3

in fact, cherry picking the freight deal on health

4

and welfare.

5

And last but not least, we have absolutely

6

had open books.

7

information on health.

8

review items both with their economist and at the

9

table.

10

We have shared volumes of We have had our consultants

Our finance department has done the same,

our engineering group.

11

And, again, we have met no response on

12

either alternatives or where our costs or our

13

assumptions could be improved, essentially no

14

bargaining back and forth.

15 16 17

Q

What points do you want to leave the Board

with from your testimony? A

Well, when you step back and you look at

18

this round today, I think the first is we have a

19

well-established pattern, 13 of 15 unions have

20

settled along the lines that I have discussed

21

earlier in the presentation.

22

It's clear the PRLBC at some point decided


159

1

to delay reaching settlement with us, instead,

2

publicly espousing waiting for the freight pattern

3

in their mind to settle.

4

We believe this Board should award the

5

Amtrak pattern.

6

done with our other unions, and we think it is the

7

appropriate action for this Board given that 84

8

percent of our workers are covered under these same

9

type deals.

10

It is consistent with what we have

However, we believe there is ample

11

opportunity, if the Board wants an alternative, that

12

there are plenty of opportunities for offsets to

13

provide greater GWIs, greater income to these

14

bargaining units here, but it would be offset with

15

health and welfare and work rules.

16

Again, we remain receptive to that as we

17

have throughout the bargaining round.

18

forward to keep working with the Board in that

19

regard.

20 21 22

MR. REINERT:

And we look

I have no further questions

of Mr. Woodcock. MR. WILDER:

May I have 15 minutes?


160

1

ARBITRATOR JAFFE:

Not a problem at all.

2

We'll stand in adjournment.

3

(A recess was taken.)

4

CROSS-EXAMINATION

5

BY MR. WILDER:

6

Q

Good afternoon, Mr. Woodcock.

7

A

Good afternoon.

8

Q

On page 13 of your PowerPoint

9 10

presentation, you refer to an emergency room co-pay increase from $50 to 75.

11

Is that correct?

12

A

Yes, sir.

13

Q

And that issue has never been in dispute

14 15

between Amtrak and the PRLBC, has it? A

I'm not sure that it has been because I

16

think it's the same $75 on the freights, but we have

17

never fully discussed it.

18 19 20

But I think that's fair to say. Q

Throughout the dispute, it has been

narrowed to that extent?

21

A

Yes, sir.

22

Q

All right.


161

1

A

If not more.

2

Q

Now, below that reference to the emergency

3

room on page 13 of your PowerPoint statement, there

4

is a reference to the so-called internal pattern

5

employee healthcare contributions.

6

Is that correct?

7

A

Yes.

8

Q

Now, the reference to 190 per month

9

beginning on July 1, 2011, actual 181.62, does the

10

190 figure refer to the cap and the 118.62 refer to

11

the 15 percent?

12

A

13 14

That is correct. The 190 is the cap.

Q

Now, at the time the current agreement

15

between the Amtrak and the BMWED and the BRS became

16

amendable, what was the employee healthcare

17

contribution monthly amount?

18

A

I don't remember what that amount was, but

19

we had one more recalculation left under the prior

20

agreement and that was July 1 of 2010, which

21

produced the 177.54.

22

I don't remember what the previous one


162

1

was.

2

Q

I see.

3

A

We could look that up if that's something

4 5

you would like. Q

6

Thank you. So as of the amendable date or shortly

7

thereafter, the employee healthcare contribution at

8

Amtrak was 177.54; correct?

9

A

On July 1 of 2010.

10

Q

And that was part of the status quo, was

11

it not?

12

A

Yes, the previous round.

13

Q

Now, you testified concerning your

14

understanding of the healthcare contribution issue

15

under the most recently concluded freight agreement.

16

Do you remember that testimony?

17

A

Yes.

18

Q

And you made reference to a $200 monthly

19

healthcare contribution.

20

Is that correct?

21

A

Yes.

That's what's in the agreement.

22

Q

Now, to your knowledge -- withdrawn.


163

1

To your understanding, Mr. Woodcock, was

2

that $200 figure the figure that employees covered

3

by the freight agreement would be obliged to

4

contribute on a monthly basis at the amendable date?

5

A

That, I don't know.

6

Q

Ah.

Do you know what the monthly

7

healthcare contribution was on the freights when the

8

previous agreement became amendable in 2009?

9

A

I do not know that.

10

Q

You don't know whether that was 200 or

11

less?

12

A

Or more, no, I don't know.

13

Q

All right.

14

Fine.

I'm going to move to page 15 in your

15

statement to the so-called administrative work rules

16

and ask that Amtrak Exhibit 248 be placed on the

17

board, please.

18 19

MR. WILDER: board?

20 21 22

Can anybody read 248 on the

I can't even read it in front of me. BY MR. WILDER: Q

I'm going to ask you to turn to page 4 of


164

1

Amtrak 248.

2

Drawing your attention to the block

3

running from left to right at the bottom of that

4

page pertaining to TCU.

5

I'll ask whether the seniority entry,

6

restrictions on exercise of seniority part-time to

7

full-time and in/out of RSO with a one-year lock in.

8 9 10

My understanding from the agreement entered into between Amtrak and the TCU is that that provision is contained in a side letter?

11

A

Yes, sir.

12

Q

All right.

Now, the side letter bears the

13

date of the original agreement to which it is a side

14

letter?

15

A

I would have to see it to verify that.

16

Q

All right.

My question is whether you

17

remember, of your own knowledge, when that side

18

letter was concluded with the TCU?

19

A

20 21 22

No, I don't remember. But all our discussions were part of that

round that we concluded our Master Agreement with. Q

What are RSOs?


165

1

A

Reservation Sales Offices.

2

Q

All right.

3 4

And how many reservation sales

agents does Amtrak employ? A

5

I believe the number is around 1,000. They're mostly agents.

6

Q

Are these telephone agents?

7

A

They handle a variety of transactions,

8

telephone being one of them.

9 10 11

But also now, their duties have expanded as technology and work has changed. Q

You testified during your direct

12

examination, Mr. Woodcock, that, after you received

13

responsibility for this round of negotiations, you

14

met with Mr. Boardman.

15

Do you remember that testimony?

16

A

Yes, sir.

17

Q

Was it at that meeting that Mr. Boardman

18

communicated to you his desire to enter promptly

19

into negotiations and conclude agreements if

20

possible?

21

A

Yes, it was.

22

Q

So that decision was made in January of


166

1

2010.

2 3

Is that correct? A

Well, it was contemporaneous with my

4

assuming the leadership role, but, yes, it was in

5

January 2010 we began our strategy and discussions.

6

Q

Did you begin meeting with the six

7

organizations that settled -- I'm sorry, not six,

8

eight organizations that settled by October 2010 and

9

in January of 2010.

10 11

A

meetings took place without consulting those files.

12 13

I'm not sure when the first discussions or

I wouldn't know. Q

I would be guessing.

Did Amtrak make the initial proposal for

14

the agreements that were entered into with those

15

eight organizations in 2010?

16

A

I'm not sure of the nature of your

17

question, but when we had our first discussions,

18

they were very broad.

19

And at that point, Amtrak formulated

20

proposals based on some of those early discussions

21

with certain of the unions.

22

There was nothing initially, but they were


167

1

more broad discussions about whether the unions

2

would be interested in entering deals along certain

3

parameters.

4

we formed a proposal at that point.

5 6

Q

And there was give and take, and then

I'm going to call your attention, again,

to Amtrak Exhibit 248, and that is on the page 1.

7

Did Amtrak seek work rule changes from the

8

ASWC, the Amtrak Service Workers Council, other than

9

what is set forth in Amtrak 248?

10 11

A

things that we had put on the table at that time.

12 13

I'm not sure.

16

I would have to consult the

file to determine if those talks evolved.

