# Appendix — Cannon v. Consolidated Rail Corp.

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## Record

- **Collection:** Supreme Court brief
- **Document type:** Appendix
- **Published:** January 1, 1982
- **Citation:** 457 U.S. 1133

## Text

APPENDIX

TABLE OF CONTENTS
Page
Appendix A Judgments and Opinion of Special Court, Re-
gional Rail Reorganization Act of 1973..... la

Appendix B Northeast Rail Service Act of 1981, § 702 of
the Regional Rail Reorganization Act of 1973 3la

Appendix C Railway Labor Act, § 6, 45 U.S.C. § 156 . 35a

Appendix D Regional Rail Reorganization Act of 1973,
§ 504(a) and (d), 45 U.S.C. § 774(a) and (d) 37a

Appendix E Stipulation of Facts ................44.. 39a

la

APPENDIX A

SPECIAL COURT
REGIONAL RAIL REORGANIZATION ACT OF 1973

CIVIL ACTION NO. 82-4

UNITED TRANSPORTATION UNION,
Plaintiff,
ie
CONSOLIDATED RA CORPORATION,
Defendant.

JUDGMENT
(FILED APRIL 7, 1982)

This action having come on for hearing on March 10, 1982, on
cross motions for summary judgment, the issues having been duly
heard and the opinion of the Court having been filed on March 31,
1982,

IT IS ORDERED AND ADJUDGED, in accordance with that
opinion, that § 702 of the Regional Rail Reorganization Act of 1973,
as amended by § 1143(a) of the Northeast Rail Service Act of 1981,
confers authority on Consolidated Rail Corporation to take the ac-
tions specifie~ in that section without regard to the Manning Agree-
ment, the Crew Consist Agreement or any other collective bargaining
agreement; and,

IT IS FURTHER ORDERED AND ADJUDGED that Plaintiff's
motion for summary judgment is hereby denied.

/s/ Henry J. FRIENDLY
Henry J. Friendly
Presiding Judge

April 7, 1982

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SPECIAL COURT
REGIONAL RAIL REORGANIZATION ACT OF 1973

CIVIL ACTION NO. 82-7

CONSOLIDATED RAIL CORPORATION,
Plaintiff.
Vv.
UNITED TRANSPORTATION UNION,
(“UTU”); F.A. Hardin;
UTU General Committees of
Adjustment for

- Conrail North

- Conrail South

- Conrail (CR&1)

- Conrail (1U)

- Conrail (L&HR)

- Conrail (Niagara Junction)

- Conrail (PC-ED-NYC)

- Conrail (PC-WD-NYC)

- Conrail (PC-ND-NYC)

- Conrail (ILL DIV-NYC-B&A)

- Conrail (PC-SP DIV-B&A)

- Conrail (PC-NHR-NYNH&H)

- Conrail (PC-Line East-PLE)

- Conrail (West & South)

- Conrail (Reading):

UTU GENERAL CHAIRMAN L.W. Swert, L.R. Davis, J. Migas.
W.E. Curtis, C.F. Fuller, T. McGovern, George Baloozian, J.J.
Kenefick, J.W. Thurston, A.P. Ramsey, E.T. Adkins: R.E. Doan,
T.C. Roll, C.A. DeBolt, R.D. Jarvis, W.A. Beebe; C.P. Jones; P.V.
Hemmer, R.P. Miller:

UTU LOCAL UNIONS OR COMMITTEES OF ADJUSTMENT
Numbers 1418, 419, 405, 1473, 394, 352, 254 and 215;

UTU LOCAL CHAIRMEN J.L. Arnold, T.E.. Polniak, R.D. McGaw,
R.S. Connors, Norman Dellaghelfa, R.T. Roche, $.T. Cowles,

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M.G. Maloof, W.F. Pepper, George Casey, S.C. Ostroha; and

JOHN DOE, a Conrail trainman or fireman (helper) employee,
Defendants.

All defendants herein are sued personally and in a representative
capacity.

JUDGMENT
(Filed April 7, 1982)

This action having come on for hearing on March 10, 1982, on the
motion of plaintiff Consolidated Raii Corporation (“Conrail”) for
summary judgment and for a permanent injunction, the motion of
defendant United Transportation Union (*UTU”) for summary judg-
ment, the motion of defendants Casey, Connors, Maloof, and L.C.A.
1473 to dismiss the complaint, and the request of defendants J.L.
Arnold and Local Union 1418 that if the Court were to grant injunc-
tive relief it issue a status quo injunction, the issues having been duly
heard and the Court having filed its opinion on March 31, 1982,

IT IS ORDERED, ADJUDGED AND DECREED, in accordance
with that opinion, that § 702 of the Regional Rail Reorganization Act
of 1973, as amended by § 1143(a) of the Northeast Rai! Service Act
of 1981, confers authority on Conrail to take the actions specified in
that section without regard to the Manning Agreement, the Crew
Consist Agreement or any other collective bargaining agreement;
and,

IT IS FURTHER ORDERED, ADJUDGED AND DECREED that
the preliminary injunction entered by the Court on February 22,
1982, is hereby vacated on the ground that no necessity for its
continuance has been shown to exist; and,

IT IS FURTHER ORDERED, ADJUDGED AND DECREED that
the motion for summary judgment of defendant UTU, the motion to
dismiss of defendants Casey, Connors, Maloof, and L.C.A. 1473,

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and request for a status quo injunction of defendants J.L. Arnold and

Local Union 1418 are hereby denied.

/s/ Henry J. FRIENDLY
Henry J. Friendly
Presiding Judge

April 7, 1982

Sa

SPECIAL COURT
REGIONAL RAIL REJRGANIZATION ACT OF 1973

CIVIL ACTION NO. 82-4,
CIVIL ACTION NO. 82-7,
CIVIL ACTION NO. 82-2

UNITED TRANSPORTATION UNION,

Plaintiff
Vv.
CONSOLIDATED RA. CORPORATION,
Defendant
and
CONSOLIDATED Rai. CORPORATION,
Plaintiff
Vv.
UNITED TRANSPORTATION UNION, et al.
Defendants

THOMAS CANNON, ROBERT STILLWELL, DoNALD R. Brewer, and

Davib L. PETERSON, On Behalf of Themselves and all Other Similarly

Situated “Firemen” and “Train Service Employees” Affected by the
Northeast Rail Service Act of 1981,

Plaintiffs
v.

CONSOLIDATED RA. CORPORATION,
Defendant.

(Filed Mar. 31, 1982)

Norton N. Newborn, Esq... (Gaines & Stern Co., L.P.A., Cleveland,
Ohio), for the United Transportation Union

Harry A. Rissetto, Esg., E. Carl Uchlein, Jr., Esg., Thomas E.
Reinert, Jr., Esq. and Donald L. Havermann, Esq., Washington,
D.C. and Dennis Alan Arouca, Esq. and David S. Fortney, Esq.,

6a

Philadelphia, PA, (Morgan, Lewis & Bockius, Washington, D.C.,
‘Of Counsel), for Consolidated Rail Corporation

Elizabeth A. Rodgers, Esq., (Doyle, Playter, Novick & Berkin,
Boston, MA), for UTU Local Committee of Adjustment No. 1473,
Local Chairmen Connors, Maloof and Casey

Ronald L. Gilardi, Esq. and Richard D. Gilardi, Esq., (Gilardi &
Cooper, Pittsburgh, PA), for J.L. Arnold and Local 1418

Cornelius D. Murray, Esq., (O'Connell and Aronowitz, P.C.,
Albany, N.Y., Thomas F. Gleason, Esq., Of Counsel), for Thomas
Cannon, et al.

J. Paul McGrath, Assistant Attorney General, Raymond M. Larizza,
Esq. and Christine Nicholson, Esq., Department of Justice, Wash-
ington, D.C., (John H. Broadley, Chief Counsel and Grady C.
Cothen, Jr., Esq., Federal Railroad Administration, Department of
Transportation, Washington, D.C., Of Counsel), for the United
States as Defendant-Intervenor

FRIENDLY, Presiding Judge:

In this opinion we decide three cases, of which we have jurisdiction
under § 1152(a) of the Northeast Rail Service Act of 1981 (NRSA),
Pub. L. No. 97-35, 95 Stat. 357, relating to § 702 which was added to
the Regional Rail Reorganization Act of 1973 (the RRR Act) by
§ 1143(a) of NRSA. We set forth the entire section in the margin. '

' — § 702(a) GENERAL. — The Corporation may terminate the em-
ployment of certain employees, in accordance with this section, upon
the payment of an allowance of $350 for each month of active service
with the Corporation or with a railroad in reorganization, but in no
event may any such termination allowance exceed $25,000

(b) EMPLOYMENT NEEDS. — Within 90 days after the effec-
tive date of this title, the Corporation shall determine. for each location,
the number of employees that the Corporation intends to separate under
subsection (a) of this section.

(c) NOTIFICATION AND SEPARATION PROCEDURE. — (1)
Within 90 days after the effective date of this title, the Corporation shall
notify its employees of their rights and responsibilities under this
section.

(2) Within 90 days after the effective date of this title, the Corpora-
tion shall notify each train and engine service employee eligible to be

7a

separated under paragraph (3) that such employee may be entitled to
receive a separation payment under this section if such employee files a
written request to be separated. Such notice may be revised from time
to time.

(3) If the number of employees who request to be separated pur-
suant to paragraph (2) of this subsection is greater, in engine service at
any location, than the number of excess firemen at the location, and in
train service at the location than the number of excess second and third
brakemen, as determined by the Corporation, the Corporation shall
separate the employees described in paragraph (2) of this subsection in
order of seniority beginning with the most senior employee. until the
excess firemen and second and third brakemen positions at that loca-
tion, as determined by the Corporation, have been eliminated.

