Talking Labour Relations

 

  from CP Magazine Volume 3, 2014

Assistant Vice-President Labour Relations Myron Becker weighs in on everything from capital investment to improving the quality of life in the field

talking-labour-relations

Welcome to CP and Calgary. How was your move to Calgary?

In a way, it’s been like coming home. I have lived and worked in Jasper and Edmonton, and I have family in Calgary. It’s good to be back.

You’ve been at three other companies during your career?

That’s right. I joined CP from NetJets™, a Warren Buffett Berkshire Hathaway company where you can rent a private jet—similar to a timeshare. Berkshire Hathaway also owns BNSF® Railway. Before that I was with CSX based in Jacksonville, Fla., and before that with CN (in Canada and in the U.S.).

Have you always been in labour relations?

My career began as a brakeman, conductor and locomotive engineer based out of Humboldt, Sask. Later I joined the labour relations group at CN. I have lived all across Canada and in parts of the United States. Numerous moves throughout my career have provided a lot of great experiences for me and my family.

With all this experience, what have you noticed at CP that is the same, and what’s different?

From the outside, I didn’t realize the challenges facing CP were so profound. Railroading experienced a seismic shift a number of years ago. It’s not that CP necessarily got worse—it may have even gotten a little better—all the other Class 1 railways just passed us by. I recall a period of time when we were ranked in the upper part of this industry. Unfortunately we dropped to dead last. To keep the ship upright, CP sold stock valued near the bottom of the market, incurred more debt to finance our pension plan and sold off parts of our railroad. I am not sure many people understood, but our credit rating fell to a BBB-minus rating.

What does that mean?

A rating of BBB-minus represents the lowest investment rating available. In practical terms, when we borrow money our interest costs are 40 per cent higher than what our major competitor is charged. As a capital-intensive business, we have to borrow money, but high interest rates boxed CP in financially. When a company is boxed in financially the necessary capital investments can’t be made, which further intensifies the problem. Talking to people here, I know that this bothered a lot of very proud railroaders. One way or another, everyone could see that change was due at CP. Things are better now that we are further into the turnaround. CP is investing more money into upgrading track and signal systems. These capital investments will benefit our locomotive company and all of our customers. On the bright side, I have met many great railroaders since coming aboard last August. From the ballast to the boardroom, there is considerable talent throughout this railroad. You can see it in the recent results. As a result of the right leadership and plan we are no longer at the bottom of the heap. We’ve got our eye on being number one, and I think we’re all pretty keen to get there.

As a former engineer, what else have you seen change in your career?

What’s important to people has changed over time. People are still looking to make good money. But now they are also asking if there can be a better lifestyle that goes with a railroading career. Being a former engineer, I understand how that feels. I’ve always believed that if the company and the union can simplify collective agreements and bargaining processes we can address these four key employee concerns: salary, job description, benefits, work schedule and vacation days. There are a lot of things I have seen, learned from and implemented during my career that helped people achieve an improved quality of life. The improvements I am most proud of have addressed these concerns.

Like what?

For instance, “meet and turn” operations. Traditionally, CP and many other railroads run a crew from one terminal to another, put them up for some period of time, then turn them around and have them run a train back in the direction of home. It is not uncommon for Train and Engine personnel (T&E) to work a round trip (two runs) and be away from home at least one night. But it doesn’t have to be like this anymore. Once a set schedule is implemented, you can stick to a consistent start time and get across the railway reliably. One option I’ve raised with some of the union leadership is that we structure employee schedules so one train leaves a terminal heading east and one train leaves another terminal heading west. They meet at a point where the crews switch and take the other train back home. At the end of the day more employees will get home quicker and be able to sleep in their own bed. This is simply better for everyone— including the company. It helps us attract and retain people, lowers the cost CP incurs when employees are on the road, and provides a better working environment for our T&E personnel.

That’s a big change.

It is. Unfortunately it doesn’t work everywhere. You need balance—one train going in each direction. We’ve identified terminals where it can work and for the benefit of our employees I think we should give it a try.

What else are you doing?

Yes there are other things we are prepared to do for our T&E personnel that would give 95 per cent of them more money than they earn today and offer a better lifestyle. The plan is pretty basic. In exchange for work-rule flexibility and up to 12 hours in a day, employees can go to work three to five times less in a month and make more money. With other railroads I have worked for, various forms of scheduling was implemented to address lifestyle concerns. To be clear, not everyone would have to work a 12-hour day, unless in the event of an operational issue.

How do you get people to take that leap?

It requires a lot of trust. You give them a way out. Some call them reversionary clauses, cancellation clauses or ejection-seat clauses. Whatever you call them, we agree on a plan with a four- to six-month trial period. If it doesn’t work, either the union or the company can cancel with 30 days’ notice.

Has it worked?

I’ve been a part of change at two different railroads before CP and the arrangements were slightly different for each. What I have found is that if people try it, they love it. The facts are out there; since this type of agreement was first implemented in 2002, the ratification approval rates are among the highest in the industry. The only contrary evidence I have seen was that some unions at a former company asked for the cancellation clause to be taken out. They didn’t want the remote chance that their hourly-rated deal could be taken away. One of the biggest benefits of an hourly styled agreement is that in exchange for improved flexibility we are able to provide lifestyle benefits and pay people well. This allows all of us to focus on what we are here to do—operate trains and exceed our customers’ expectations. Look, I understand that this will be a big change. There are people in the union ranks and management who are concerned. We have managers saying: “That’s a lot of money we are going to pay them.” But I know it works for everyone. If for some reason it doesn’t work here, we have reversionary clauses. This is how we can dramatically improve people’s quality of life and income. It’s getting to do things like this that gets me up in the morning.

Is this coming to CP?

We’ve asked our running trades unions to consider the items discussed here. Depending on the arrangement we could see a rate in the range of $40 per hour. We’ve had considerable interest in the U.S. We’ve had less interest in Canada so far, but there’s a lot of other noise here. So I believe that some group, some day is going to make the breakthrough at CP. When they do, they will be much better off for it. If there is one thing I regret about these deals, it’s that I didn’t have one when I was a locomotive engineer.

Talking Labour Relations |   CP Magazine Volume 3, 2014