14 15

I don't recall whether there were other

My guess is it was very little there that we had. Q

Now, other than the changes described on

17

Amtrak Exhibit 248, did Amtrak request rules changes

18

from any of the other organizations listed on that

19

exhibit?

20

A

Again, without looking at the files to

21

know what we might have put on the table and

22

discussed with all the unions, I wouldn't be able to


168

1

accurately answer that.

2

I do know that some of the unions that I

3

talked about like ARASA-MW, FOP, we sought little

4

of -- the dining car steward, we sought very little.

5

Q

Was there a decision made by Amtrak not to

6

seek extensive rules changes from the organizations

7

in this bargaining round?

8

A

9

Yes. Within the parameters I described

10

initially, and that was one of the lessons learned,

11

I think, from 242.

12 13 14

Q

Can you share with us the rationale or the

reason for that corporate decision? A

The decision was really based on how can

15

we reach agreements amicably and obviously jointly

16

with labor.

17

And what were the items that we would be

18

discussing with each union.

19

unions had items they wanted us to discuss.

20

And in some cases the

But it was really part of the

21

collaborative collective bargaining process, but

22

certainly there were many work rules that we could


169

1

have put on the table with all of our crafts that

2

probably would have been too difficult for the

3

parties to overall lift.

4

Q

In your role as the leader of this round

5

of negotiations for Amtrak, did you solicit the

6

Amtrak operating departments on whether work rule

7

changes were required?

8

A

Yes, we did.

9

Q

Did you receive an affirmative or negative

10 11

response from the operating departments? A

Not -- no, I think every operating group

12

we talked to and was at the table with us had some

13

issues.

14

Again, many of them were along the lines

15

of these administrative issues that we put on the

16

table.

17

present at all our negotiations.

18

Q

But I believe the operating people were

I see.

Were you present in the previous

19

round of bargaining between Amtrak and its labor

20

organizations?

21 22

A

I would say many of the meetings, but I

don't know that I was at all of the tables in the


170

1

previous round.

2

I have my own crafts that I was primarily

3

responsible for, and I was at some towards the end.

4

Q

And you did testify, I believe, in this

5

proceeding that a certain number of those

6

organizations had reached agreement with Amtrak

7

prior to the decision of Presidential Emergency

8

Board 242.

9

Is that correct?

10

A

Yes, sir.

11

Q

Did Amtrak sign me-too provisions with

12 13

those organizations? A

I don't believe that we did without

14

looking back at those agreements.

15

I don't believe we did.

16

Q

During your direct examination, you

17

testified that in February of 2011, you were

18

approached by the sheet metal workers.

19

A

I don't remember I said the date, but it

20

was early in 2011 that I was approached by the sheet

21

metal workers.

22

Q

Would it be accurate to say that the sheet


171

1

metal workers had a concern with jurisdictional

2

limitations within the mechanical department?

3

A

4

I don't recall that being an issue. Their issue was about their number, their

5

stability or their number in relation to other

6

crafts.

7 8 9 10

Q

All right.

Was the number of sheet metal

workers shrinking? A

I don't believe without looking at the

numbers, I don't think it had been shrinking.

11

But they desired to move away from a hard

12

number that could go up and down to a percentage of

13

the workforce mechanics.

14

Q

15 16

Is that correct? A

17 18 19 20 21 22

And they achieved that goal in this round.

At least to my knowledge, they did. I'm not sure they got everything they

wanted, but they did. Q

Were they the only organization that

wanted relief of this nature? A

We had been requested of it by the

boilermakers, but I think with a leadership change


172

1

we never got a change to advance that.

2

But they also, like the sheet metal

3

workers, have an equity number.

4

hard headcount number.

5

with us, and we told them that we would leave the

6

door open to continue those discussions, but we did

7

not reach it with anyone else.

8

Right now, it's a

And they were exploring ways

This is not our request.

9

Q

10

type of ...

11

A

Only one.

12

Q

Only one?

13

A

The boilermakers are where likely former

14 15 16 17 18 19 20 21 22

So there were two organizations with the

sheet metal workers were prior to this round. Q

Right.

But as to the -- what were the

other organizations? A

The boilermaker and the sheet metal

workers are the two. Q

And so you left the door open for the

boilermakers to seek the same kind of agreement? A

If they wanted to, they could come talk to

us, yes.


173

1

Q

2 3

I understand. I want to draw your attention to page 21

of your statement, Mr. Woodcock.

4

A

Yes.

5

Q

Entitled:

6 7 8 9

"UTU joins the Amtrak pattern."

Are conductors used in the cabs of Amtrak trains? A

Only in cases where we have no second

engineer, which is rare.

10

Our rules with our engineers require on

11

runs of six hours or more outside the Northeast

12

Corridor, that there be a second fully qualified

13

passenger engineer.

14 15

Q

fully qualified as an engineer.

16 17

And that -- so that conductor would be

Is that correct? A

18

No.

No.

They could only go up front to be a second

19

pair of eyes and call signals on the railroad as a

20

safety feature.

21 22

Q

How many conductors, fully qualified

conductors, are employed by Amtrak?


174

1

A

I'm not sure of what that number would be.

2

The craft number is over 2,000.

3

And at any given day right now in our

4

operation we have about 1,300 conductor assignments

5

yards, where crews work trains, transfer trains in,

6

revenue and passenger service.

7 8 9

Q

And are the remainder of that 2,000 plus

in the craft assistant conductors? A

I believe that would probably be the case

10

or trainees that are in training through the initial

11

training period and assistant conductors and then

12

conductors.

13

Q

14

based on Exhibit No. 204.

15 16 17 18

Now, I get 2,047 in the craft and class

Is that correct? A

I'm looking on it now, page 7, 2,047, you

said. Q

To that number, some 1,300 are conductors,

19

and we're forced to talk in general numbers at this

20

point.

21 22

Do you happen to know that of the assistant conductors, how many are conductor


175

1 2

qualified? A

3 4

No, I don't. Let me just make one correction.

1,300 is

the number of positions any day.

5

There are vacancies at any given time due

6

to either manpower issues or qualifications,

7

qualifying certification, et cetera.

8

But on any given day, we need 1,300

9

conductors.

10

Q

11

Let me ask that last question I asked in a

better way, I hope.

12

Is there a number of assistant conductors

13

who are conductor qualified but choose to remain

14

assistant conductors?

15

A

16

Yes. I don't know what that number is, but

17

there are people who prefer to work as assistant

18

conductors.

19

Q

Is that number significant?

20

A

I would have to determine what it is or

21

what it was at the time we negotiated the rule, but

22

it is -- it is significant.


176

1

Q

2 3

Okay. MR. WILDER:

Could I ask counsel that that

number could be supplied?

4

MR. REINERT:

5

MR. WILDER:

6 7 8 9

Certainly. Thank you.

BY MR. WILDER: Q

Now are all of your conductors certified

under Part 242 of the FRA regulations? A

All conductors as of this time, either

10

through grandfathered status, which is allowed under

11

the regulations, or having gone through

12

recertification class, all our conductors that are

13

operating as conductors are qualified.

14

Q

All right.

And so all of the conductors

15

you just described are eligible for the $250 annual

16

allowance.

17

A

Provided they meet all the conditions in

18

that rule, which, in addition to the certification,

19

is physical characteristics and qualifications among

20

other things.

21 22

It's in the rule that we negotiated. Q

Fine.

And the certifications remain in


177

1 2

effect for 36 months? A

3

I believe that's correct. But I'm not sure about the federal regs on

4

the timing.

5

Q

6 7

many conductors were seeking the annual $250 bonus? A

8 9 10

Do you happen to know, Mr. Woodcock, how

Not at this time. The first payment isn't until -- of the

250, until March of 2014. Q

Now, of the conductors who are presently

11

fully qualified, do you happen to know how many are

12

eligible for the $500 bi-annual performance bonus?

13

A

No, I don't because that -- the first of

14

the $500 performance bonuses, as I remember, isn't

15

payable until September.

