Union opposes CN/IC merger

CLEVELAND (March 11) — The North American rail industry’s largest labor union has told the U.S. Surface Transportation Board (STB) to reject the merger of the Illinois Central and Canadian National railroads.

The head of the United Transportation Union, which represents 6350 workers at the two railroads, said the proposed merger would be “another merger fiasco,” referring to service troubles stemming from Conrail’s takeover by CSX and Norfolk Southern, and Union Pacific’s merger with Southern Pacific.

“Nothing we have heard from the CN and IC gives the UTU any reason to believe that the contemplated transaction is intended for anything other than transferring wealth from the railroad workers to the stockholders and, in fact, to the officers of the two railroads,” said UTU president Charles L. Little.

The STB is scheduled to convene hearings on March 18 on CN’s proposed buyout of IC, which would create North America’s fifth-largest rail system.

Little said the UTU’s concerns regarding the merger include:

> The substitution in toto of collective-bargaining agreements more favorable to management for those labor contracts considered more limited and costly, and the re-arrangement of seniority in a manner that is not a necessity to accomplish the merger;

> The creation of jobs with longer hours of work. The union said its wants the STB to withhold any action until the Federal Railroad Administration and the STB issue new safety rules governing railway mergers and start-ups. The union also said the STB should not approve the transaction until these procedures have been followed and completed.

Little said the UTU requested that the STB require two conditions which should be included in any order of approval.

The first is that the CN and IC may not impose an entirely new, complete, collective-bargaining agreement upon employees in the guise of being part of the implementing agreement. The only labor contract changes that may be made through the implementing agreement are those changes necessary to effectuate the merger and then only if necessary to obtain a non-labor-related transportation benefit, he said.

The second is that the applicants must negotiate fairly and equitably with the representatives of the employees affected by the merger.

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