(d) DESIGNATED SEPARATIONS. — If the number of em-
ployees who are separated pursuant to subsection (c)(3) is less at any
location than the number of excess firemen in freight and commuter
service and second and third brakemen in freight service at such
location, as determined by the Corporation. the corporation may, after
210 days after the effective date of this title, de ..znate for separation
employees in engine service or train service respectively in inverse
order of seniority, beginning with the most junior employee in active
service at such location until the excess firemen in freight and commu-
ter service and second and third brakemen in freight service, at that
location have been eliminated. An employee designated under this
subsection may choose (1) to furlough himself voluntarily, in which
case the next most junior employee protected under the fireman mann-
ing Or crew consist agreements or any other agreement or law, in the
same craft or class at such location may be separated instead and
receive the separation allowance, or (2) to exercise his seniority to
another location, in which case the Corporation may separate, under
the provisions of this subsection, the next most junior protected em-
ployee in active service at the location to which seniority ultimately is
exercised.

(e) EFFECT ON POSITIONS. — (1) The Corporation shall re-
frain from filling one fireman position in freight service. or in commu-
ter service where applicable, for each employee in engine service
separated in accordance with this section.

(2) The Corporation may refrain from filing one brakeman posi-
tion in excess of one conductor and one brakeman on one crew in
freight service for each employee in train service who is separated in
accordance with this section.

(3) Positions permitted to be not filled under this subsection shall
be not filled in different types of freight service actually operated at or
from the location in a sequence to be agreed upon between the Corpora-
tion and the general chairman representative of classes or crafts of

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In No. 82-4, filed on February 4, 1982, United Transportation
Union (UTU) sought a judgment declaring that Consolidated Rail
Corporation (Conrail) may sever employees pursuant to § 702 and
fail or refuse to fill vacancies created by the severance of employees
pursuant to § 702 only when such failure or refusal is not inconsistent
with collective bargaining agreements. The complaint brought into
question the inte~>retation of the statute and raised no issue of
unconstitutionality.

On February 22, 1982, Conrail brought No. 82-7 against UTU; its
president F. A. Hardin; 15 UTU General Committees for Adjust-
ment; 19 UTU General Chairmer; 8 UTU Local Unions or Commit-
tees of Adjustment; 11 UTU Local Chairmen; and John Doe, a
Conrail employee. Conra:! sought to enjoin a strike allegedly
threatened by defendants or certain of them to enforce the interpreta-
tion of § 702 which constituted the basis for UTU’s action, No. 82-4.
Conrail contended that its activities were authorized by § 702; it
argued alternatively that defendants’ threatened conduct violated the
Railway Labor Act, 45 U.S.C. § 151 ef seq.. a position no longer

employees having jurisdiction over the positions to be not filled. If no
such agreement is reached, the Corporation may designate the position
to be not filled.

(4) Notwithstanding paragraphs (1) and (2) of this subsection, the
Corporation shall retain all rights it has under any provision of law or
agreement to refrain from filling any position of employment.

(f) PROCEDURES. — The Corporation and representatives of the
various classes and crafts of employees to be separated may agree on
procedures to implement this section, but the absence of such agree-
ment shall not interfere with implementation of the separations autho-
rized by this section.

(g) COMMUTER EMPLOYEES. — The provisions of this sec-
tion shall apply to the separation of firemen in commuter service.
except that with respect to such employces the Corporation is required
to make the separations authorized by this section.

Section 713 authorized $385 000,000 to be appropriated to carry out the
provisions of Title VII, entitled “Protection of Employees”, of which § 702
formed a part. Not more than $115,000,000 was to be available solely for
termination allowances under § 702. Assuming that all terminated em-
ployees would qualify for the $25,000 maximur1 permitted by § 702(a), the
$115,000,000 would provide for 4600 terminations.

Ya

seriously pressed. Conrail requested a temporary restraining order
and, after hearing, a preliminary injunction to be made permanent on
final hearing, and damages. At a hearing on February 22, 1982.
before Judge Thomsen, after he had indicated his intention to issue a
temporary restraining order, it was agreed that a preliminary injunc-
tion should issue and that the case would be finally heard on March
10, 1982, along with No. 82-4, with which it was consolidated. The
parties entered into stipulations of fact in both cases. UTU moved for
summary judgment on the basis of these stipulations. Conrail moved
for summary judgment on the basis of the stipulations and an affidavit
of R. E. Swert, its Vice President, Labor Relations, accompanied by
numerous exhibits. The United States was allowed to intervene in
support of Conrail.

The third action, No. 82-2, Cannon et al. v. Consolidated Rail
Corporation, was brought by two firemen and two brakemen as a
class action on behalf of the class (or sub-class) of Conrail firemen
and train service employees whether presently working or fur-
loughed. The first count of the complaint alleged, as did UTU’s
complaint in No. 82-4, that § 702 should not be interpreted as
permitting violations of the collective bargaining agreements — a
position abandoned by counsel at oral argument (Transcript at 22-
24.) The second count alleged that the provisions of § 702 authoriz-
ing Conrail to force severance and to “blank” positions vacated
thereby in violation of collective bargaining agreements were uncon-
stitutional. The complaint sought declaratory and injunctive relief
and backpay. This court having issued a certificate pursuant to 28
U.S.C. § 2403(a) that the constitutionality of an act of Congress had
been drawn into question, the United States sought and was granted
leave to intervene as a defendant. Both sides moved for summary
judgment. By agreement the case, although not consolidated, was
heard along with Nos. 82-4 and 82-7 on March 10, 1982.

10a

The facts are not in dispute: As required by § 702(b) and (c),
Conrail moved swiftly to implement that section. Although, as dis-
cussions before the legislative committees had indicated, ’ Conrail
intended to use subsection (a) to separate 4600 employees, consisting
of 1300 engine service employees and 3300 train service employees,
it in fact determined that it would initially terminate 3633 employees,
consisting of 1303 engine service employees and 2321 train service
employees, Attachment to Affidavit of R.E. Swert, March 16, 1982,
and gave the notices required by § 702(c\(1) and (2). See Joint
Exhibit H in No. 82-4: Stipulation of Facts D.6 in No. 82-4. On
October 28, 1981, Conrail sought applications for voluntary termina-
tions of 300 engine service and 300 train service employees at 31
locations; 583 employees applied for the former and 1157 for the
latter. (Stipulation of Facts D.11 in No. 82-4; Affidavit of R. E.
Swert, March 4, 1982, § 35.) On or about December 7 Conrail
terminated the employment of the 600 employees and “blanked” their
positions as mandated by § 702(e)(1) or permitted by § 702(e)(2). On
January 7, 1982, Conrail solicited applications for 1660 voluntary
terminations at 54 locations for engine service employees and at 60
for train service employees. (Stipulation of Facts D.13 in No. 82-4.)
A sufficient number of applications having been made, Conrail
terminated that number of employees on or about February 22, 1982.
(Stipulation of Facts D.17 in No. 82-4; Affidavit of R. E. Swert.
March 4, 1982, 4 41-42.) This leaves 2540 employees who may be
terminated and whose positions may be blanked. see footnote |. last
paragraph. Compulsory termination under § 702(d) became possible
on March 10, 1982. The funds for the allowance incident to these
terminations were provided to Conrail under a February 6, 1982
Grant Agreement with the Federal Railroad Administration.

* Explanatory Statement of the House and Senate Conferees with Respect
to Subtitles E, F, and G of Title XI of the Omnibus Reconciliation Bill (H.R.
3982) [hereafter Explanatory Statement}, 127 Cong. Rec. S. 9056, 9060-61
(daily ed. July 31, 1981); Northeast Rail Service Act of 1981, Hearing
before the Subcommittee on Surface Transportation of the Committee on
Commerce, Science, and Transportation, United States Senate, 97th Cong..,
Ist Sess. [hereafter Senate Hearing I] 38, 41-43 (1981) (Comments of
James E. Burke, Vice President, United Transportation Union).

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DISCUSSION
1. The History Of The Problem

The efforts of the nation’s railroads to rid themselves of what they
consider to be unnecessary firemen and second and third brakemen in
freight service have had a long history. See Chicago & N.W.R. Co.
v. United Transportation Union, 402 U.S. 570, 573 (1971) (citing
authorities). This included the appointment of a Presidential Railroad
Commission in 1960 * and of Emergency Board No. 154 in 1963, and
the adoption of a Joint Resolution, 77 Stat. 132, which established a
seven-man tripartite board, Arbitration Board No. 282, which was to
render a binding award effective for two years. * Overmanning be-
came an issue in the Penn Central reorganization, resulting in an
opinion by the reorganization judge which recommended that
management set crew size unilaterally. /n re Penn Central Transpor-
tation Co., 347 F.Supp. 1356, 1367 (E.D. Pa. 1972). After having
invoked the procedures of the Railway Labor Act without success,
the Trustees in February, 1972, began the unilateral reduction of
crews and UTU responded by calling a systemwide strike. Congress
stepped in by enacting Public Law No. 93-5, 87 Stat. 5, which in
effect rescinded the Trustees’ reduction of crew size.

Neither the RRR Act of 1973 nor the RRRR Act of 1976 contained
any provision dealing directly with the problem of overmanning. In
September, 1978, Conrail negotiated a Crew Consist Agreement with
UTU which allowed Conrail to reduce certain freight crews from one
conductor and two brakemen to one conductor and one brakeman;
however, Conrail could eliminate the second brakeman position only

*The Commission recommended that the parties agree to eliminate the
unnecessary positions through attrition, with job protection extended to
present employees; the carriers accepted this proposal but the unions re-
jected it.

* Arbitration Board No. 282 found the fireman position obsolete and
authorized the elimination of all firemen positions subject to restoration of
up to 10% by union officers for engineer training purposes. It remanded the
train service crew consist dispute back to the carriers and unions for local
arbitration. This resulted in eliminating some secor.d brakemen positions but
full implementation was impaired by state full crew laws.

\2a

in the absence of available trainmen with seniority dates prior to the
date of the agreement. The hiring of firemen continued to be governed
by the Fireman Manning Agreement of July 19, 1972. This, in effect,
allowed the carriers to dispense with “firemen-helpers” in engines
other than those in passenger, hostler and hostler-helper service,
keeping an adequate number in training to provide engineers, but
firemen having seniority on the date of the agreement could exercise
this with respect to any position for which the use of firemen would
have been required under the National Diesel Agreement of 1950 as in
effect on January 24, 1964.

