It’s back to the drawing board for BNSF’s plan to reduce labor costs. The Sheet Metal, Air, Rail and Transportation Workers union voted “no,” defeating a proposed new contract that would have allowed BNSF to employ one-person crews over roughly 60-percent of its routes.
The one-person crews would have been allowed instead of the standard two-person crews, provided that a remote-site-based Master Conductor is using monitoring technology known as Positive Train Control (PTC).
The trains would have had a locomotive engineer but no other onboard crew.
Declining Crew Costs
Even without the change crew costs for railroads have been steadily dropping over the past four decades. As recently as the 1970s, various states mandated as many as six employees per train.
BNFS had proposed union concessions that would have diminished at least a portion of its expected savings through increases in the pay of conductors and ground service workers.
© 2014 David Mazor
Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway, and this article is not a recommendation on whether to buy or sell the stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.