16

There's a chart in the back of the rule,

17

and you have to fulfill the service and proficiency

18

requirements that are written up in the rule.

19 20

And by the way, hold a conductor period -a conductor position for the whole time.

21

So you have a position feature, which is

22

you have to be a conductor for the whole six-month


178

1

measurement period.

2

amount of service, and you have to fulfill any

3

proficiency checks that are performed.

4

Q

You have to fulfill a certain

When you negotiated this provision with

5

the UTU, had Amtrak made an estimate of how many

6

conductors would be eligible for that payment in

7

costing the provision?

8 9

A

here with me.

10 11

MR. WILDER:

MR. REINERT:

16

We'll see in what format it

exists if it does.

14 15

Let me, again, ask counsel if

that information could be supplied?

12 13

I believe we did, but I don't have that

MR. WILDER:

Thank you.

BY MR. WILDER: Q

Now, while we're talking about conductors,

17

there is a rule followed uniformly in the freight

18

industry that when a conductor becomes seniority

19

eligible to upgrade to engineer, that conductor must

20

be promoted.

21 22

In other words, he must qualify for promotion or he must leave service of the railroad.


179

1 2 3

Is that rule in effect at Amtrak? A

No.

directly with the locomotive engineers.

4

The only promotion rule is within the

5

craft.

6

conductor.

7

We don't have any such connection

Q

You must be promoted within a year to

I'm going to ask a series of questions

8

relative to assistant conductors.

Before the UTU

9

agreement was entered into in April of 2013, was

10

there any requirement that assistant conductors

11

upgrade to conductor?

12 13

A

Not after the initial promotion except, of

course, for those that we might have taken over.

14

But the promotion rule did require that

15

you took the initial promotion step, but then you

16

could step back down and either not retain your

17

physical characteristics or your overall

18

qualification and now federal certificate.

19

Q

So that, before the UTU agreement,

20

assistant conductors who were required to stand for

21

examination and be promoted to conductor within a

22

certain period of time from hire.


180

1 2

Is that correct? A

That would be for the people that were

3

coming up as trainees and then going from trainee to

4

assistant conductor; the former rule read within six

5

months, you had to stand for promotion and get

6

promoted.

7

back.

8 9 10 11 12

Q

But it didn't prevent you from going

All right.

Now, how did the UTU agreement

change the rule that you just described? A

Well, first of all, with the federal

certification, that applies just to the conductors. What we did is we not only said that the

13

assistant conductors coming out -- and I think this

14

is in the first part of the rule -- that the

15

assistant conductors standing for that promotion

16

within one year, not only do they have to maintain

17

and pass the -- all the training that's in that

18

rule -- I believe it's the first paragraph -- in

19

order to be eligible for the 250; but also, as a

20

condition of their employment, from now on, you have

21

to keep that series of qualifications up so that if

22

we need to use you, we'll be able to use you, excuse


181

1

me, as a conductor.

2 3

MR. WILDER: 245 on the screen?

4 5

THE WITNESS:

Would I be able to get a

copy of that from somebody?

6 7

Could we place Amtrak exhibit

My eyesight is probably -- thank you, sir. BY MR. WILDER:

8

Q

Could you turn to?

9

A

May I ask a question?

10 11

This is unsigned, do you know if this is the same as the signed one.

I don't --

12

MR. WILDER:

13

I believe it is but --

14

MR. REINERT:

15

All right.

We're going to get him the

exhibit book.

16

MR. WILDER:

17

I didn't notice that that wasn't signed.

18

THE WITNESS:

19 20 21 22

That fine.

Which exhibit number?

BY MR. WILDER: Q

245.

Excuse me.

Now, I'm referring to page 5, Mr. Woodcock, Section 2 of Article 3 which purports


182

1

to amend Rule 7 dealing with promotion?

2

A

Yes.

3

Q

Now, will these changes that we're looking

4

at now to Rule 7 be applicable -- to whom would they

5

be applicable within the assistant conductor ranks?

6 7

A question.

8 9 10

I'm not sure of the nature of your

They're applicable to the craft except those who have not yet taken and worked their way through promotion in less than a year.

11

There is a small group of employees that

12

are being -- on their way to being retired within

13

the next two to three years that we have waived

14

forcing them into the certification because of the

15

36 months.

16

Q

I see.

With the exception of that group

17

of prospective retirees, is Section 2 applicable to

18

everyone else in the craft?

19

A

Yes.

20

Q

Now, confirm the use of electronic

21 22

examinations. This implies to me that electronic


183

1 2

examinations were already in use at Amtrak. A

3

Yes. I believe that was confirming an

4

arbitration decision that we had.

5

confirming an arbitration decision we had where we

6

were using the exams in electronic form.

7

Q

That was

Now, include physical characteristics

8

qualifications, this involved hearing test, eye

9

tests, color blindness?

10

A

11

No. That would be the medical or what I would

12

call the employee medical requirements, particularly

13

vision acuity, which is covered under the

14

regulations.

15

This here is what we call the knowledge of

16

the railroad which is certain switches, certain

17

stations, physical characteristics of the territory

18

over which the conductor in charge of the train is

19

operating.

20 21 22

Q

Are you referring to territorial

qualification requirements? A

I believe that's essentially the most of


184

1

what that involves.

2 3

I'm not familiar with the complete regimen but that would be part of it, yes.

4 5

Q

Conductors have always had to meet that

requirement, haven't they?

6

A

Yes, sir.

But not as part of setting up

7

this rule for what they have to do to attain the

8

$250.

9

Q

Well, are the provisions that we're

10

looking at now in Section 2 amending Rule 7,

11

independent of the 250 and the performance bonus.

12

In other words, are these requirements

13

that would apply regardless of any monetary

14

compensation?

15

A

They would apply if you were the conductor

16

prior, but what this says now is that, if you desire

17

to retain even the 250, you must maintain all of

18

these elements in here.

19

Q

Were the bullet-pointed entries that we're

20

looking at in Section 2 Rule 7 already part of Rule

21

7?

22

A

No.

Except where you see that we were


185

1

amending, for example, the four to six months and

2

the six months to after a year.

3

But basically, without looking at the

4

prior rule, my memory is that these were considered

5

new elements in order to set up the $250, and then

6

also the $500 to give us a fully qualified

7

workforce.

8 9

Q

Were assistant conductors promoted to

conductor required to take an examination prior to

10

Amtrak 245 being entered into by the Company and

11

UTU?

12

A

My understanding is they did.

13

Q

Did the agreement that we're looking at

14 15

change those examinations in any way? A

I don't believe it did other than

16

codifying the electronic feature, and of course, now

17

you have additional elements with 242 that had been

18

folded into our training an examination process.

19

Q

Now, Bullet Point No. 4 amended the

20

minimum required assistant passenger conductor

21

service prior to promotion from four to six months.

22

Is that correct?


186

1

A

Yes.

2

Q

And the purpose of doing that was what?

3

A

Was to allow an additional time for

4

seasoning and on the road experience before the

5

conductor could put in for an early attempt at

6

promotion.

7

Q

And I take it that was the same object of

8

the next bullet point to amend the promotion

9

requirement from after six months to after one year?

10

A

11

It's kind of the other side of the coin. This is when you must attain the

12

promotion.

13

to allow that seasoning and on-the-job

14

familiarization and training.

15

Q

16

So it did lengthen the time there also

Okay.

Let me try and understand.

Before this agreement was entered into,

17

did the assistant conductor have to stand for

18

promotion after six months?

19

A

Yes.

20

Q

Do I understand correctly that the next

21

provision add the following new section to the rule,

22

and small A, and bullet point small B, and bullet


187

1

point small C, and bullet points, refers to what we

2

have just read when it says successful completion of

3

all necessary training and examination?

4 5 6

A

Yes, as well as the items that followed,

Q

Now, in your testimony, Mr. Woodcock, on

yes.