While attrition would have gradually eliminated the “protected
employees” under these agreements in time if traffic had grown or
even remained static, traffic declined sharply.* By 1980 it had
become apparent not only to Conrail but to the United States Railway
Administration (USRA) and the General Accounting Office that the
projected savings were not being and would not be realized. ° Indeed,
the overall decline in traffic resulted in an increase in the number of
trains on which Conrail has had to employ firemen. ’

Section 405 of the Staggers Rail Act of 1980, Pub. L. No. 96-448,
94 Stat. 1895, authorized federal funding of a Conrail workforce
reduction program if this would result in “substantial savings” to the
United States. After study Conrail concluded that a severance pro-
gram for train and engine service employees would be generally
beneficial if, but only if, Conrail also could eliminate one position for
every employee separated since otherwise the position vacated would

* See, e.g., Conrail, Options for Conrail, Conrail’s Response to Section
703(c) of the Staggers Rail Act of 1980. at 8-7, 8-A-7 (April 1, 1981):
USRA, Conrail at the Crossroads: The Future of Rail Service in the North-
east, at 10 (April 1981); United States Department of Transportation,
Federal Railroad Administration, Recommendations for Northeast Rail
Service, at C-2 to C-3 (1981).

*USRA, Cost and Productivity — Train and Engine Service. Conrail vs.
Selected Other Carriers — 1980, at 15-43 (1981); Report by the Comptroller
General of the United States, Conrail’s Attempts to Control Labor Costs and
Improve Its Labor Productivity (1980).

’ See authorities cited in note S supra.

I3a

be filled by a protected employee's exercising seniority rights. These
conclusions were reported to the OMB, the FRA, the ICC and the
UTU in January, February, and March 1981. * In all these presenta-
tions Conrail projected a surplus of 1300 firemen and 3300
brakemen.

On March 15, 1981, Conrail made a series of reports to Congress as
required by § 703(c) of the Staggers Act, one of these being “an
analysis of the effects upon the corporation and its employees of
alternative changes in labor agreements and relate? operational
changes.” Conrail, Labor Report to Congress: Response to Staggers
Act Section 703(c), at | (March 15, 1981). The report noted that
Conrail’s freight labor cost ratio had been reduced from 66% in 1977
to 56% in 1981 but that this compared adversely with a ratio of 48%
for the industry excluding Conrail, an annual difference to Conrail of
more than $300 million. /d. Reduction of the ratio would require
heavy sacrifices by Conrail employees, which, however, would be
much less than what would result if Conrail failed to become a viable
carrier and were sold piecemeal to other carriers. /d. The labor
contributions were to consist partly of a $200 million deferral in wage
increases in the 1981 round of collective bargaining and partly by
“elimination of about 10,000 employees and acceleration of savings
permitted by productivity agreements already negotiated.” /d. (Em-
phasis in original; footnote omitted.) ” The report stated that a portion
of the 10,000 reduction in Conrail employees could come from
surplus train and engine employees but that:

current labor contracts, although recognizing that firemen and
second brakemen are not necessary for safe operation, provide
for elimination of these employees only through attrition. It is
clear that normai attrition itself, particularly in the environment
of a declining traffic base, will not reduce Conrail’s work force

* See Exhibits 1, J, and K to Affidavit of R. E. Swert, March 4, 1982.

*A third element was “protection of Conrail against new labor cost
obligations resulting from statutory employee protection requirements or
from collective bargaining or transfer of function or lines to others without
the transfer of involved employees.” Conrail, Labor Report to Congress:
Response to Staggers Act Section 703ic), at 2 (March 15, 1981).

Ida

at a rate necessary for it to realize the benefits of these agree-
ments in the near term.

Early in 1981 negotiations occurred between Conrail and the
unions representing its employees including UTU. These culminated
in a Labor Contribution Agreement dated May 5, 1981. This pro-
vided for changes in the national agreements with respect to wages
estimated to produce savings of $200 million per annum, see, e.g.,
Senate Hearing II, at 35-38 (testimony of James E. Burke, Vice
President, United Transportation Union), 2-3 (testimony of L. Stan-
ley Crane, Chairman and Chief Executive Officer, Conrail), and a
moratorium on the service or processing of notices under § 6 of the
Railway Labor Act. At the same time representatives of Conrail and
of UTU were negotiating with respect to the elimination of firemen
and brakemen positions. According to Swert's affidavit, § 20, this
resulted in the joint submission to the House Committee on Energy
and Commerce and the Senate Committee on Commerce, Science
and Transportation of a proposal generally similar to § 702 as
enacted. '”

2. The Meaning of § 702

UTU argues that § 702, and particularly § 702(d) and (e), were not
intended to allow Conrail to take action contravening the Fireman
Manning Agreement and the Crew Consist Agreement. While its
making the argument is understandable in light of the historic reluct-
ance of both labor and management to have Congress take unto itself
the resolution of labor disputes, we find the argument wholly lacking
in force. Indeed, the plaintiffs in No. 82-2 join with Conrail and the

" Vice President Burke of UTU has submitted an affidavit denying that he
or other union representatives agreed that UTU-Conrail agreements were
superseded by Congressional legislation. [le does not deny Swert’s assertion
that the proposal was jointly submitted and that Conrail understood it would
supersede existing agreements. Review of documents submitted by Conrail,
notably a letter from President Hardin of UTU to General Chairman Doar
dated December 8, 1981, indicates to our mind UTU's then understanding
that § 702 superseded pro tanto the Fireman Manning Agreement and the
Crew Consist Agreement. However, we do not rest our decision on this in
any Gegree.

15a

United States in the view that the section was intended to supersede
contrary agreements.

We look first at the words of the statute, Southeastern Community
College v. Davis, 442 U.S. 397, 405 (1979); Santa Fe Industries,
Inc. v. Green, 430 U.S. 462, 472 (1977), and it is hardly necessary to
do more. The very first sentence of § 702 says that Conrail “may
terminate the employment of certain employees, in accordance with
this section”, not that Conrail may do so if permitted by agreement.
Subsection (d) dealing with involuntary separation says that Conrail
“may, after 210 days after the effective date of this title, designate for
separation employees in engine service or train service respectively in
inverse order of seniority” etc. No qualification is made on the score
of existing agreements. The first reference to representatives of
employees comes in § 703(e)(3), and this for the very limited purpose
there stated and with Conrail having the right to decide if no agree-
ment is reached. Subsection 703(e)(4) retains Conrail’s contract
rights to refrain from filling positions but, significantly, says nothing
about the contract rights of employees. Section § 702(f) says that
Conrail and employee representatives “may agree on procedures to
implement this section, but the absence of such agreement shall not
interfere with implementation of the separations authorized by this
section.” Finally, if there were need for further dotting of i's or
crossing of t's, § 702(g) makes mandatory Conrail’s separation of
firemen in commuter service, which clearly intends no restraint by
existing agreements to the contrary.

The compelling force of the language is augmented by other
considerations discernible from the face of the statute. One is UTU's
inability to suggest what purpose the elaborate provisions of § 702
would serve under its construction. Conrail required no authorization
from Congress to do what existing agreements permitted or to negoti-
ate for changes in them. There can be no valid claim that § 702 was
needed to insure that any actions taken by Conrail of the sort therein

16a

specified would not run afoul of state full crew laws; that office was
already performed by § 711.11

A second consideration is that § 702 must be read in the light of
Title IV which § 1142 of NRSA added to the RRR Act. Section 403
requires USRA to make profitability determinations with respect to
Conrail on June |, 1983, and again as soon after November |, 1983,
as the necessary information is available. Failure of Conrail to pass
either test requires the Secretary of Transportation to initiate dis-
cussions and negotiations under § 405 for the break-up of Conrail’s
freight service, §§ 403(a)(B) and (b)(B). ° It was in the interest of
both Conrail and labor that savings incident to the § 702 program
should begin as early as possible — not await the result of lengthy and
possibly fruitless negotiations fer amendment of the Fireman Mann-
ing and Crew Consist Agreements. '’

With the language of § 702 so clear and the necessity of a literal
reading in order to conform with the overall purpose of the statute to

"$711. No State may adopt or continue in force any law, rule,
regulation, order, or standard requiring the Corporation, the National
Railroad Passenger Corporation, or the Amtrak Commuter Services
Corporation to employ any specified number of persons to perform any
particular task, function, or operations, or requiring the Corporation to
pay protective benefits to employees. and no State in the Region may
adopt or continue in force any such law, regulation, order, or standard
with respect to any railroad in the Region.

"? Fred J. Kroll, Chairman of the Railway Labor Executives’ Association,
testified that a sale of Conrail’s lines to other operators would result in the
loss of more than 40,000 jobs, over half of Conrail’s freight employment.
Consolidated Rail Corporation. Hearings before the Subcommittee on Com-
merce, Transportation, and Tourism of the Committee on Energy and
Commerce. House of Representatives. 97th Cong., Ist Sess.. at 486-87
(1981); Conrail Reauthorization. Hearings before the Subcommittee on
Surface Transportation of the Committee on Commerce. Science. and
Transportation, United States Senate. 97th Cong.. Ist Sess., at 63, 66. 68
(1981).

'" The Supreme Court has characterized the Railway Labor Act's proce-
dures regarding major disputes as “an almost interminable process.” Detroit
& Toledo Shore Line R.R. v. United Transportation Union, 396 U.S. 142,
149 (1969).

17a

manifest, it is scarcely necessary to resort to legislative history. If we
do, the answer given by the reports of the Senate, House and Con-
ference Committees is equally plain.

The House Report on H.R. 3559, a predecessor to NRSA, said
“this title also provides Conrail the opportunity to eliminate
unnecessary jobs. Unneeded firemen and brakemen are eliminated
upon payment of a termination allowance. saving the Corporation
more than $100 million.” H.R. Rep. No. 97-153, 97th Cong.. Ist
Sess., at 3(1981). More specifically. the report described a section of
H.R. 3559, which was almost identical to § 702 as enacted. in the
following terms:

Section 702 permits Conrail to accelerate the implementation of
the crew consist and fireman manning agreements so that all
excess firemen and all second and third brakemen can be elimin-
ated before the end of calendar year 1982. The firemen on the
crews of trains operated in commuter service must be included
by the Corporation in the termination program.

