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July 14, 1972


Fullam, District Judge.

The opinion of the court was delivered by: FULLAM

FULLAM, District Judge.

 The Trustees' "Petition . . . for a Hearing on the Status of the Crew Consist Controversy" (Document No. 3751) presents issues of crucial significance to this reorganization and the future viability of Penn Central. Specifically, the question to be decided is what actions the Trustees should be permitted to take in order to achieve final resolution of the long-standing dispute over the number of employees needed to operate trains.


 The basic controversy over attempts to reduce operating costs by eliminating allegedly excessive employees is essentially divisible into two parts: disputes concerning the size of the crews of locomotives (specifically, the necessity of employing firemen on diesel locomotives); and the size of the crews of trains, as distinguished from locomotive crews. The former, generally designated as the "fireman manning" dispute, is being handled through industry-wide bargaining; *fn1" the latter, generally designated as the "crew consist" dispute, is the only aspect of the controversy involved in this proceeding. The term "trainmen" is used herein generically to designate all persons (approximately 18,800 in number) employed by the Debtor on crews of trains, as distinguished from locomotives. The job assignments included within the term "trainmen" are conductors, assistant conductors, ticket collectors, baggagemen, brakemen, flagmen, foremen, helpers, etc.

 The heart of the present dispute is whether the appropriate crew consist should be "one and one" or "one and two" (i.e., one conductor/foreman and one brakeman/helper, or one conductor/foreman and two or more brakemen/helpers).


 The employees involved in the present dispute are represented by the United Transportation Union (hereinafter UTU), which came into being on January 1, 1969, in consequence of the merger of the Brotherhood of Railroad Trainmen, the Brotherhood of Locomotive Firemen and Engineers, the Order of Railway Conductors and Brakemen, and the Switchmen's Union of North America. For labor-management purposes, the Debtor's railroad is divided into 10 geographical districts, in each of which the union is represented by a general chairman (and, of course, various subsidiary union officials.)

 The present dispute involves proposed changes in nine collective bargaining agreements, one for each division (one agreement covers two divisions). All of these agreements incorporate the terms of the "Luna-Saunders Agreement" (discussed below), which establishes a minimum crew consist of one-and-two.

 Pursuant to Order No. 134 herein, the Congress of Railway Unions has intervened in the reorganization proceedings on behalf of all labor organizations representing the Debtor's employees, including the UTU.

 III. background of the crew consist dispute

 The present controversy stems from the long-standing failure to resolve issues arising from the inherent conflict between technological advancement and maintenance of levels of employment. It has long been the view of railroad management in general that much of the work formerly required of trainmen (e.g., manual control of brakes, visual checks of the wheels to detect overheating, manual passing of signals, and, in some situations, loading and unloading of freight cars) is now being performed automatically ("hot box detectors," centrally controlled braking systems, automatic signals, radio communications, yard modernization, etc.); and that, with respect to a substantial majority of trains, the work can be performed safely and without undue burden by a crew consisting of a conductor and one additional trainman.

 Traditionally, management has contended that crew size should be determined by management, in its sole discretion. In general, the unions have contended that reductions in crew size would be incompatible with safe operations, and would impose excessive work loads upon remaining crew members; that determinations of the proper crew consist must be made separately for each train, in order to give adequate consideration to varying circumstances; and that all such determinations should be made jointly by management and labor, through collective bargaining.

 For present purposes, it will suffice to sketch briefly only the relatively recent history of the controversy.

 On November 2, 1959, on a nationwide basis, the railroads served Section 6 notices proposing the elimination of existing rules on the subject of crew consist in road and yard service, and proposing that management be given the right to establish crew sizes. Ten months later the unions submitted counter-proposals seeking to establish minimum crews of one and two. There were a great many other unresolved issues between management and labor at the time. Both sides agreed to submit all of these issues to an independent commission for study and recommendation. Pursuant to executive order, the Presidential Railroad Commission was created on November 1, 1960; it was composed of an equal number of public, railroad, and union members. After lengthy public hearings and field inspection trips, the Commission issued its report on February 28, 1962.

 With respect to the crew consist issue, the Commission found that there was substantial overmanning (although perhaps not as much as the railroads contended); that the determining factors in each case should be safety and avoidance of excessive work loads; that all crew consist disputes should be resolved locally through collective bargaining, culminating in binding arbitration of each dispute that was not settled within 60 days; and that reasonable job protection should be provided for employees adversely affected.

 After the Commission rendered its report, further efforts to mediate a settlement were unsuccessful, and Emergency Board No. 154 was established pursuant to the Railway Labor Act. The recommendations of Board 154 generally tracked those of the Commission, but added the further recommendation that reductions in crew consist should be accomplished through attrition. The railroads accepted these recommendations, the unions did not. Extensive further negotiations failed to produce a settlement of the controversy.

 On August 28, 1963, Congress enacted Public Law 88-108, 77 Stat. 132, creating Arbitration Board No. 282 to render a binding decision of the crew consist (and fireman manning) issues. This Board rendered its decision, effective January 25, 1964, and remaining in effect for two years, expiring on January 25, 1966. The award mandated local determinations of crew consist disputes, with provision for binding determinations by special boards of adjustment; again, the sole criteria were safety and work load, and any reductions were to be accomplished through natural attrition.