7

page 21, you indicate that the UTU conductor

8

promotion rule is not automatic.

9

attainments and performance requirements.

10

There are

But I then understood you to say that the

11

assistant conductor had to stand for promotion after

12

one year.

13

Is that correct?

14

A

That is correct.

15

Q

All right.

And if the assistant conductor

16

does not stand for promotion or qualify for

17

promotion after one year, is that assistant

18

conductor terminated?

19

A

Yes.

20

Q

So the reference to "not automatic" refers

21 22

to what? A

To the performance bonus.


188

1

Q

2

I see. Now, if the assistant conductor qualifies

3

for promotion and he works as a conductor, let's

4

say, for one year, can he bid back to the assistant

5

conductor position?

6

A

Without looking at the seniority rules, I

7

believe there is no reason the employee cannot bid

8

back.

9

Q

He cannot bid back?

10

A

I believe there's no reason that they

11

cannot, but they have to maintain their

12

qualifications.

13

Q

14

I understand.

Fine.

So how this agreement changed things is

15

that an assistant conductor, having qualified to be

16

a conductor, must maintain the qualification.

17

A

18 19 20 21 22

Yes, as a condition of employment. That is in this rule.

Q

But that conductor can bid and be employed

as an assistant conductor; correct? A

That is correct.

But they wouldn't be

eligible for the two bonuses.


189

1

Q

Right.

Can the conductor qualify -- the

2

assistant conductor be assigned by the railroad to a

3

conductor position?

4

A

Yes.

5

Q

Now, is that a new rule or an old rule?

6

A

No.

7

That is utilizing the existing rules.

But now, with employees that are both

8

qualified, their physical characteristics, they have

9

taken a qualifying run, and they are certified, that

10

allows us to utilize those employees when we need

11

them.

12

Q

Is there any estimate by the record,

13

Mr. Woodcock, of the extent to which the pool has

14

been enlarged or will be enlarged as a result of

15

application of the UTU agreement in Company Exhibit

16

245?

17

A

I believe the operating member of our team

18

in the operations group in crew management did some

19

estimates of what they thought this could do to help

20

their operation and improve the efficiency, yes.

21 22

I don't have them with me. Q

Did they share those estimates with you?


190

1

A

At the bargaining table, yes, to make sure

2

that we were obtaining relief that we thought was

3

helpful and favorable to us.

4 5

MR. WILDER:

that information can be made available.

6 7

MR. REINERT:

10

Subject to identifying and

finding it, yes.

8 9

Again, I'll ask counsel that

MR. WILDER:

Thank you.

BY MR. WILDER: Q

On page 22 of your testimony,

11

Mr. Woodcock, under the bullet point referring to

12

the $250 annual bonus, you said and I quote, this

13

pool change:

14

offsetting the expense."

15 16 17

"Results in quantifiable savings

Did Amtrak, in fact, attempt to quantify the savings? A

18

Yes. As I indicated a minute ago, our operating

19

people did take a look at this and figured this was

20

a rule that would provide a great benefit to us.

21 22

And I mean, the operation. Q

Can you remember whether or not the


191

1 2 3 4 5 6 7

savings were actually quantified? A

operating people. Q

10

Is this the same information that we were

talking about before? A

I think it falls within your last question

about increased availability.

8 9

My recollection is that they were by the

And I think they did run numbers. Q

Did they translate those numbers into

dollars?

11

A

My recollection is that they did.

12

Q

All right.

13 14

MR. WILDER:

we're talking about as well.

15 16 17

My request would cover what

MR. REINERT:

I understand.

BY MR. WILDER: Q

Now, again on page 22, Mr. Woodcock, under

18

the bullet point referring to the $500 performance

19

incentive bonus, you have, Facilitates filling

20

Conductor vacancies and increases productivity

21

through the period.

22

I have left off availability because I


192

1

think you described that.

2 3 4

How does -- how does the performance incentive bonus increase productivity? A

Well, it increases productivity because

5

among other things, we will have less mark-offs.

6

Our people will be available more, we feel, through

7

this incentive and performance bonus.

8

Q

What is a mark-off?

9

A

A mark-off is in essence a book-off or an

10 11

absence. Q

Does Amtrak have absentee rules that

12

pertain to the conductor and assistant conductor

13

provisions?

14

A

15 16 17

all employees. Q

20

You may have covered this before, but I --

let me ask again.

18 19

We have an attendance policy applicable to

How does the performance incentive bonus reduce the need for additional staffing? A

Well, if we have more people because of

21

the bonus that are remaining in the conductor ranks

22

and more people that are retaining their


193

1

certification qualifications and physical

2

characteristics, even as ACs, we have less people we

3

need to train.

4

And, again, we're hoping to incentivize

5

people to take and fill all these jobs that will

6

eliminate the need for additional staffing that we

7

now have.

8 9 10

Q

Does a new hire in the conductor craft or

class at Amtrak have to be trained at the outset -withdrawn.

11

Does a new hire for the conductor craft or

12

class at Amtrak immediately enter training to become

13

a conductor?

14

A

I'm not sure, but I believe there's an

15

initial classroom training that's done before you

16

begin the hands-on training.

17

And then eventually within the year have

18

to attain a promotion to conductor, pass all the

19

exams.

20

Q

So would it be accurate to describe this

21

for the hiree as a continuous process during his

22

first year of employment?


194

1

A

2

I'm not sure. I'm not that familiar with the process

3

from when one is hired or transferred from another

4

craft to what's involved.

5

on what stages they go through.

That would be guesswork

6

Q

Does Amtrak hire qualified conductors?

7

A

Where we have them off of freight roads,

8

we have had them with engineers, and occasionally

9

we're able to get them.

10

But of course they may have to be

11

recertified under the Amtrak rules and regulations

12

and qualifications.

13

But I believe we have been able to get

14

them before the people that want to come work for

15

us.

16

Q

The last entry on page 22 of your

17

statement reads:

18

reduction in 3rd party crews/costs."

19 20 21 22

"Positive impact on safety and

Could you explain what the reduction in third party crews/costs is? A

Yes. What that is, when you get outside the


195

1

Northeast Corridor, in particular where we have

2

these very remote regions, for example, up along the

3

whole northwest of the country, Chicago to Seattle,

4

you'll have many outlying areas.

5

And there are oftentimes when a train will

6

get delayed or there will be a problem with the

7

train, and sometimes we need third-party crews

8

because the conductor, for example, will outlaw.

9

In this way, we feel we have the

10

opportunity now with assistant conductors being

11

qualified to take over that top job that we actually

12

can reduce sometimes the need for third-party crews

13

from the freights to bring the train in.

14

Q

Is this a large problem at Amtrak?

15

A

I don't know if it's a large problem, but

16

certainly at times where there is severe weather,

17

like right now, we have had crews that have to go

18

off the clock because of the hours, federal hours of

19

service law.

20

Q

Now, were any of these cost advantages

21

that you have mentioned in your testimony today

22

discussed during negotiations with the engineering


196

1

crafts?

2

MR. REINERT:

3

I'm not sure I understand what's being

4

Object to form.

referred to.

5

Maybe you can restate the question.

6

THE WITNESS:

7 8

Thank you.

BY MR. WILDER: Q

9

All right.

Let me clarify the question.

Today in your examination and in your

10

cross-examination, you have discussed the advantages

11

to Amtrak in entering into the agreement with the

12

UTU set forth in Amtrak Exhibit 245.

13

Is that correct?

14

A

Yes.

15

Q

My question is, During the negotiations

16

with the engineering crafts after April of 2013,

17

were the advantages to Amtrak of the UTU agreement

18

described to the engineering crafts?

19

A

20 21 22

No. I don't believe it was -- ever came up as

a topic of discussion. Q

Do you remember being asked about the UTU


197

1

agreement in June of 2013 and responding, We're not

2

going to discuss the UTU agreement?

3

A

4

No.