Id. at 30.

The Senate Report described § 413-1! of S.1377, a forerunner of
§ 702, in similar terms:

[Section 413-1] contains a “Special Termination Allowance”
allowing Conrail to “blank” the positions (eliminate the job with
the man) vacated under the program. Separations would be
limited to the numbers of excess firemen and second and third
brakemen (including passenger firemen) presently employed by
Conrail (but not necessarily the individuals occupying those
positions if more senior personnel! wish to be separated). About
4,600 positions are at issue, and their elimination would make
the properties more saleable. This was addressed in the Conrail
settlement after the DOT bill was introduced.

The program would operate at the direction of Conrail but
mandatorily as to affected employees (after voluntary separa-
tions were taken). The section provides for payments at the rate
of $200 per month of active service with Conrail or a predeces-
sor, with a cap of $25,000 (i.e., 4 years, 2 months of service)
[sic].

S. Rep. No. 97-139, 97th Cong., Ist Sess., at 2732 (1981). The House
and Senate conferees took the same view, saying “the purpose of this

Ra

program is to eliminate 4,600 employee position; 3,300 brakemen
and | ,300 firemen. In addition, all the firemen in commuter service
are to be included in this program. This will result in the elimination
of firemen positions in commuter service.” Explanatory Statement,
supra, at 127 Cong. Rec. S. 9061 (daily ed. July 31, 1981); 127
Cong. Rec. H 5962 (daily ed. August 4, 1981).

In none of these statements is there any indication that collective
bargaining agreements were intended to limit the operation of § 702;
indeed, the section was described as allowing Conrail “to accelerate
the implementation of the crew consist and fireman manning agree-
ments.” Likewise, the principal concern reflected in the reports is
ensuring that Conrail actually is able to eliminate the excess positions
in question prior to the end of 1982, an outcome that UTU’s reading
of the provision would be unlikely to permit.

Both Conrail and UTU have referred to a multitude of materials
submitted to Congress in the course of the deliberations leading to the
enactment of § 702. Conrail regards these as showing knowledge by
the committees of Congress that the termination program would not
be effective unless Conrail had the right to enforce it, including the
blanking of positions, irrespective of the assent of the UTU. The latter
finds solace in some references to negotiation by Conrail representa-
tives. We find it unmecessary to pursue the subject. Our concern is not
so much with what Conrail sought as with what Congress wrought.
With respect w that, the language and evident purpose of the statute
and the committee reports leave no room for even the smallest | oubt.
When the evidence revealed by an excursion into materials simply
forming a part of the basis on which Congress acted ts “sufficiently
ambiguous. . . to invite mutually destructive dialectic but not strong
enough either to strengthen or weaken the force of what Congress has
enacted,” a court should disregard it. FCC v. Columbia Broadcasting
System, 311 U.S. 132. 136-37 (1940).

3. Constitutionality:

Due Process And Equal Protection

Plaintiffs in No. 82-2 challenge the con:titutionality of § 702 ona
number of grounds. They contend that the compulsory separation

19a

provisions of § 702(d) and the “blanking” provisions of § 702(e)
violate the Fifth Amendment's prohibitions of the deprivation of
property without due process of law and the taking of private property
for public use without just compensation. They contend also that the
concept of equal protection of the laws held to be embodied in the due
process clause of the Fifth Amendment, see Bolling v. Sharpe 347
U.S. 497 (1954). is violated by § 702(a)’s $25,000 ceiling on
termination allowances and by the fact that § 702 applies only to
Conrail. For convenience we will refer to the two former contentions
as the due process contentions and to the last as the equal protection
contentions.

Before discussing the due process contentions it will be useful to
analyze what sacrifices § 702 in fact imposes and why Congress
imposed them. Clearly the employees who opt for voluntary termina-
tion have no constitutional claim. By no means will every employee
who may be subjected to compulsory termination lose his employ-
ment; if he has seniority, he may exercise this to transfer to another
location. Some, of course, will be terminated, but normally they will
be employees with low seniority, whom Conrail was free to furlough
without benefit of § 702 if their services were not needed. Section
§ 702(e) does not in itself result in the loss of a job; it simply prevents
an employee from using seniority rights to bid for a superior position
formerly held by a terminated employee.

As against this Congress had reason to consider that § 702 would
serve important public objectives. Its purposes, NRSA § 1133, so far
as here relevant, were to provide for “(1 ) the removal by a date certain
of the Federal Government's obligation to subsidize the freight opera-
tions of Conrail” and “(3) an orderly return of Conrail freight service
to the private sector.” The preferred method for accomplishing this
was to make Conrail profitable, thereby permitting its continued
existence or its sale as a single entity to private interests. Failure to
achieve profitability would have catastrophic consequences. Proj-
ected loss of employment from piecemeal sale was estimated to
exceed 45,000. See USRA, Conrail at the Crossroads: The Future of
Rail Service in the Northeast, at 51 (April 1981) and note 12 supra.
This would impair the solvency of the Railroad Retirement System,

20a

see H. Rep. No. 97-153, 97th Cong., Ist Sess., at 153 (1981); S.
Rep. No. 97-101, 97th Cong., Ist Sess., at 105 (1981), recently the
subject of legislative effort to restore its soundness, see Pub. L. No.
97-34, § 741. The new federally funded employee protection pro-
gram, which § 1143(a) of NRSA added as § 701 of the RRR Act,
would be prematurely exhausted, as would the railroad unemploy-
ment insurance fund, see H. Rep. 97-153, supra, at 153.

While § 702 alone could not assure profitability for Conrail, Con-
gress reasonably expecied it to make a significant contribution to
achieving that goal. Annual savings are estimated at $70 million, for
which the Government was willing to supply an estimated $115
million in termination allowances. “ As against this, achievement of
the same reduction in force under existing agreements would require
twice as many terminations and produce savings of only $9 million. '*

Our analysis of the due process contentions must begin by
recognizing that “|vjalid contracts are property, whether the obligor
be a private individual, a municipality, a State or the United States.”
Lynch v. United States, 292 U.S. 571, 579 (1934). However, Con-
gress has greater freedom to deal with private contractual rights than
with obligations of the Federal Government. Contrast Norman v.
Baltimore & Ohio R.R., 294 U.S. 240, 306 (1935), with Perry v.
United States, 294 U.S. 330, 348, 350-51 (1935). As the Court stated
in Norman, 294 U.S. at 307-08:

Contracts, however express, cannot fetter the constitutional
authority of the Congress. Contracts may create rights of proper-
ty, but when contracts deal with a subject matter which lies
within the control of the Congress, they have a congenital
infirmity. Parties cannot remove their transactions from the
reach of dominant constitutional power by making contracts
about them.

'* This assumes that each terminated employee will receive the maximum
of $25,000. See Affidavit of R. E. Lindquist in support of Conrail’s motion
for summary judgment in Nos. 82-4 and 82-7, March 9, 1982.

"Sid.

2la

The principle thus stated in Norman had been settled long before.
Louisville & N. R.R. Co. v. Mottley (11), 219 U.S. 467, 482 (1911),
upheld the invalidation, by the 1906 amendments to the Interstate
Commerce Act of 1887, of a contract settling personal injury claims
of Mr. and Mrs. Mottley for passes during their respective lives. A
unanimous Court, speaking through the first Justice Harlan, said:

That the exercise of [the commerce] power may be hampered or
restricted to any extent by contracts previously made between
individuals or corporations, is inconceivable. The framers of the
Constitution never intended any such state of things to exist.

See also id. at 485-86. Relying on the Mortley decision, the Court in
Philadelphia, Baltimore & Washington R.R. v. Schubert, 224 U.S.
603 (1912), upheld the constitutionality of § 5 of the Federal Em-
ployers’ Liability Act, 35 Stat. 65, which declared void any contract
enabling a carrier to exempt itself from liability under the Act. The
Court said through Justice Hughes, id. at 613-14:

The power of Congress, in its regulation of interstate commerce,
and of commerce in the District of Columbia and in the Territor-
ies, to impose this liability, was not fettered by the necessity of
maintaining existing arrangements and stipulations which
would conflict with the execution of its policy. To subordinate
the exercise of the Federal authority to the continuing operation
of previous contracts, would be to place, to this extent, the
regulation of interstate commerce in the hands of private in-
dividuals and to withdraw from the control of Congress so much
of the field as they might choose by prophetic discernment to
bring within the range of their agreements. The Constitution
recognizes no such limitation. It is of the essence of the dele-
gated power of regulation that, within its sphere, Congress
should be able to establish uniform rules, immediately obligato-
ry, which as to future action should transcend all inconsistent
provisions. Prior arrangements were necessarily subject to this
paramount authority.

Again, in Fleming v. Rhodes, 331 U.S. 100, 107 (1947), the Court
said:

So long as the Constitution authorizes the subsequently enacted
legislation, the fact that its provisions limit or interfere with
previously acquired rights does not condemn it.

22a

More recently, the Court, in Penn Central Transportation Co. v.
New York City, 438 U.S. 104, 124 (1978), although indicating its
inability “to develop any ‘set formula’ for determining when” com-
pensation is required under the taking clause, identified several
factors that have had particular significance in its decisions on the
question. A number of considerations highlighted therein reinforce
our conclusion that § 702 does not effect a taking for which compen-
sation is constitutionally required. One is that “[a] ‘taking’ may more
readily be found when the interference with property can be characte-
rized as a physical invasion by government than when interference
arises from some public program adjusting the benefits and burdens
of economic life to promote the common good.” /d. at 124 (citation
omitted). Another is that “ ‘Taking’ jurisprudence does not divide a
single parcel into discrete segments and attempt to determine whether
rights in a particular segment have been entirely abrogated. . . .
[T}his Court focuses rather both on the character of the action and on
the nature and extent of the interference with rights in the parcel as a
whole... .”/d. at 130-31. Here, as we have pointed out, § 702 by no
means abrogates all rights under the pertinent agreements. Section
702(d) offers the options of a severance allowance, voluntary fur-
lough, or the exercise of seniority at another location. Section 702(e)
merely decreases the total number of jobs available on the system and
thus increases the likelihood that at any given time particular em-
ployees, predominantly those with low seniority, will be on furlough
and decreases the wages of employees working in less desirable
positions. A third consideration is the Court's statement:

Legislation designed to promote the general welfare commonly
burdens some more than others. The owners of the brickyard in
Hadacheck [v. Sebastian, 239 U.S. 394 (1915)], of the cedar
trees in Miller v. Schoene, {276 U.S. 272 (1928).,| and of the
gravel and sand mine in Goldblatt v. Hempstead, |369 U.S. 590
(1962),] were uniquely burdened by the legislation sustained in
those cases. Similarly, zoning laws often affect some property
owners more severely than others, but have not been held to be
invalid on that account.

