UTU News Digest - Thursday, January 20, 2000

UTU Daily News Digest

Information of interest to operating railroad and transportation employees

Thursday, January 20, 2000

CALIFORNIA: Union ranks up in '99, led by California

LOS ANGELES -- In a sign that aggressive organizing efforts are starting to pay off, especially in California, U.S. labor unions gained more members last year than at any time in the last two decades, the Los Angeles Times reported.

By adding 265,000 workers nationwide, unions were able to keep pace with the rapidly expanding economy, which grew by 2 million jobs in 1999, according to numbers released Wednesday by the Bureau of Labor Statistics.

Significantly, the rate of private-sector unionization held steady at about 9.4%, breaking a free-fall that began in 1973, when one in four private-sector workers belonged to a union. The overall unionization rate also held steady at 13.9% California led the nation, gaining 132,000 union members on top of the 87,000 added in 1998. In contrast, some states saw continuing declines, notably New Jersey, which lost 52,000 union members last year.

Labor unions, which have poured millions into high-profile organizing drives in recent years, were helped by two outside factors: The economy grew, which pulled thousands of new workers into unionized industries, and the flight of manufacturing jobs to low-wage countries, which was intense in the early 1990s, slowed.

The numbers were welcome news for the beleaguered U.S. labor movement, which has been trying mightily to stop its decline and regain relevancy in the changing economy.

But economists said it will be several years before anyone can declare 1999 a turning point.

"These numbers don't show a resurgence," said Henry Farber, a labor economist at Princeton University. "They show a stability, which in a sense is a victory. But to me, it's really looking for the silver lining to say, 'Hey, look at this. We didn't do any worse this year than last year.' "

But labor leaders hailed the numbers as evidence of a comeback.

"We're turning the corner," said AFL-CIO President John J. Sweeney, who has pushed unions to devote more resources to organizing since taking the helm of the 13-million-member federation four years ago. "Our challenge for the future is to remain focused and to broaden our efforts."

High-profile organizing drives championed by Sweeney, including a multi-union effort at Los Angeles International Airport, have had mixed results. He also has encouraged member unions to devote at least 30% of their resources to organizing--a dramatic change from the recent past, when unions instead focused almost exclusively on serving existing members.

Sweeney and others have argued that unless labor rebuilds its strength in the private sector, it can do little to improve wages and benefits.

AFL-CIO Organizing Director Kirk Adams said the net gain of 265,000 members actually reflects a much larger organizing effort, and that AFL-CIO figures show 600,000 new workers joined unions last year.

Some union jobs were lost as manufacturers moved to low-wage countries, although that movement has slowed.

"The jobs going out the back door have lessened considerably," Adams said. "There was a loss of 350,000 jobs last year, but only 120,000 were unionized."

However, to show real growth, labor needs to do much more--adding 500,000 to 1 million new members a year to keep pace with the growing economy and to counter the attrition of union jobs.

Some economists, including Farber, are skeptical that labor can achieve that kind of growth, especially as the economy loses manufacturing jobs, where unions traditionally have been strong, and gains low-wage service jobs, where unions have struggled. And Latinos, who account for a growing share of the low-wage work force, are the least likely to be union members.

But those difficult areas are precisely where California's labor growth has flourished, said Art Pulaski, secretary-treasurer of the California Federation of Labor.

"Particularly immigrant workers from Mexico and Central America," he said. "That's the strongest part of the work force for us."

Of California's new union members, 74,000 were home-care workers, mainly African American women and Latinas who organized following a 12-year effort.

The government numbers, which show overall U.S. union membership to be 16.5 million, are estimates based on the current population survey, which conducts a monthly survey of about 50,000 households. They do not include self-employed workers.

Of all demographic groups of workers, black men were the most likely to belong to unions, with a rate of 20.5%. Hispanic women were the least likely, at 10.4%. Union membership continued to be higher for men, at 16.1%, than for women, at 11.4%, although the gender gap has been closing in recent years.

Government workers continued to have the highest rate of union membership, at about 37%, compared to 9.4% for private-sector workers.

Labor leaders attributed the difference between public and private sectors, which has been growing for the last two decades, to vigorous resistance by private employers.

"That's the other side of the equation," said the AFL-CIO's Adams. "All the polling shows that there are millions of workers who want to join unions, but employers fight very hard."

To counter that resistance, unions are trying to build alliances with community and religious groups to put pressure on employers to stay neutral in organizing drives.

The survey also showed a wide--but shrinking--earnings gap between union members and nonmembers, but noted that the difference can be attributed to many factors, including the distribution of members by occupation, industry or geographic region.

NEW YORK: Amtrak given BBB rating

NEW YORK -- Standard & Poor's said Wednesday it has assigned a BBB issuer credit rating to the National Railroad Passenger Corp., Amtrak, and it said the outlook is developing, Dow Jones reported.

The S&P rating was previously confidential.

The rating agency said the issuer credit rating of Amtrak reflects its important public service role, operating improvements over the past two years and continued, although substantially changed, assistance from the federal government.