I don't remember that.

But I do remember during, I believe, our

5

meeting prior to the agreement finishing

6

ratification, I was asked about the deal.

7

maintained our silence as I indicated we were

8

required to by the UTU while it was out for

9

ratification.

10 11 12

And I

But I don't think I remember it ever coming up after that. Q

So do I understand you correctly to have

13

said that you're unwilling to discuss the Amtrak

14

agreement with the UTU while that agreement was

15

pending ratification by the organization?

16

A

17

Yes. That was the understanding we had with the

18

UTU, as I do with most unions, that we don't talk

19

about agreements when they're out for ratification.

20

Q

To your knowledge, Mr. Woodcock, had

21

collective bargaining negotiations begun at any

22

previous round, that is previous to this round,


198

1

prior to completion of the freight agreement?

2

A

Could you ask that again?

3

Q

All right.

My question is whether

4

collective bargaining negotiations between Amtrak

5

and the organizations representing its employees

6

begin in any round before this one prior to

7

completion of the freight agreement?

8 9

A

I don't recall.

There was one round where

we did reach a settlement, I believe, first before a

10

freight.

I think that was a 91 round and one

11

settlement.

12

Q

But otherwise, the parties at Amtrak and

13

its organizations waited until the freight agreement

14

was completed before commencing negotiations.

15 16 17

Is that correct? A

them or some of them came afterwards.

18 19 20

I believe that the agreements, many of

I don't know why the parties chose to do that. Q

Each round would have been different. Well, in light of that history, for the

21

PRLBC to wait for the freight agreement was not too

22

unusual, was it?


199

1

A

What I would consider unusual is that we

2

were not approached in that vein to find out if we

3

would be amenable to waiting.

4

But we never had those discussions.

We

5

weren't alerted to that.

6

discussions could not take place because witnesses

7

weren't available.

8 9

MR. WILDER:

I'm going to ask that Joint

Exhibit 15 be put up on the screen.

10 11

Just indicated that the

(A discussion was held off the record.) BY MR. WILDER:

12

Q

Do you have Joint Exhibit 15 before you?

13

A

Yes, sir.

14 15

MR. WILDER:

Mr. Chairman, will a computer

class be conducted by the Board after this session?

16

ARBITRATOR JAFFE:

17

THE WITNESS:

18 19 20 21 22

We're with you.

I'll join you, Roland.

BY MR. WILDER: Q

All right.

I'm going to ask you to turn

to Article III, Other Changes. Now, am I correct that this is the proposal that Amtrak made to the BMWED?


200

1

A

Yes.

2

Q

All right.

3

Drawing your attention to

Section 3, Training.

4

A

Correct.

5

Q

The effect of that entire rule change

6

would be to extend the period of assignment

7

following training from six months to one year.

8

Is that correct?

9

A

Correct.

10

Q

And in practical terms, what would that

11 12

accomplish for Amtrak? A

Well, the feeling at the time by the

13

operating people was that this would allow us to,

14

among other things, encompass a whole work season,

15

which would be much longer on Amtrak.

16

And it would be a retention, a greater

17

retention of those skills that we train a person for

18

from six months to one year.

19

Q

Is there something exceptional about the

20

period of assignment as that term appears in the

21

proposal?

22

A

No.

Other than the fact that we have had


201

1

a considerable difficulty in this craft with vacancy

2

issues.

3

And so our feeling was that this was an

4

attainable rule.

5

this issue that we were training people and then not

6

being able to use them on the jobs for which they

7

were trained.

8 9

Q

One to put on the table to address

As a practical matter, Mr. Woodcock, would

this permit the newly trained employee or the newly

10

qualified -- the employee which is newly qualified

11

for promotion to be assigned anywhere in the system?

12

A

I'm not sure what the assignment rules in

13

this particular craft provide for, but I would think

14

certainly consistent with that training agreement

15

whatever there is in the rules of agreement, we

16

would be able to assign them.

17

Q

Would it be accurate to say that this rule

18

goes to the core job security protections in the

19

BMWED agreement?

20

MR. REINERT:

21

ARBITRATOR JAFFE:

22

Object to form. I'm not sure I

understand the question either, Mr. Wilder, and I


202

1

apologize.

2

MR. WILDER:

3

ARBITRATOR JAFFE:

4 5 6

Let me ask it again. Thank you.

BY MR. WILDER: Q

Does the proposed rule affect job security

protections in the BMWED agreement?

7

MR. REINERT:

I'm going to object to form,

8

unless we specify what those job security

9

protections are that you're asking about.

10

ARBITRATOR JAFFE:

I would rather not

11

guess, so if you don't mind spelling it out it will

12

certainly help us.

13 14

MR. WILDER:

foundation that may help a bit on that.

15 16 17

Let me provide a bit of

ARBITRATOR JAFFE:

Thank you.

BY MR. WILDER: Q

Does the BMWED agreement contain

18

protections against being assigned beyond

19

geographical limitations?

20

A

I'm not sure without looking at the

21

agreement, but I don't see how that changes this or

22

vice versa.


203

1

Q

2 3

Let me withdraw the question on that. Let me call your attention to the previous

exhibit, which is the proposal to BRS.

4

And this is Exhibit -- Joint Exhibit 14.

5

A

I have it.

6

Q

Let me ask you to turn to page 5.

7

A

Yes, I have it.

8

Q

Section 3, dealing with assignment.

9 10 11

Are you familiar with the reasons for that desired change? A

12 13 14

Yes. At least as we originally described it

back in June and in subsequent sessions, yes. Q

15

Would this rule modify -- withdrawn. Does the current agreement between Amtrak

16

and BRS contain a provision that restricts the

17

assignment of employees more than 45 miles from the

18

employee's formal work location or farther from his

19

residence, with more than 60 normal highway route

20

miles -- 45 normal highway route miles from his

21

residence?

22

A

I believe -- yes, that's embodied in the


204

1

current rules.

2 3

Q

And do you know what the purpose of the

45-mile limitation is?

4

A

The 45, no, I do not.

5

Q

Do you know whether or not the 45-mile

6

limitation is a job security rule?

7

MR. REINERT:

8

ARBITRATOR JAFFE:

9

allow that.

I object to form, again. Test the witness.

I'll

That's fine.

10

He either views it that way or doesn't.

11

THE WITNESS:

12

BY MR. WILDER:

13 14

I'm not aware that it is.

Q

Do you recall what the BRS told you about

this proposal during negotiation?

15

A

No.

16

Q

Would you characterize the change in the

17

45-mile rule as an administrative change?

18

A

I would characterize it more as a

19

flexibility in filling some of our assignments on

20

the particular seniority districts.

21 22

This would help and be of assistance to us.


205

1

Q

And how would it be of assistance to you?

2

A

Well, for example, and we discussed this

3

during our sessions, take the New York division.

4

By having 60 miles, we could extend down

5

to Trenton from New York, so that would cover that

6

stretch.

7

And in this case of Philadelphia, the

8

Philadelphia district, the ability to go out 60

9

miles would encompass some of the Harrisburg line

10

that's now not there.

11 12 13 14 15 16 17

So it would allow us greater flexibility to have people fill jobs. Q

Are signalman given commuting expense by

the railroad? A

I don't know without looking at the rules

whether they are or aren't. Q

Is it still Amtrak's position today that

18

the BMWED and the BRS must concede those work rules

19

which we have just described in order to obtain the

20

what you have described as the Amtrak pattern

21

agreement?

22

A

Yes, I would.


206

1

Q

Would it be fair to say that from the end

2

of 2010 through today, that both Amtrak and the

3

PRLBC stuck to their guns in bargaining?

4

A

5 6

I don't see it that way, no. I don't think that is fair to say.

Q

Were you aware then at the end of 2010

7

that Amtrak and the PRLBC represented unions had a

8

serious disagreement over whether the contract in

9

this round would follow the Amtrak internal pattern

10

or whether it would follow the freight pattern?