Penn Central, 438 U.S. at 133-34 (footnote omitted). This is useful in
answering the claim that Congress’ action rises to the level of a taking
because affected workers bear « dispropor ionate share of the burden

23a

of Congress’ scheme to preserve rail service in the Northeast and
Midwest. In contrast to the Penn Central decision, in Kaiser Aetna v.
United States, 444 U.S. 164, 179-80 (1979), where the Court con-
cluded that a taking had occurred because the federal government's
action extinguished the landowner’s right to exclude, which is “so
universally held to be a fundamental element of the property right”.
the Court was careful to note that “the imposition of the navigational
servitude in this context will result in an actual physical invasion of
the privately owned marina. ... And even if the Government
physically invades only an easement in property, it must nonetheless
pay just compensation.” /d. (citations omitted).

As stated in Usery v. Turner Elkhorn Mining Co., 428 U.S. 1, 15
(1976), the Court has long “upheld against due process attack the
competence of Congress to allocate the interlocking economic rights
and duties of employers and employees . . . regardless of contraven-
ing arrangements between employer and employee.” Likewise, the
Court has held that legislation “readjusting rights and burdens” be-
tween employers and employees “is not unlawful solely because it
upsets otherwise settled expectations.” /d. at 16. The statement
applies here a fortiori. Railway labor could hardly have had “settled
expectations” that Congress would forever refrain from doing away
with jobs which a presidential commission had found to be useless
twenty years ago and which the unions, in their collective bargaining
agreements, had in effect conceded to be. As the Supreme Court has
articulated the broad contours of Congress’ power under the Com-
merce Clause, it has become ever more clear that private arrange-
ments will not be permitted to stand in the way. If we assume there are
some limits beyond which Congressional action may not go, certainly
these were not exceeded here.

The equal protection arguments can be disposed of even more
readily. Application of the equal protection concept to invalidate
economic regulation is quite restricted. In the absence of the ex-
istence of “fundamental rights” or invidious discrimination, neither
of which is present here, “i]t is enough that there is an evil at hand for
correction, and that it might be thought that the particular legislative
measure was a rational way to correct it.” Wil'iamson v. Lee Optical
Co., 348 U.S. 483, 488 (1955). “| T]he judiciary may not sit as a

24a

superlegislature to judge the wisdom or desirability of legislative
policy determinations made in areas that neither affect fundamental
rights nor proceed along suspect lines. . . .” New Orleans v. Dukes,
427 U.S. 297, 303 (1976), citing Day-Brite Lighting, Inc. v. Mis-
souri, 342 U.S. 421, 423 (1952).

The attack on the $25,000 ceiling is that it is irrational to apply the
same maximum to an older worker with only a few years of ex-
pectable service and to a younger worker who might have anticipated
many years of employment. "In fact, however, the younger worker's
expectations are dependent on the success of the enterprise. If Con-
rail’s traffic continues to decline or if it should be sold, particularly if
it should be sold piecemeal, seniority rights might make the older
worker's future longer than the younger’s. In addition, a uniform
ceiling is responsive to the fact that younger workers who are sepa-
rated presumably are in a better position to find alternative employ-
ment. Congress was not required to fine tune the maximum separa-
tion allowance to the unpredictable merits of each individual case.

In the area of economics and social welfare, a State does not
violate the Equal Protection Clause merely because the classi-
fications made by its laws are imperfect. If the classification has
some “reasonable basis,” it does not offend the Constitution
simply because the classification “is not made with mathematic-
al nicety or because in practice it results in some inequality.”
Lindsley v. Natural Carbonic Gas Co., 220 U.S. 61, 78.
Dandridge v. Williams, 397 U.S. 471. 485 (1970). See also United
States Railroad Retirement Board vy. Fritz, 449 U.S. 166, 175-79
(1980). The desire to provide a simple. workable maximum on
termination allowances is reason enough.

The equal protection argument based on the tact that § 702 applies
only to Conrail is also unavailing. No other railroad is similarly
situated. Conrail had received subsidies trom the federal government
in excess of $5 billion. In NRSA itself Congress extended further
subordination of the $3.3 billion in federal debt to encourage the sale
of Conrail stock, § 402 of the RRR Act added by § 1142 of NRSA;

'© The $25,000 maximum, of course, has no effect on employees with less
than six years of qualified servic >.

25a

authorized an additional $262 million for the purchase of Conrail
securities, § 217 of the RRR Act added by § 1140(a) of NRSA; and
provided a federally funded labor protection program, §§ 1143 and
1144 of NRSA. Congress determined that in order to justify these
expenditures Conrail must be freed from the provisions of the Fire-
man Manning and Crew Consist Agreements which had prevented its
realizing essential savings by abolishing unneeded positions. The
notion of equal protection embodied in the Fifth Amendment does not
hobble Congress to the choices of doing this for ali railroads or for
none. “|Rjeform may take one step at a time, addressing itself to the
phase of the problem which seems most acute to the legislative mind.
.. . The legislature may select one phase of the field and apply a
remedy there, neglecting the others. The prohibition of the Equal
Protection Clause goes no further than the invidious discrimination.”
Williamson v. Lee Optical Co., supra, 348 U.S. at 489 (citations
omitted). See also New Orleans v. Dukes, supra, 427 U.S. at 306,
overruling Morey v. Doud, 354 U.S. 457 (1957).

4. Constitutionality:
The Bankruptcy Clause

At argument counsel for three UTU local chairmen who are deten-
dants in No. 82-7 contended, on the authority of the Supreme Court's
recent decision in Railroad Labor Executives’ Ass'n v. Gibbons, 50
U.S.L.W. 4258 (March 2, 1982), that because § 702 applies only to
Conraii, it violates Article I, § 8, clause 4 of the Constitution
empowering Congress to “establish . . . uniform Laws on the subject
of Bankruptcies throughout the United States.” On its face § 702,
regulating the employment relations of a non-bankrupt carrier has
nothing to do with bankruptcy, the “subject of the relations beiween
an insolvent or nonpaying or fraudulent debtor and his creditors,
extending to his and their relief.” Wright v. Union Central Ins. Co.,
304 U.S. 502, 513-14 (1938). The constitutional support for § 702,
as indicated by the findings in § 1132, especially § 1132(3), and the
recitals of purposes in § 1133 of NRSA, is the commerce power, not
the bankruptcy power.

The chairmen’s argument rests solely on the tact that § 702 isa part
of Title Vli which § 1143(a) of NRSA added tc the RRR Act. * 1973

26a

as amended. The decision of Congress, simply as a matter of con-
venient reference, to tack Title VII, which has none of the characteris-
tics of bankruptcy legislation, onto the RRR Act did not implicate the
constitutional requirement of uniformity.

5. Injunctive Relief

Having concluded that Congress intended § 702 to operate without
regard to the Fireman Manning Agreement and the Crew Consist
Agreement and that the section as so construed is not unconstitution-
al, and that Conrail has thus proceeded lawfully in implementing
those provisions, we must consider whether to make permanent the
preliminary injunction previously issued in No. 82-7 as Conrail
urges.

We have no doubt that the issue presented in No. 82-7 is a “labor
dispute” within § 13(c) of the Norris-LaGuardia Act, 29 U.S.C.
§ 113(c). It is also plain that § 4 of that Act, 29 U.S.C. § 104, would
prohibit us from issuing the injunction if the Norris-LaGuardia Act is
applicable to our functioning under § 1152 of NRSA.

We think it is not. Section 1152(c) provides that:

Notwithstanding any other provision of law, the special court
shall have original and exclusive jurisdiction over any civil
action — (1) for injunctive, declaratory, or other relief relating
to the enforcement, operation, execution, or interpretation of
any provision or amendment by this subtitle. . . .

It is true that this does not speak with the pristine clarity of § 10(h) of
the National Labor Relations Act, 29 U.S.C. § 160(h), see Bakery
Sales Drivers Local Union No. 33 v. Wagshal, 333 U.S. 437, 442
(1948): Building and Construction Trades Council v. Alpert, 302
F.2d 594 (1 Cir. 1962). The failure of Congress to make specific
mention of the Norris-LaGuardia Act in the “notwithstanding” provi-
sion of § 1152(c) could well have been due to the fact that it wished as
well to exclude the application of other laws. e.g.. the provision of 28
U.S.C. § 1331 vesting the district courts with jurisdiction over cases
arising under laws of the United States. Its omission of express
reference is no reason for failing to read its general words as meaning
what they unmistakably say. Here, as in the case of “minor disputes”

27a

under the Railway Labor Act, 45 U.S.C. § 151 et seq., there must be
an accommodation between the two statutes with the balance favor-
ing the later and more limited one. Virginian Ry. Co. v. System
Federation No. 40, 300 U.S. 515, 563 (1937); Brotherhood of
Railroad Trainmen v. Chicago River & Indiana R.R. Co., 353 U.S.
30, 39-40 (1957); Chicago & N.W. Ry. Co. v. United Transportation
Union, 402 U.S. 570, 582-83 n.18 (1971). The recital of the “public
policy of the United States” in § 2 of the Norris-LaGuardia Act, 29
U.S.C. § 102,"" by which the courts are directed to be guided in
interpreting the act and determining their jurisdiction and authority,
shows how far removed the purpose of that statute is from a case
where Congress itself has set labor policy for a single railroad with
respect to a particular labor problem and vested a special court of
three judges with authority to enforce the Congressional decision by
granting injunctive relief. Compare Boys Markets, Inc. v. Retail
Clerks Union, 398 U.S. 235, 250-53 (1970).