It said these factors offset a weak financial profile. In addition, potential restructuring, system rationalization, or liquidation of Amtrak could occur under existing legislation if an oversight board created in 1997 determines that Amtrak will require an operating grant after late 2002, S&P said.

Substantial evidence of political support (appropriations in the face of significant challenges; $2.2 billion of capital funds) is taken into consideration and reflected in the current rating, it said, since without such support, Amtrak wouldn't cover its cash operating expenses from operating revenues.

Standard & Poor's said legislation passed in 1997 mandated that Amtrak reach operating self-sufficiency by Dec. 2, 2002 and added a performance-related sunset trigger.

It said although this legislation contains several features that are supportive of Amtrak, provisions for a potential restructuring or liquidation of the company tied to performance-related goals are unusual for an entity of or owned by the federal government and caused the rating to be lowered to its current level in early 1998. The uncertainty associated with the sunset provisions currently precludes a higher rating, but continued progress toward self-sufficiency and evidence of broadening political support could justify a rating upgrade, according to S&P.

It said Amtrak has made progress over the past two years toward the required goal of self-sufficiency from federal operating grant funds. Management's strategy to eliminate reliance on operating subsidies through substantially greater capital investment designed to attract new customers and lower costs is a necessary, although high risk, strategy, Standard & Poor's said.

The rating agency said the outlook could be revised to stable or ratings raised, despite the threat of a potential restructuring or liquidation of the company, if management meets or exceeds plans for self-sufficiency, which would primarily result from a high degree of success with new initiatives, especially high speed rail in the Northeast corridor.

Ratings could be lowered if management is unable to reduce operating losses and fund significant capital spending needs during the next three years, and it appears to be unable to reach a goal of self-sufficiency, Standard & Poor's said.

CANADA: Ford Excursion ad riles railroads, safety group

TORONTO -- A Ford Motor Co. of Canada Ltd. advertisement that depicts the automaker's 19-foot-long Excursion sport utility vehicle forcing a passenger train to stop in its tracks has upset Canada's big train companies, Canadian media reported.

The rail operators complain that the magazine ad, showing the truck passing in front of a halted train, is confusing and pokes fun at level crossing safety.

"We don't think it's a joke," said Benoit Levesque, national director of rail safety group Operation Lifesaver. He sent Ford a letter deploring the ad and has encouraged the country's 50 rail operators to send similar letters to the Oakville, Ont., car company. Via Rail Canada Inc. and Canadian National Railway Co. have also complained about the ad.

Mr. Levesque said Bobbie Gaunt, president of Ford Canada, had responded in a Jan. 6 letter. "I am concerned you did not appreciate the ad and thought the message portrayed was misleading and dangerous," wrote Ms. Gaunt, a former marketer with Ford. "This ad was designed merely as a humorous role reversal of an everyday occurrence."

Ford said the 2000 Excursion ad campaign will appear only in December and January issues of magazines.

"The ad was designed to reflect the personality of the Excursion," said Lauren Moore, marketing and sales communications manager at Ford Canada.

The biggest sport utility on the road, the nine-passenger, 4,200-kilogram truck's chief selling points are its whopping power from a V-10 engine giving 10,000 pounds of towing capacity. For the benefit of smaller vehicles on the road, the Excursion also has the patented "BlockerBeam technology" to prevent cars from sliding underneath it in a collision.

"The magazine ad was meant to reflect these attributes in its kind of light-hearted proclamation that Excursion commands respect," said Ms. Moore, who added that the company had not received any complaints from consumers.

Created by ad agency Young & Rubicam Canada, the ad pits the Excursion against the train with the aid of computer wizardry.

Operation Lifesaver, which aims to reduce rail carnage -- 37 Canadians were killed in rail crossing collisions last year and 61 died walking along tracks last year -- is in a constant battle with advertisers. Mr. Levesque points to a near-identical ad for Toyota's Prerunner passing a halted train now running in magazines.

"All these ads are now starting to creep into us and more and more often," he said. "We write and every time we write they take it into consideration, but not a hell of a lot is being done about it."

CANADA: Transport 2000 Canada opposes Ford ad

TORONTO -- Transport 2000 Canada is calling on Ford of Canada President Bobbie Gaunt to stop running ads that show a sport utility vehicle crossing rail tracks in front of a train, the Canadian media reported.

"There are kids who are going to take this ad more literally than Ford intends," says Harry Gow, President of Transport 2000 Canada. "We already have enough problems with level crossings. Ford should pull these ads. We don't need sport utility vehicles playing chicken with trains," Gow says.

Gow says: "Governments should find ways of taxing SUV owners at higher rates to compensate for their excessive energy consumption, the damage they do to the environment off the road and the harm they do to regular vehicles when they are involved in collisions."

The ad is in this month's edition of Saturday Night. Transport 2000 Canada is a transportation watchdog group with more than 1,000 members across the country.

NEBRASKA: Union Pacific announces fourth quarter results

OMAHA -- Union Pacific Corporation today reported substantial improvement in its operating performance. Net income for the fourth quarter was $242 million, or $.95 per diluted share.