11

MR. REINERT:

12

There was no freight pattern in the end of

13

Object to form.

2010.

14

ARBITRATOR JAFFE:

I think the question

15

can still be posed, even if whatever the freight

16

pattern was wasn't known at that time.

17

MR. REINERT:

He used the word "followed."

18

ARBITRATOR JAFFE:

19

THE WITNESS:

I think it's okay.

I am not aware of those

20

discussions that may have taken place.

21

BY MR. WILDER:

22

Q

Let me refer to page 32 of your statement.


207

1

Was it explained -- and I'm referring to

2

the quotation from the BMWED letter dated December

3

6, 2010:

4

reinforce any notion that Amtrak's contracts follow

5

an internal pattern is potentially very dangerous."

6

"We do think that action tending to

Was it explained to you during negotiation

7

why the PRLBC thought it dangerous to reinforce any

8

notion of an internal pattern?

9

A

No, not that I recall.

10

Q

Do you remember being told that breaking

11

the link between the freight and the Amtrak

12

bargaining could make the collective bargaining

13

process at Amtrak more vulnerable to political

14

pressure?

15

A

16 17

No, I don't recall that. I only recall that the freight deal was

the settlement that we should take.

18

MR. WILDER:

19

up Joint Exhibit 40.

20

BY MR. WILDER:

21 22

Q

I'm going to ask you to bring

Turn to the last page of that exhibit and

this --


208

1

A

Page 3, or the last one?

2

Q

Yes.

3

A

Page 4?

4

Q

Yes, the last page of Exhibit 45 (sic).

5

A

Yes.

6

Q

And were you copied on this document?

7

A

Yes.

8

Q

Move up to page 3.

9 10

The last one.

The next to last complete paragraph beginning after, this extended.

11

Do you see the second sentence:

"The

12

PRLBC cannot and will not dissolve the linkage

13

between the wages and benefits of the freight

14

industry and Amtrak, especially considering the GOP

15

platform's commitment to withdraw public funding

16

from the carrier."

17

Do you see that?

18

A

I see that.

19

Q

Do you remember reading that?

20

A

Not off the top of my head.

21 22

You know, back then I might have, but it was never discussed.


209

1

Q

But you did receive the letter, did you

3

A

Yes.

4

Q

Early in negotiations, Mr. Woodcock, in

2

not?

5

2010 or perhaps early in 2011, was there a

6

discussion at the bargaining table between Amtrak's

7

representatives and those at the PRLBC about using

8

the commuter rails as a basis for coming up with an

9

agreement at Amtrak?

10

MR. REINERT:

I'm going to object to the

11

form of the question because it referred to

12

discussions between the parties at the bargaining

13

table during 2011.

14

There were none.

15

ARBITRATOR JAFFE:

16 17

Actually, the question

is a little ambiguous. It was certainly some in '10, and there

18

were discussions at least with respect to some

19

former members that ultimately led to deals; right?

20

So I'm happy to let Mr. Wilder pose

21

whatever question he want's.

But it's a little

22

unclear as to precisely what he's asking about.


210

1 2

MR. WILDER:

I'm not sure I need 2011 in

there.

3

ARBITRATOR JAFFE:

4

MR. WILDER:

5

ARBITRATOR JAFFE:

6

MR. WILDER:

That's good.

I do think -That works too.

-- think there were

7

discussions in January of 2011, but I will withdraw

8

that part of the question.

9 10 11 12 13

ARBITRATOR JAFFE:

Fair enough.

BY MR. WILDER: Q

But do you recall discussions about wage

settlements at the commuter rail carriers? A

I do recall them right at the early part

14

of our negotiations, and I believe there was

15

something in your Section 6 about that.

16

Q

Has Amtrak ever regarded the commuter rail

17

agreements as a template for its own negotiations

18

with its unions?

19

A

Not that I'm aware of in our history, no.

20

Q

Referring to page 43 of your statement,

21

and I'm referring the July 17, 2013 collective

22

bargaining meeting.


211

1

Before that meeting, had Amtrak made an

2

explicit wage proposal or wage increase beyond the

3

so-called Amtrak pattern to the PRLBC?

4

A

I don't believe we had put any additional

5

elements on the table, but we had talked about it

6

extensively.

7

Q

And that was in the context of developing

8

work rule concessions that would tend to bridge the

9

gap between the Amtrak internal pattern settlements

10

and some unspecified higher point in wages.

11 12

Is that correct? A

Well, work rules of the types that we had

13

put on the table as well as healthcare and any

14

others that PRLBC might have desired to put out

15

there.

16

Q

Was it at the July 17 session that the

17

idea of interest arbitrating our dispute was put

18

forward?

19

A

I believe that is correct, as we were

20

approached by the chair -- Chairperson Gillula on

21

that subject on the last day.

22

Q

That was the organization's idea, was it


212

1

not.

2

A

I believe it might have been, but I wasn't

3

present when it was being discussed with you behind

4

closed doors.

5

MR. WILDER:

One moment, Mr. Chairman.

6

ARBITRATOR JAFFE:

7

MR. WILDER:

Of course.

Let the record reflect that I

8

have completed my cross-examination at 2 minutes of

9

5.

10 11

ARBITRATOR JAFFE:

It most definitely

does.

12

Did you plan on any redirect?

13

MR. REINERT:

14

ARBITRATOR JAFFE:

15 16 17

Very brief. That's fine.

REDIRECT EXAMINATION BY MR. REINERT: Q

Mr. Woodcock, Mr. Wilder asked an

18

extensive number of questions about the UTU

19

Conductor Agreement, and particularly the promotion

20

rule and associated bonuses.

21 22

Do you recall that line of questioning? A

Yes, sir.


213

1

Q

And I think you have before you Amtrak

2

Exhibit 245, which was the language of the UTU

3

Conductor Agreement which shows it signed on April

4

17, 2013.

5

Is that correct?

6

A

Correct.

7

Q

Okay.

If you look at your timeline, up

8

there at April 17, 2013 is when that UTU agreements

9

were concluded.

10

So from April 17, 2013 on, did you receive

11

any written communication from the PRLBC asking for

12

an explanation of the UTU conductor performance

13

bonus and how it works?

14

A

No.

15

Q

Okay.

And I'm looking at the timeline,

16

and there was, in fact, a communication, a written

17

communication from the PRLBC to Amtrak on May 3,

18

2013, a couple of weeks after the UTU Conductor

19

Agreement.

20 21 22

Do you recall that? A

Yes, sir. MR. REINERT:

Could we call up that


214

1

exhibit?

2 3

I believe that's Joint Exhibit 47. BY MR. REINERT:

4

Q

Do you have that before you?

5

A

Yes, I do.

6

Q

And what is Joint Exhibit 47?

7

A

It is a letter to our Board chairman from

8

Jed Dodd and Dave Ingersoll, and among other things

9

it is asking that we -- Amtrak joins in asking the

10 11 12

Mediation Board to release us. Q

Is there any reference in that letter or

the attachments to the UTU Conductor Agreement?

13

A

No.

14

Q

And Joint Exhibit 47 is dated May 3, 2013;

15

correct?

16

A

Correct.

17

Q

Okay.

18

So then your next live meeting with

the PRLBC is the July 16 and 17 mediation sessions.

19

Is that right?

20

A

Correct.

21

Q

And I think you have already said, but

22

I'll ask you again, just to make sure, were there


215

1

any questions raised by the PRLBC during the July 16

2

and 17, 2013 mediation session concerning the

3

details of the UTU Conductor Agreement?

4

A

None that I recall.

5

Q

Is today in this hearing the first time

6

that Mr. Wilder or anyone from the PRLBC has asked

7

you questions about the April 17, 2013 UTU Conductor

8

Agreement?

9

A

Yes.

10

MR. REINERT:

11

MR. WILDER:

12

ARBITRATOR JAFFE:

13 14 15

18 19 20

I have one. Sure.