'7§ 102. Public Policy in labor matters declared

In the interpretation of this chapter and in determining the jurisdic-
tion and authority of the courts of the United States, as such jurisdiction
and authority are defined and limited in this chapter, the public policy
of the United States is declared as follows:

Whereas under prevailing economic conditions, developed with the
aid of governmental authority for owners of property to organize in the
corporate and other forms of ownership association, the individual
unorganized worker is commonly helpless to exercise actual liberty of
contract and to protect his freedom of labor, and thereby to obtain
acceptable terms and conditions of employment, wherefore, though he
should be free to decline to associate with his fellows, it is necessary
that he have full freedom of association, self-organization, and
designation of representatives of his own choosing, to negotiate the
terms and conditions of his employment, and that he shall be free from
the interference, restraint, or coercion of employers of labor, or their
agents, in the designation of such representatives or in self-
organization or in other concerted activities for the purpose of collec-
tive bargaining or other mutual aid or protection; therefore, the follow-
ing definitions of and limitations upon the jurisdiction and authority of
the courts of the United States are enacted.

29 U.S.C. § 102.

28a

Although we thus conclude that the Norris-LaGuardia Act does not
bar the injunction sought by Conrail, an injunction should not issue
unless there is “some cognizable danger of recurrent violation.”
United States v. W.T. Grant Co., 345 U.S. 629, 633 (1953). When
the preliminary injunction was issued in No. 82-7, such a danger
plainly existed. Conrail’s complaint alleged (Appendix B) that
UTU’s president had authorized subordinate UTU general commit-
tees to conduct strike votes in connection with Conrail’s implementa-
tion of § 702; that certain such committees had conducted such votes;
and that they and certain UTU local officers and informed Conrail and
the general public that a work stoppage would be conducted. Em-
ployees would report to work on February 22, 1982, and ascertain the
crew or work assignments which they had received. If a crew was
scheduled to operate with a position blanked under the § 702 pro-
gram, it would refuse to work; if Conrail disciplined an employee for
such refusal, a general strike would ensue. The Affidavits of Con-
rail’s Vice-President — Labor Relations, R.E. Swert, and other
Conrail officials in support of its motion for a temporary restraining
order elaborated upon this and on the serious harm which a strike
would cause to Conrail and to the country. Counsel for UTU did not
challenge Conrail’s allegations. Indeed UTU later stipulated that
certain UTU general committees had voted to take strike action
against Conrail in support of UTU’s view that § 702 did not supersede
existing agreements; that UTU was prepared to grant strike authority
to such committees unless enjoined by this court: and that if such
authority was issued some Conrail employees represented by UTU
would strike.

Before this court the defendants in No. 82-7 have contended that
there will be no need for an injunction once we decide the legal issues.
The brief for UTU states (p. 12):

Nevertheless, if this Court rules against the UTU or any appro-
priate appeals decision is against the UTU, the UTU would not
sanction a strike. Thus, the determination of the underlying
dispute will, we believe, moot the Norris-LaGuardia Act issue.

Counsel for UTU said at argument:

If you determine it against us, | think I indicated in our plead-
ings, in our brief to the Court, that the union is not going to defy
the Court and order a strike in violation of the Court's ruling.

29a

Transcript at 10; see also id. at 11. Counsel for local chairmen,
Casey, Connors and Maloof, who had expressed the greatest opposi-
tion to Conrail’s actions, stated:

If you rule [against us]. . . then they won't have a right under
Section 6 to go on strike. . . . As far as | know, they won't. But
they have been completely lawabiding up until this point, and
there is no reason for the Court to believe that they would not
continue to be so.

Transcript at 49-50. Counsel for Local 1418 who spoke briefly was
not asked about this question and did not address it.

In view of these unequivocal representations, which we expect to
be fulfilled, we cannot find that the threat of a strike is now so real or
imminent as to warrant a permanent injunction. It is important,
however, not only that there should be no strike that would directly
frustrate the will of Congress, but also that shippers should perceive
Conrail as being as free as possible from the likelihood of such a
strike. Otherwise the efforts of Congress to enable Conrail to achieve
profitability might be seriously jeopardized. We therefore think it
desirable to alert the parties to our present inclination, in the event that
an illegal strike should be actually threatened, to issue immediately a
temporary restraining order and then to provide Conrail with other
appropriate relief. At this point counsel have not suggested what new
arguments could be made, in the event of renewed threat of a strike,
that would lead us to deny a temporary restraining order or a prelimi-
nary injunction. Our decision should thus not be taken to reflect onthe
appropriateness of injunctive relief when and if a proper showing has
been made that a strike is likely — an event we trust will not occur.
We hold only that at the present time a permanent injunction is not

appropriate.

Judgment will be entered in Nos. 82-4 and 82-7 declaring that
§ 702 added to the RRP Act by § 1143(a) of NRSA confers authority
on Conrail to take the actions there specified without regard to the
Manning Agreement, the Crew Consist Agreement or any other
collective bargaining agreement. Judgment will be entered in No.
82-7 vacating the injunction entered on February 22, 1982, and
denying Conrail’s motion for a permanent injunction. Judgment will

30a

be entered in No. 82-2 rejecting all constitutional challenges to
§ 702. If Conrail desires a more detailed form of judgment, it may
submit one for settlement on five days’ notice.

/s/ Henry J. FRIENDLY
Henry J. Friendly
Presiding Judge

/s/ JOHN MINOR WISDOM
John Minor Wisdom
Judge

/s/ Rosze. C. THOMSEN

Roszel C. Thomsen
Judge

Dated: March 31, 1982

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APPENDIX B

PUBLIC LAW 97-35 — Aug. 13, 1981
95 Stat. 662

“Termination Allowance

“Sec. 702. (a) General. The Corporation may terminate the em-
ployment of certain employees, in accordance with this section, upon
the payment of an allowance of $350 for each month of active service
with the Corporation or with a railroad in reorganization, but in no
event may any such termination allowance exceed $25,000.

“(b) Employment Needs. (1) Within 90 days after the effective
date of this title, the Corporation shall determine, for each location,
the number of employees that the Corporation intends to separate
under subsection (a) of this section.

“(c) Notification and Separation Procedure. (1) Within 90 days
after the effective date of this title, the Corporation shall notify its
employees of their rights and responsibilities under this section.

“(2) Within 90 days after the effective date of this title, the
Corporation shall notify each train and engine service employee
eligible to be separated under paragraph (3) that such employee may
be entitled to receive a separation payment under this section if such
employee files a written request to be separated. Such notice may be
revised from time to time.

“(3) If the number of employees who request to be separated
pursuant to paragraph (2) of this subsection is greater, in engine
service at any location, than the number of excess firemen at the
location, and in train service at the location than the number of excess
second and third brakemen, as determined by the Corporation, the
Corporation shall separate the employees described in paragraph (2)
of this subsection in order of seniority beginning with the most senior
employee, until the excess firemen and second and third brakemen
positions at that location, as determined by the Corporation, have
been eliminated.

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“(d) Designated Separations. If the number of employees who
are separated pursuant to subsection (c)(3) is less at any location than
the number of excess firemen in freight and commuter service and
second and third brakemen in freight service at such location, as
determined by the Corporation, the Corporation may, after 210 days
after the effective date of this title, designate for separation em-
ployees in engine service or train service respectively in inverse order
of seniority, beginning with the most junior employee in active
service at such location until the excess firemen in freight and com-
muter service and second and third brakemen in freight service, at that
location have been eliminated. An employee designated under this
subsection may choose (1) to furlough himself voluntarily, in which
case the next most junior employee protected under the fireman
manning or crew consist agreements or any other agreement or law, in
the same craft or class at such location may be separated instead and
receive the separation allowance, or (2) to exercise his seniority to
another location, in which case the Corporation may separate, under
the provisions of this subsection, the next most junior protected
employee in active service at the location to which seniority ultimate-
ly is exercised.

“(e) Effect on Positions. (1) The Corporation shall refrain from
filling one fireman position in freight service, or in commuter service
where applicable, for each employee in engine service separated in
accordance with this section.

(2) The Corporation may refrain from filling one brakeman
position in excess of one conductor and one brakeman on one crew in
freight service for each employee in train service who is separated in
accordance with this section.

(3) Positions permitted to be not filled under this subsection
shall be not filled in different types of freight service actually operated
at or from the location in a sequence to be agreed upon between the
Corporation and the general chairman representative of classes or
crafts of employees having jurisdiction over the positions to be not
filled. If no such agreement is reached, the Corporation may desig-
nate the position to be not filled.

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“(4) Notwithstanding paragraphs (1) and (2) of this subsection,
the Corporation shall retain all rights it has under any provision of law
or agreement to refrain from filling any position of employment.

“(f) Procedures. The Corporation and representatives of the vari-
ous classes and crafts of employees to be separated may agree on
procedures to implement this section, but the absence of such agree-
ment shall not interfere with implementation of the separations autho-
rized by this section.

“(g) Commuter Employees. The provisions of this section shall
apply to the separation of firemen in commuter service, except that
with respect to such employees the Corporation is required to make
the separations authorized by this section.”

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APPENDIX C

45 U.S.C. § 156

§ 156. Procedure In Changing Rates Of Pay, Rules, And Working
Conditions.

Carriers and representatives of the employees shall give at least
thirty days’ written notice of an intended change in agreements
affecting rates of pay, rules, or working conditions, and the time and
place for the beginning of conference between the representatives of
the parties interested in such intended changes shall be agreed upon
within ten days after the receipt of said notice, and said time shall be
within the thirty days provided in the notice. In every case where such
notice of intended change has been given, or conferences are being
held with reference thereto, or the services of the Mediation Board
have been requested by either party, or said Board has proffered its
services, rates of pay, rules, or working conditions shall not be altered
by the carrier until the controversy has been finally acted upon. as
required by section 155 of this title, by the Mediation Board, unless a
period of ten days has elapsed after termination of conferences
without request for or proffer of the services of the Mediation Board.