 During the two-year period in which the award of Board No. 282 remained in effect, there were 94 crew consist agreements negotiated throughout the industry, and 96 decisions issued by special boards of adjustment. The special boards authorized elimination of approximately 87 percent of the jobs presented to them by the railroads. The combined effect of the awards and agreements was the temporary abolition of 8,020 jobs on 7,807 crews; approximately 75 percent of the one-and-two crews submitted were reduced to one-and-one. Insofar as the Debtor's predecessors were concerned, on the New York Central, five awards of special boards and one agreement resulted in elimination of 965 of the 1,127 jobs proposed by the railroad. The Pennsylvania Railroad did not submit any jobs to special adjustment boards; its proposals to abolish more than 2,200 jobs were terminated by a negotiated agreement reducing the size of 204 train crews temporarily for the period from May 8, 1965 to January 25, 1966, when the Board No. 282 award terminated and the "Luna-Saunders" agreement became effective.

 For several reasons, the reductions accomplished pursuant to the award of Board No. 292 did not long survive the expiration of the two-year period of that award. For one thing, both the Presidential Commission and Board No. 282 had concluded that implementation of their recommendations could not relieve the parties from compliance with state "full-crew" laws; many railroads, including the Debtor's predecessors, felt that the unions' opposition to repeal of these laws presented an insuperable obstacle to any meaningful solution of the overmanning problem. Moreover, there was uncertainty and controversy as to whether reductions achieved during the two-year period would remain in effect after the expiration of the award on January 25, 1966. The unions contended that all crews reduced during that period would revert to their former consist automatically at the expiration of the award, while the railroads argued that the award of Board 282 modified the collective bargaining agreements, and that these modifications would remain in effect unless and until altered pursuant to the Railway Labor Act.

 Most of the eastern railroads, including the Debtor's predecessors, resolved these problems by entering into the "Luna-Saunders" agreement, effective January 25, 1966. Under this agreement, the railroads bargained away any rights to further benefits of award 282 and agreed to a minimum crew consist of one-and-two for a period of at least five years, in exchange for the unions' agreement to withdraw their opposition to repeal of the state full-crews laws. *fn2"

 The Luna-Saunders agreement continued in effect until January 1, 1970, and thereafter unless and until modified pursuant to the "major disputes" provision of the Railway Labor Act. The petition now before the Court is an outgrowth of the Trustees' attempts to achieve such modification.


 The 26-page affidavit of Mr. John J. Maher, Vice President-Administration of the railroad, and the railroad's chief negotiator (Document No. 3791), sets forth the procedural history of this dispute. Briefly summarized, the following occurred:

 After the parties, on January 1, 1971, became free to seek modification of the existing labor agreements, the railroad sought to negotiate the crew-consist issue, but made no progress. On June 7, 1971, the railroad served its Section 6 notices, proposing to eliminate all existing restrictions and to substitute a new rule providing that crew consists would be determined solely by management. Direct negotiations, pursuant to the Railway Labor Act, extended through June, July and August, 1971, and were terminated by the railroad on September 7, 1971. Throughout this period, the railroad made clear its willingness to settle the crew consist controversy on any one of several alternative bases, including such possibilities as a rule specifying crew size, a procedure for determining crew size with finality, or any other arrangement which would settle the controversy promptly and on its merits. During this same period, the union served various notices on the railroad, proposing to increase the number of road and yard trainmen to be assigned to crews.

 Initially, there was confusion and uncertainty as to whether the controversy was to be negotiated on a system-wide basis, or separately with each of the 10 general chairmen of the union, representing the 10 geographical districts of the railroad. At the first meeting on June 16, three general chairmen were in attendance, all of whom suggested and agreed that the matter should be handled through the President of the union. It was agreed that a further negotiating session would be held on June 30, and that in the meantime, all 10 general chairmen would hold a meeting, and the President of the railroad would meet with the President of the union to discuss the procedural problems. At the meeting between the two Presidents, on June 23, 1971, the union President stated that he wished to leave the decision as to the method of handling the case to the vote of all of the general chairmen involved.

 At the next negotiating session on June 30, only five general chairmen were present. They stated that they could not agree to any system-wide handling of the dispute, and that each general chairman could speak only for the employees he represented. All further conferences were held on that basis.

 Except for its original Section 6 counter-notices, the union made no proposals at all, nor did it respond to any of the company's proposals. Ultimately, on September 10, 1971, the company terminated negotiations. Various general chairmen then invoked the services of the National Mediation Board, pursuant to Section 5 of the Railway Labor Act; and the railroad made a similar request in response, on September 29, 1971. Mediation commenced on November 17, 1971, and continued through December. At the December 14 session, it was agreed that mediation efforts would be resumed at the Board's headquarters in Washington on January 4, with all 10 general chairmen present. However, because of conflicting engagements, the general chairmen did not attend that meeting, and mediation did not resume until January 17. At that session, the union representatives advised that they were unwilling to discuss the crew consist dispute unless and until various other unrelated matters were the subject of mediation procedures before the Board. This was arranged, and all disputes were scheduled for simultaneous and concurrent handling, beginning January 20. However, none of the 10 general chairmen attended that session, and the union insisted that mediation take place at six separate locations on the Penn Central property, rather than in Washington.

 On January 21, the Mediation Board met in executive session, and thereafter announced that mediation would continue at the Board's headquarters in Washington, commencing on January 24. The railroad representatives attended, the union representatives did not. The union representatives advised the Mediation ...

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