RECROSS-EXAMINATION BY MR. WILDER: Q

16 17

I have no further questions.

One question. As of July 16 and 17 of 2013 had the UTU

agreement been ratified? A

Yes.

It was ratified.

That is an actual date of signature, April 17, that was -- that was an actual signing.

21

MR. WILDER:

Nothing further.

22

ARBITRATOR JAFFE:

I assume no further


216

1

direct?

2

MR. REINERT:

3

ARBITRATOR JAFFE:

4

Anything from you folks

at this point?

5 6

No further direct.

We have got just a few.

We'll try to keep

them as brief as we can, Mr. Woodcock.

7

With respect to the UTU performance

8

bonuses that you have testified about at some

9

length, could we go back to Exhibit 245, if that's

10

possible.

11

Thank you.

12

With respect to the $250 annual payment,

13

it looks like that requires as one of the conditions

14

that the individual perform services as a passenger

15

conductor at least once in each calendar year.

16

THE WITNESS:

That is correct.

17

ARBITRATOR JAFFE:

Okay.

Should one

18

assume from that, that the vast majority of people

19

who otherwise qualify, meaning meet the other

20

conditions for the 250, will also meet it because it

21

only requires service once in the calendar year and

22

you have got the right to assign people as needed?


217

1

THE WITNESS:

No.

I think that the

2

purpose of this was that, again, if you decide and

3

you can hold a conductor position but you go down to

4

an assistant conductor, now you have to work at

5

least once to remain passenger conductor qualified.

6

And this was to frankly address concerns

7

that on occasion people would indicate they might

8

not be -- feel comfortable working a conductor's

9

position in the past, and so this is a requirement

10

that as part of that you have to actually mark up at

11

least once on a conductor position while retaining

12

all the other qualifications to get the 250.

13 14

ARBITRATOR JAFFE:

So I don't mean to be

confused, but let me back it up.

15

If I'm certified as a conductor, I bid

16

back into an assistant conductor's position, is

17

there any requirement in terms of Part 242

18

certification that I work at least once a year in a

19

conductor spot?

20 21 22

THE WITNESS: no.

To the best of my knowledge,

That's an Amtrak requirement in this rule. ARBITRATOR JAFFE:

That's fine.


218

1

And would Amtrak have the ability to

2

assign that qualified assistant conductor to work as

3

a conductor if you needed that service?

4

THE WITNESS:

Yes, that would --

5

ARBITRATOR JAFFE:

Okay.

So would you

6

normally assume that performing service at least

7

once in a calendar year is something that you had

8

hit for the vast majority of these people, or do you

9

expect this to be a significant disqualifier in

10 11 12

terms of the $250 annual payment? THE WITNESS:

I'm not sure if analysis was

done on that.

13

ARBITRATOR JAFFE:

14

THE WITNESS:

Okay.

It simply dealt -- felt it

15

had to be a requirement so that people did, for lack

16

of a better term, retain their field for the

17

position of ticketing and things like that, in

18

addition to their annual training.

19

ARBITRATOR JAFFE:

Okay.

For the

20

six-month performance bonus of $500, it looks like

21

one of the requirements is that they be compensated

22

as a passenger conductor on not less than 120 days


219

1

during the performance period.

2

Am I reading that correctly?

3

THE WITNESS:

4 5

Yes.

In addition to

actually holding a conductor position. ARBITRATOR JAFFE:

Right.

So does that

6

mean that someone has to actually work in the

7

conductor's job as a passenger conductor, or not,

8

for the 120 days?

9

THE WITNESS:

It means you have to

10

actually be assigned to and hold a conductor's

11

position and work the requisite service

12

requirements.

13

ARBITRATOR JAFFE:

Okay.

And do the

14

conductors work five days a week, eight hours a day,

15

or are the schedules varied and include other forms

16

of schedule?

17

THE WITNESS:

The schedules vary.

18

I mean, the Corridor is different than off

19

corridor where you have long runs and layovers.

20

the Corridor, you're generally home each night.

21 22

ARBITRATOR JAFFE:

In

The reason I was asking

is 120 days in six months is almost full-time five


220

1

days a week, isn't it, if you do the math?

2

THE WITNESS:

3

ARBITRATOR JAFFE:

4

THE WITNESS:

5

And there was much discussion about that,

6 7

It is -After vacation.

It is fairly aggressive.

the final number to rest on. ARBITRATOR JAFFE:

And I assume the data

8

that Mr. Reinert was going to look for and see what

9

form it's in and the like might show whatever the

10

projections were in terms of what actual payouts

11

would be projected to be for the employee group?

12

THE WITNESS:

I think that's the case.

13

Like I said, the operating people did take

14

a look at this and helped us develop a proposal at

15

the table, and I don't have that with me.

16

But again, we don't -- the first of the

17

payments isn't until March.

And then the first of

18

the performance bonus payments I believe in

19

September of this year.

20

ARBITRATOR JAFFE:

21

Was the intent from Amtrak's end to go

22

Right.

I understand.

ahead and have the same net cost in terms of


221

1

compensation to each of the bargaining units after

2

you factored in the general wage increases and the

3

work rule and benefits changes, or did you have

4

variation built in?

5

THE WITNESS:

There was variation because,

6

as I said, some crafts, once you got beyond health

7

and welfare and wages that had little or no rules to

8

give or either party was not interested in pursuing.

9

ARBITRATOR JAFFE:

So some of the work

10

rules have significant dollar effect, others not

11

much at all, question mark?

12

THE WITNESS:

That would be correct.

13

ARBITRATOR JAFFE:

Okay.

And so the

14

various organizations accepted -- those who settled

15

so far, I'm focused on obviously, accepted the same

16

general wage increases, but maybe different value.

17 18 19 20

Some got less than others, some more, question mark again? THE WITNESS:

We didn't have in-depth

discussions at all about the valuing of those rules.

21

ARBITRATOR JAFFE:

22

THE WITNESS:

Okay.

I mean, with the PRLBC.


222

1 2

So what we got, we got, and we moved forward with deals.

3

ARBITRATOR JAFFE:

4

ARBITRATOR FISHGOLD:

5

Okay. Can I interject for

a moment?

6

ARBITRATOR JAFFE:

Of course.

7


Apparently, you say

8

this was a particularly -- discussed with UTU, the

9

question of the 120 days and the six months and the

10 11 12

et cetera. I mean, that's an extensive requirement of time on the part of these individuals, is it not?

13

THE WITNESS:

Yes, it would be.

14

It would be.

And, again, we're hoping

15

that the incentive out there will require people to

16

remain available, qualified, usable, et cetera to

17

help our operation.

18


Well, the hope

19

obviously is that will happen because if it turns

20

out that that's what really happens, and you wind up

21

paying the $500 or the $250, you might be getting

22

your money's worth in terms of having the


223

1

opportunity, the availability to use these people in

2

those positions where without that -- those changes

3

in the rules, you would not have that opportunity to

4

use those people.

5

THE WITNESS:

6

this will help us significantly.

7 8

Our operating people believe

They were at the table with us, the head of crew management in particular.

9


Now, I also heard

10

you, in response to one of Mr.

11

say that, as you're sitting here today, are you

12

still saying that the basis for an agreement with

13

the PRLBC would having to be the pattern including

14

the -- and I believe it's five work rules that have

15

been identified, the training for the maintenance of

16

way and what was the other one?

Wilder's questions,

17

Well, there were five as I recall five.

18

What you're interested in is -- and from

19

Amtrak's perspective, even though you couldn't --

20

even though we're find out what some of that data is

21

for the estimated or projected cost savings by

22

having those rules changes, you would anticipate --


224

1

you anticipate that same projections would probably

2

be applicable to the two remaining unions?

3 4 5 6

Talking about cost saving projections, productive, availability, et cetera. THE WITNESS:

Well, we never had those

discussions.

7

We shared volumes of information.