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APPENDIX D

45 U.S.C. § 774
§ 774. Collective-Bargaining Agreements

(a) Interim application. Until completion of the agreements pro-
vided for under subsection (d) of this section, the Corporation shall,
as though an original party thereto, assume and apply on the particular
lines, properties, or facilities acquired all obligations under existing
collective-bargaining agreements covering all crafts and classes em-
ployed thereon, except that the Agreement of May, 1936, Washing-
ton, D.C. and provisions in other existing job stabilization agree-
ments shall not be applicable to transactions effected pursuant to this
chapter with respect to which the provisions of section 775 of this title
shall be superseding and controlling. During this period, employees
of the railroad in reorganization who have seniority on the lines,
properties, or facilities acquired by the Corporation pursuant to this
chapter shall have prior seniority roster rights on such acquired lines,
properties, or facilities.

* * * * *

* * * * *

(d) New collective-bargaining agreements. Not later than 60
days after the effective date of any conveyance pursuant to the
provisions of this chapter, the representatives of the various classes of
crafts of the employees of a railroad in reorganization invoived in a
conveyance and representatives of the Corporation shall commence
negotiation of a new single collective-bargaining agreement for each
class and craft of employees covering the rate of pay, rules, and
working conditions of employees who are employees of the Corpora-
tion. Such collective-bargaining agreement shall include appropriate
provisions concerning rates of pay, rules, and working conditions,
but shall not include any provisions for job stabilization resulting
from any transaction effected pursuant to this chapter which may
exceed or conflict with those established herein. Negotiations with
respect to such single collective-bargaining agreement, and any suc-
cessor thereto, shall be conducted systemwide.

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APPENDIX E

SPECIAL COURT
REGIONAL RAIL REORGANIZATION ACT

CIVIL ACTION NO. 82-4

UNITED TRANSPORTATION UNION,
Plaintiff,
Vv.

CONSOLIDATED Ratt. CORPORATION,
Defendant.

PRECIS: STIPULATIONS OF FACTS

The parties by their undersigned attorneys, hereby agree and stipu-
late to the following facts for purposes of this case:

A. Fireman Manning Agreement

A.1. On July 19, 1972, the UTU and certain railroads signed a
collective bargaining agreement, commonly referred to as the “Fire-
man Manning Agreement.” A copy of this agreement is enclosed as
Joint Exhibit A. This agreement, among other things, prescribes a
formula, application of which determines the number of fireman
(helpers) (hereinafter referred to as “fireman”) that a rail carrier must
employ on each seniority district. A copy of a work sheet detailing
application of the formula is enclosed as Joint Exhibit B.

A.2. Included among the rail carriers party to the Fireman Mann-
ing Agreement were various of the rail carriers whose rail properties
were consolidated into Conrail on April |, 1976.

A.3. Pursuant to section 504(a) of the Regional Rail Reorganiza-
tion Act of 1973 (“3R Act”), the Fireman Manning Agreement was
made applicable on the Conrail system. Effective September !, 1981
the agreement developed pursuant to Section 504(d) of the 3R Act
superseded the agreements made applicable pursuant to Section

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504(a), and included therein as Article G-S-12, p. 140, the Fireman
Manning Agreement. A copy of the 504(d) agreement is enclosed as
Joint Exhibit C.

A.4. Under the Fireman Manning Agreement, each hostler posi-
tion and passenger train must have a fireman assigned to it. These
commonly are referred to as “must-fill” positions.

A.5. All other trains or assignments are designated “blankable”
for purposes of the Fireman Manning Agreement. This means that
those trains or assignments to which a fireman does not exercise
seniority may be “blanked,” or operated without a fireman.

A.6. Under Article I, Section 3 of the Fireman Manning Agree-
ment, a rail carrier must make a determination every 3 months of the
number of fireman it must employ in active service on each seniority
district. The number that must be employed is a function of a formula
prescribed by Article I, Section 3 and is derivative of engine service
work experience for the 12 months prior to the date the determination
is made. Once a quarterly determination is made, the number of
firemen that results from the formula must be maintained for the next
3 months, after which the process is repeated. See Joint Exhibit B.

A.7. if the number that results from the quarterly determination
is greater than the number of firemen that the carrier had employed on
that seniority district for the previous 3 month period, the carrier must
recall furloughed firemen, or if no firemen are on furlough, hire
additional employees as firemen. If the number that results from the
quarterly determination is less than the number of firemen that the
carrier had employed on that seniority district for the previous 3
month period, the carrier may furlough that number of employees
representing the difference between the two figures, subject to the
limitation described in paragraph 12.

A.8. After the quarterly determinations are made, and the num-
ber of firemen which must be employed ascertained, employees may
exercise their seniority (or bid) to positions on freight or passenger
trains or crews. If no emplovees bid to “must-fill” positions, the
carrier is entitled to “force” an employee from the position to which
he had bid to the “must-fill” position. This is known as “force’

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assignment and is governed by Article 5-f-3(c), p. 103 of the Conrail-
UTU Firemen (helper) Rules Agreement, a copy of which is enclosed
as Joint Exhibit C.

A.9._ After the bidding and force assignment processes are com-
pleted, the carrier may operate without a fireman any train or crew to
which seniority has not been exercised for a firemen position. This is
known as “blanking” the fireman position on that train or crew.

A.10. Under Article Ill, Section 5 of the Fireman Manning
Agreement, the quarterly determinations of the number of employees
may be superseded if a carrier's business declines within the meaning
of Section 5. In order to ascertain this, the carrier performs another
calculation similar to that performed quarterly, but uses the regular
quarterly determination as a base (hereinafter reffered as the “decline-
in-business formula”). The carrier then applies to the decline-in-
business formula the engine service experience for the previous
consecutive 14 day period. If this 14 day determination results in a
figure more than 15% below the base figure, the carrier has the right
to furlough, in inverse seniority order, those additional employees
that represent the number in excess of the 15%, subject to the
limitation described in paragraph 12. The carrier then continues to
apply the decline-in-business formula for every succeeding consecu-
tive 14 day period, always using as a base the original quarterly
determination used in the first application of the decline-in-business
formula. If the carrier does not experience a more than 15% decline-
in-business in a particular 2 week period, the decline-in-business is
over.

A.11. Since March 31, 1980, Conrail has utilized the decline-in-
business formula of the Fireman Manning Agreement, and continues
to utilize it today. It continues to furlough firemen in excess of 15%
below the base figure arrived at on March 31, 1980, subject to
paragraph 12. This is represented by the chart at Joint Exhibit D
dealing with the time period 6/80 to 2/82.

A.12. Employees on the firemen seniority list, who were in
service on the date of the Firemen Manning Agreement with carriers
that executed the Agreement enjoy special rights under the Agree-
ment. Those employees also commonly are referred to as “protected

42a

employees.” Protected employees may be furloughed only in limited
circumstances described in paragraph 13. Some protected employees
work as engineers, others as firemen. Both groups can remain on
active service as firemen, notwithstanding the quarterly or decline-in-
business determinations, and occupy positions that would otherwise
be vacant or “blanked.” Protected employees who are qualified to
work as engineers, but who are unable to hold engineer positions
because of lack of work, return to work as firemen. As a result a
fireman position is filled that otherwise would have been vacant or
“blanked.”

A.13. Under Article Ill, Section 3 of the Fireman Manning
Agreement, the carrier must maintain an extra list for protected
firemen if there are no firemen positions which these employees can
fill. The extra list requirement does not guarantee the protected
firemen compensation, however it provides employment opportuni-
ties when regularly assigned employees are unavailable or extra work
is assigned. Protected employees may be removed from the extra list
and furloughed only if there is insufficient employment opportunities
as defined in Joint Exhibit C.

A.14. The decline in Conrail’s tratfic, together with the number
of protected firemen on Conrail, has caused the number of crews
operated by Conrail with a fireman to increase over time. This is
represented at Joint Exhibit E.

B. Crew Consist Agreement

B.1. Crew Consist refers to the number of conductors and brake-
men that must be assigned to each freight train or yard crew.

B.2. Pursuant to Section 504(a) of the Regional Rail Reorganiza-
tion Act of 1973, the crew consist agreements of the railroads in
reorganization whose properties were conveyec to Conrail were
made applicable on the Conrail system. These agreements specified
that a standard crew consist was one conductor and two brakemen. In
some states, full crew laws required that Conrail provide third
brakemen.

43a

B.3. In addition to the number of employees required to be
assigned to freight trains or yard crews, there always is an engineer
assigned and often a fireman.

B.4. On September 8. 1978, Conrail and the UTU executed a
crew consist agreement that superseded agreements made applicable
under Section 504(a) of the 3R Act. That agreement, effective
November |, 1978, generally provides that in certain situations
Conrail may operate with a reduced crew consist of one conductor and
one brakeman by not filling or “blanking” the second brakeman
position. When Conrail so operates, productivity savings sharing
allowances, and other economic benefits, are extended to affected
employees. Later, following the United States district court's
determination in Maloof v. Conrail and UTU, (Civ. Action No.
78-3793, E.D. PA 1980), Conrail and UTU executed separate crew
consist agreements for certain regions under various UTU general
committees on the Conrail system which were modeled after the
September 8, 1978 agreement, but which differed in certain respects.
These differences are noted below. All the crew consist agreements
are enclosed as Appendix A to Joint Exhibit F, enclosed herewith.

B.S. Under the 1978 agreement, the standard crew consist of one
conductor and two brakemen continues in effect. However, the
standard crew consist may be reduced by attrition, which is defined to
mean termination of an employee's relationship with Conrail by
death, retirement, resignation, dismissal or severance.

B.6. Employees who held a seniority date in train service on
September 8, 1978 (or January |, 1979 in some cases) are considered
“protected employees” and enjoy certain rights under the crew consist
agreement.