The last quarter of 1998 yielded net income of $96 million, or $.39 per diluted share, excluding the impact of a one-time charge associated with revaluation of goodwill at Overnite Transportation Company. Fourth quarter results included one-time, after-tax merger implementation expenses of $9 million, or $.03 per diluted share in 1999, and $7 million, or $.03 per diluted share in 1998.

Union Pacific Corporation, excluding Overnite, reported record operating income of $499 million in the fourth quarter of 1999, compared to $256 million for the same period in 1998. The Railroad's commodity revenues were up 8 percent to a record $2.5 billion for the quarter, with gains in all six of the major business groups. Intermodal and Industrial Products led the way, with gains of 16 and 12 percent respectively, while Energy set a fourth quarter revenue record and Autos turned in a best ever quarter. Increased revenues and productivity improvements lowered the operating ratio to 80.8, a reduction of 8.6 percentage points from the prior year.

Overnite Transportation reported a fourth quarter operating loss of $13 million compared to operating income of $16 million in 1998, excluding a one-time charge for the revaluation of Overnite goodwill. Overnite's revenues in the quarter remained essentially flat with the prior year at $259 million. Operating expenses increased 12 percent due to costs associated with a Teamster-led job action. Despite the Teamsters activity, on-time performance improved to 97% for the quarter, the highest all year.

For the total year 1999, Union Pacific Corporation reported net income of $810 million compared to a net loss of $86 million in 1998 excluding the writedown of Overnite goodwill.

"Our fourth quarter results culminate a successful 1999 for Union Pacific and lay a strong foundation as we head into 2000," said Dick Davidson, Chairman and Chief Executive Officer. "In the upcoming year, Union Pacific will stay the course, with unrelenting focus on growing our business by providing high quality, reliable service. We are committed to achieving our vision by translating the tremendous potential of our franchise into tangible results."

MONTANA/IOWA: Montana and I&M Rail Links launch safety program

ST. LOUIS and DAVENPORT -- Montana Rail Link, Inc. (MRL), I&M Rail Link (IMRL) and LaBarge, Inc. have jointly announced the launch of a new highway-rail safety program that will help the railroads remotely monitor active highway-rail grade crossing signals and reduce potential field problems over 2,200 miles of track, press release said.

The program calls for the installation of the ScadaNET Network(TM), an innovative rail crossing monitoring system from LaBarge that utilizes wireless communication from more than 500 crossing signals in six states to the railroads.

"Public safety has always been our top priority," says Steve Griffin, manager, signals and communications for both railroads. "Whenever we have a crossing malfunction, we want to receive information as soon as possible and one of the best ways we have found is using the ScadaNET Network(TM)."

The ScadaNET Network(TM) will provide the railroads with prompt crossing alarm and equipment status information, including the early warning of potential equipment malfunctions. Important status information will be delivered from remote CellularRTU(TM) field units at each grade crossing simultaneously to select railroad officials and maintenance personnel using a variety of means including the Internet, e-mail, pagers and facsimile in addition to the direct data link to the railroads.

Some of the potential problems the system can detect include commercial power failures, gates that are down when there are no trains, low battery charges, and crossing signal malfunctions.

"The cost and functional advantages of the ScadaNET Network(TM) really benefit users like MRL and IMRL," says Tom Hilleary, vice president - business development for LaBarge's Network Technologies Group. "These progressive railroads have operations that are geographically wide-spread and the system allows their signal engineering organization and field maintenance staff to confirm status of a distant crossing over the Internet. Travel times are cut significantly, maintenance efficiency increases, and response times to field problems are substantially reduced through the prompt notification that the system provides."

MRL and IMRL began testing the ScadaNET Network(TM) units in 1999 at various highway-rail grade crossings throughout the two railroad systems. Sixty units have been installed; approximately 25 to 30 units are expected to be installed annually on each line.

"The units are performing very well and we are pleased with the system," says Griffin. "Installation was easy and the monthly operating cost is very economical."

MRL and IMRL are replacing current equipment that records events at highway-rail crossings and transmits the information over phone wires, costing the railroad approximately $50 per month per crossing. The ScadaNET Network(TM) operates through the cellular telephone network's control channel. There are no monthly telephone fees or cellular access charges. Alarm notifications are accomplished for less than the cost of a public telephone call.

Additionally, the system operates 24 hours a day and employs multiple layers of security to fully protect data from unauthorized access.

ILLINOIS: Bellwood man killed, apparently by train

CHICAGO -- A 22-year-old Bellwood man was killed Tuesday afternoon in Maywood after he was apparently hit by a freight train, fire and police officials said, the Chicago Tribune reported.

The body of the man, who was identified by the Cook County medical examiner's office as Ryan Hill of the 400 block of 22nd Avenue, was found shortly after noon at Railroad Street and 17th Avenue, fire officials said.

His body was found near the Union Pacific West tracks, but not near a crossing, fire and police officials said.

"There was no train in sight so I'm not sure what train hit him," Maywood Fire Department Lt. Donald Zeller said.

Hill was pronounced dead at Westlake Community Hospital in Melrose Park, fire and police officials said. Police are still investigating the incident.