8


9

No.

I understand

you didn't have those discussions, but I'm asking

10

you, as you're sitting here now, you believe in

11

order -- if you were asked to justify why it is you

12

say you need those particular work rule changes for

13

this group, that you would be able to quantify it in

14

a similar fashion that you were quantifying with

15

the -- with your operating people with regard to the

16

other unions.

17

THE WITNESS:

Yes.

18

And I apologize if this may be saying the

19

obvious, but that has -- that data has been provided

20

repeatedly including in the last two comprehensive

21

packages in Tab 7, extensive annualized values to

22

the rules, sharing all this information, the


225

1 2 3 4

spreadsheets. ARBITRATOR FISHGOLD:

Let me give you a

big hypothetical. Hypothetically, if at some point during

5

the course of the proceedings you suddenly learn

6

through a witness or evidence that is produced by

7

the unions that, instead of the training change or

8

instead of another change that you have had in your

9

internal pattern, that would you consider -- and

10

they proposed something else, and there's a way to

11

try to quantify what the cost of that might be or

12

the value of that might be, are -- is Amtrak --

13

would Amtrak consider some other work rule changes

14

with regard to this particular group that were not

15

obtained with regard to the other groups that fell

16

into a pattern?

17 18

THE WITNESS:

In response to that

hypothetical, yes.

19


20

ARBITRATOR JAFFE:

21 22

Okay.

I had a few more in

some other areas. But before we leave the UTU, there was one


226

1

last factual question that I had.

2

Do these units have yard conductors as

3

well, or only passenger -- are there people who work

4

only in the yard in the UTU?

5

THE WITNESS:

I'm not familiar with what

6

that might be on the freights, but on Amtrak there

7

are some assignments that were predominantly yard

8

transfer crews, but combined rosters.

9

ARBITRATOR JAFFE:

Okay.

Would someone

10

who had that kind of assignment qualify for this

11

under this language, or was the intent by using the

12

phrase passenger conductor position to exclude that

13

individual?

14 15

THE WITNESS:

No.

That individual would

qualify under this.

16

ARBITRATOR JAFFE:

Okay.

Let me shift

17

gears, if I may, away from the UTU and the conductor

18

issues.

19

You indicated that the incentive plan that

20

was referenced in each of the agreements is possibly

21

being created had not yet been created.

22

Did I hear correctly?


227

1

THE WITNESS:

That is correct.

2

ARBITRATOR JAFFE:

Do you know whether

3

that has been abandoned for the term of the

4

agreements or whether there are still plans on the

5

table to do something whatever that something may

6

be?

7

THE WITNESS:

It has not been abandoned.

8

And the problem is we never anticipated

9

being this far downstream and not having everybody

10

on board where depending what the national metrics

11

might be, we can have everybody pulling in the same

12

direction, CSI, one-time performance, customer --

13

that's -- excuse me for the jargon, customer

14

service, customer service index.

15

And so we had anticipated putting together

16

a plan with all unions participating in the same

17

time and pulling.

18

ARBITRATOR JAFFE:

Okay.

So the failure

19

to have reached agreements with these two groups put

20

that on hold from Amtrak's end?

21

THE WITNESS:

Yes.

22

ARBITRATOR JAFFE:

Okay.


Let me shift

228

1

gears, if I may again, and focus on AmPlan, and I

2

have got some very narrow questions.

3

THE WITNESS:

Okay.

4

ARBITRATOR JAFFE:

Historically, do you

5

know whether changes have been made on a bargaining

6

unit by bargaining unit basis as settlements have

7

been reached?

8 9

Have there been any staggered settlements in the past much like you wound up with in this

10

round, or is it the first time that changes didn't

11

take place for all of the organizations on the same

12

day?

13

THE WITNESS:

Most of our bargaining that

14

I have been familiar with is units would come in at

15

different times.

16

Some would come in at the same time, but I

17

don't think we have ever reached a settlement with

18

certainly everybody at once.

19

ARBITRATOR JAFFE:

Okay.

And have changes

20

to either employee contribution rates or plan

21

provisions or whatever it may be, been implemented

22

on a unit-by-unit basis as the agreements are


229

1

reached?

2 3

THE WITNESS:

police, I don't believe so.

4 5

With the exception of the

They have a slightly different approach on a few provisions, but no, I don't.

6

And the TCU and the ASWC have a slightly

7

different series of provisions on disability,

8

lengths of disability times.

9

some different rules, but it's not common.

10 11

ARBITRATOR JAFFE:

So we have reached

Okay.

So even

though --

12

THE WITNESS:

But it has been done.

13

ARBITRATOR JAFFE:

14

I didn't mean go cut you off.

15

So even though it's a single plan, it has

I'm sorry.

16

been applied differently in certain respects to

17

different bargaining units based on whatever was

18

bargained?

19

THE WITNESS:

Yes.

In those areas that I

20

cited are a couple that come to mind.

21

ARBITRATOR JAFFE:

22

And so the change in ER costs have been

Fair enough.


230

1

applied at this point to all of the groups other

2

than the BRS and the BMWED?

3

THE WITNESS:

Yes.

4

ARBITRATOR JAFFE:

Okay.

Early on in your

5

testimony, you referenced a cap on comp time with

6

respect to at least one of the other organizations.

7

I apologize for not focusing on it at the

8

moment.

9

time usage during the course of a year.

10

But you described it as a limit on comp

Is it a limitation on what can be earned

11

as well, or were you precise in the description and

12

it only applied to what could be used as distinct

13

from what could be earned?

14 15

THE WITNESS:

I would have to look at the

rule, which I can do.

16

ARBITRATOR JAFFE:

17

THE WITNESS:

18 19 20

Fair enough.

But our focus was to cut the

amount of time that people were taking. And so that's why we had a cap on it that was in the rules we reached.

21

ARBITRATOR JAFFE:

22

Anything further?

Okay.


231

1

Anything further from you?

2

I think we're in good shape.

3

Anything further from counsel on either

4

side?

5

First, any further direct?

6

MR. REINERT:

7

ARBITRATOR JAFFE:

8

MR. WILDER:

9

12 13 14

BY MR. WILDER: Q

19 20 21 22

Is the time that's banked in lieu of

overtime? A

Yes. You take the half or premium portion of

the overtime, and you put that in the bank.

17 18

I had just one question,

FURTHER CROSS-EXAMINATION

15 16

Any further cross?

Mr. Chairman, relates to the bank time.

10 11

No further direct.

You get paid the straight time and bank the half. Q

All right. ARBITRATOR JAFFE:

Thank you for the

clarification. Anything further?


232

1

MR. REINERT:

2

to talk about schedule tomorrow.

3 4

Nothing further other than

ARBITRATOR JAFFE: very much, Mr. Woodcock.

5

THE WITNESS:

6

ARBITRATOR JAFFE:

7

10 11

Thank you to the Panel. Off the record.

(A discussion was held off the record, and the

8 9

Let me say thank you

witness stood down.) ARBITRATOR JAFFE: until 9 o'clock.

We stand in recess

Thank you.

(Whereupon, the proceedings in the

12

above-captioned matter were recessed at 5:20 p.m. to

13

resume on January 7, 2014 at 9:00 a.m.)

14 15 16 17 18 19 20 21 22


233

1 2

CERTIFICATE OF REPORTER I, Joseph A. Inabnet, do hereby certify

3

that the transcript of the foregoing proceedings was

4

taken by me in Stenotype and thereafter reduced to

5

typewriting under my supervision; that said

6

transcript is a true record of the proceedings; that

7

I am neither counsel for, related to, nor employed

8

by any of the parties to the action in which these

9

proceedings were taken; and further, that I am not a

10

relative or employee of any attorney or counsel

11

employed by the parties thereto, nor financially or

12

otherwise interested in the outcome of the action.

13 14 15 16

__________________________ Joseph A. Inabnet Court Reporter

17 18 19 20 21 22