B.7. The crew consist agreement operates as follows: All em-
ployees may exercise their seniority to occupy any available con-
ductor or brakeman positions. All positions are designated “must-
fill” or “blankable.” “Must-fill” positions must have employees
assigned to them. “Blankable” positions are those which can be left
vacant if no employee elects to fill them. If certain “mustfill” posi-
tions are occupied, the carrier may proceed to “blank” second brake-
men positions to which protected ermployees have not bid. Unpro-

44a

tected employees may not exercise their seniority except to “must-
fill” positions, i.e. not to blanked positions or positions that may be
blanked. If they are unable to hold a “must-fill position, they will be
furloughed.

B.8. Generally, the carrier may blank a second brakeman posi-
tion to which a protected employee has not bid on any yard crews and
trains of 70 or less cars (not exceeding 3955 feet). Trains of over 70
cars are considered on some portions of the Conrail system to be
“must-fill” assignments on which second ts :kemen must be em-
ployed. This is commonly referred to as the “car limit restriction.”
However, under certain circumstances the crew consist agreement
authorizes the car limit restriction to be removed or relaxed upon
agreement between Conrail and the UTU General Chairman with
jurisdiction over the territory affected. If the car limit restriction is
removed, or relaxed, second brakeman positions may be blanked
under the procedures described in paragraph 7.

B.9. One of the considerations for execution of the crew consist
agreement was the sharing of savings realized by Conrail from the
blanking of positions with the affected employees. Originally, every
time a train or crew was operated without a second brakeman, Conrail
paid $48.25 into a trust fund which is distributed annually to eligible
employees. Since the crew consist agreement became effective over
$15 million has been distributed or awaits distribution. On certain
portions of the Conrail system, the trusi fund contribution was re-
placed wiih a $22 direct payment to both the conductor and first
brakeman who work as a reduced crew without a second brakeman. In
addition, both employees who worked on a reduced crew receive an
allowance, originally $4, now $5.65, which is revised periodically to
reflect general wage increases and cost of living adjustments. These
payments are in addition to regular compensation.

B.10. The crew consist agreement also extended to train service
employees 2 to 10 paid personal leave days. depending upon years of
service, which days may be taken at any time.

B.11. Certain assignments are exempt from the provisions of the

crew consist agreement and may be operated at all times with one
conductor and one brakeman. T ese are ho urs of service relief crews,

45a

work, construction, wire, snow removal and wreck trains, new busi-
ness Or new service operations, and any assignments that could be
operated without a second brakeman prior to November |, 1978.

C. Effect of Section 702 Of The Regional Rail Reorganization Act

Section 702. as implemented, has resulted in protected trainmen
and firemen losing work opportunities under their union contracts
which may have been available to them if Section 702, as interpreted
by Conrail, had not been enacted.

It is agreed that but for Section 702 Conrail would be prohibited by
UTU agreements from severing involuntarily employees and/or
blanking positions as it is doing under its Section 702 Program.

Respectfully submitted.

/s/ NorTON N. NEWBORN /s/ Harry A. RisseTTo
Norton N. Newborn Harry A. Rissetto
1700 Ohio Savings Plaza 1800 “M”™ Street, N.W.
1801 E. Ninth Street Washington, DC 20036
Cleveland. OH 44114 (202) 872-5084

(216) 781-1700

Attorney for United
Transportation Union

/s/ DENNIS ALAN AROUCA
Dennis Alan Arouca
1138 Six Penn Center
Philadelphia, PA 19103
(215) 977-4999
Counsel for
Consolidated Rail Corporation

464

SPECIAL COURT
REGIONAL RAIL REORGANIZATION ACT OF 1973

CIVIL ACTION NO. 82-4

UNITED TRANSPORTATION UNION,
14600 Detroit Avenue
Cleveland. OH 44107

Plaintiff,
v.
CONSOLIDATED Ratt. CORPORATION,
1138 Six Penn Center Plaza
Philadelphia, PA 19103
Defendant.

STIPULATION OF FACTS

D. Implementation Of Section 702

Plaintiff and Defendant, by their respective attorneys, stipulate the
following facts to be true and correct:

D.1. After the August 13, 1981 enactment of NERSA, Conrail
Vice President-Labor Relations, R E. Swert. and other Conrail repre-
sentatives met with various UTU representatives to discuss the imple-
mentation of Section 702. On or about August 19, 1982 the first of
these meetings took place in Conrail’s Washingtow, D.C. office. On
behalf of the UTU, Vice President J. E. Burke, Vice President L.
Wotaszak, and W. Mahoney, attended and at this meeting. the
representatives generally discussed the meaning of the terms,
“seniority.” “notice” and “location” under Section 702.

D.2. On or about September 10, 1981 the UTU representatives
again met with Swert and other Conrail representatives. At this
meeting, Swert provided the UTU representatives with maps indicat-
ing the locations for the Section 702 program. It was agreed that a
meeting would be held to permit the UTU General Chairmen to have
input on the definition of “location” and t» review the Section 702
program.

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D.3. On or about September 15, 1981, Swert and Conrail repre-
sentatives met with the UTU General Chairmen. At this meeting, the
implementation of Section 702 was discussed and a draft of a series of
Questions and Answers describing the implementation of Section
702, which was to be provided to all of Conrail’s train and engine
service employees, also was reviewed.

D.4. Onor about October 5, 1981 Swert and Conrail representa-
tives again met with UTU General Chairmen. The final plans for the
implementation of Section 702 were discussed and the General Chair-
men were provided with estimates of the number of excess train and
engine service employees, by location within their respective senior-
ity districts.

D.5. Following the October 5, 1981 meeting with the UTU
General Chairmen, Conrail forwarded to them a final copy of the
Questions and Answers for UTU General Chairman discussed during
the previous meetings. A true and accurate copy of these Questions
and Answers is attached as Joint Exhibit G. Conrail also provided a
copy of the materials, which included a letter from R. E. Swert, Vice
President-Labor Relations and a Question and Answer package, that
were sent to all Conrail train and engine service employees on
October 16, 1981. True and accurate copies of the Swert letter to the
train and engine service employees and the Question and Answer
package are attached as Joint Exhibit H.

D.6. On or about October 28, 1981 Conrail posted notices at
thirty-one locations across its system seeking applications for a Sec-
tion 702 separation allowance from train and engine service em-
ployees at those locations (hereinafter referred to as the “October 28
Notice”). The October 28 Notice required applications to be post-
marked by November 12, 1981.

D.7. UTU International President F. A. Hardin sent a letter
dated November 9, 1981 to J. J. Kenefick, UTU General Chairman.
A true and accurate copy of this letter is attached as Joint Exhibit I.

D.8. UTU General Chairman C. P. Jones sent a letter dated
November 20, 1981 to F. A. Hardin, UTU International President. A
true and accurate copy of this letter is attached as Joint Exhibit J.

48a

D.9. On or about November 20, 1981 Conrail and the United
States Railway Association (“USRA”) executed a grant agreement to
transfer $15 million, which previously was appropriated, for Conrail
to implement the workforce reduction program pursuant to Section
702. A true and accurate copy of this November 20, 1981 Grant
Agreement is attached as Joint Exhibit K.

D.10. On or about November 25, 1981 Conrail notified in writ-
ing 300 train service and 300 engine service employees of the accept-
ance of their applications submitted pursuant to the October 28 Notice
and advised them that the effective date for their termination would be
the end of their tour of duty which commenced December 7, 1981.

D.11. Onor about December 7, 1981 Conrail (a) terminated the
employment relationship of the 600 train and engine service em-
ployees whose applications were accepted pursuant to the October 28
Notice; and (b) blanked a corresponding number of train and engine
service positions at the 31 locations from which applications were
accepted.

D.12. UTU International President F. A. Hardin sent a letter
dated December 8, 1981 to R. E. Doan, UTU General Chairman. A
true and accurate copy of this letter is attached as Joint Exhibit L.

D.13. On or about January 7. 1982 Conrail posted additional
notices soliciting employee applications pursuant to the Section 702
Program at 60 locations for train service employees and 54 locations
for engine service employees on its system (hereinafter referred to as
the “January 7 Notice”). The January 7 Notice required applications
to be postmarked by January 17. 1982.

D.14. On or about January 14. 1982 Conrail and UTU General
Chairman E. T. Adkins executed an agreement amending the Crew
Consist Agreement. As to his Committee Side Letter No. 3 to the
January 14, 1982 agreement from R. E. Swert discussed the effect of
the amendment on the implementation of Section 702. A true and
accurate copy of Side Letter No. 3 is attached as Joint Exhibit M.

D.15. On February 6, 1982 Conrail and the United States of
America, represented by the Secretary of Transportation, acting
through the Administrator of the Federal Railroad Administration,

49a

executed a grant agreement for the transfer of the $100 million
appropriated for use under Section 702 by the Department of Trans-
portation and Related Agencies Appropriations Act for 1982, Public
Law No. 97-102. A true and accurate copy of the February 6, 1982
Grant Agreement is attached as Joint Exhibit N.

D.16. Pursuant to the February 6 Grant Agreement, on February
10, 1982, Conrail notified approximately 1,660 train and engine
service employees of the acceptance of their applications pursuant to
the Section 702 Program and advised them that the effective date for
their termination would be the end of their tour of duty which
commenced on February 22, 1982.

D.17. On or about February 22, 1982 Conrail (1) terminated the
employment relationship of approximately 1,660 employees whose
applications were accepted; and, (2) blanked a corresponding number
of train and engine service positions at the locations from which the
applications were accepted.

D.18. Conrail will continue to blank up to 4,600 firemen and
brakemen positions equal to the number of employees severed under
Section 702.

S0a

If sufficient voluntary severances are not obtained, Conrail will
sever involuntarily firemen and brakemen employees.

Respectfully submitted,

/s/ NortTON N. NEWBORN /s/ Harry A. RIsseTTo
Norton N. Newborn Harry A. Rissetto
1700 Ohio Savings Plaza 1800 “M” Street, N.W.
1801 E. Ninth Sireet Washington, DC 20036
Cleveland, OH 44114 (202) 872-5084

(216) wit /s/) DENNIS ALAN AROUCA
Attorney for United Dennis Alan Arouca

Transportation Union 1138 Six Penn Center
Philadelphia, PA 19103
(215) 977-4999
Counsel for
Consolidated Rail Corporation

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Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40385008_1645%3A2. Public record. Not legal advice.