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FRA to issue final rule affecting railroad contract workers

WASHINGTON — The Biden administration recently announced a slew of actions it plans to take aimed at improving rail safety in the wake of the Norfolk Southern train derailment in East Palestine, Ohio.

But depending on an upcoming decision from the Federal Railroad Administration, the industry could instead be taking a step backward, according to railroad unions.

That decision — which FRA plans to publish in May, according to the latest regulatory agenda issued by the U.S. Department of Transportation — involves a provision included in a rule that went into effect in April 2020 that requires each Class I freight railroad put in place an FRA-approved Risk Reduction Program (RRP). The goal of the rule is to improve safety.

The provision in the rule, part 271.3(c), states that if a railroad “contracts out significant portions of its operations, the contractor and the contractor’s employees performing the railroad’s operations shall be considered directly affected employees” for purposes of the RRP.

The Association of American Railroads filed a petition to reconsider several aspects of the rule days before it went into effect in 2020, including the contractor provision.

“AAR understands that for certain passenger railroads, the entirety of the railroad’s operations may be contracted out,” AAR stated in its petition. “However, this is certainly not true for Class I freight railroads. Including this new requirement in the rule applicable to freight railroads, and doing so without corresponding safety justifications or notice and opportunity to comment, is arbitrary and unreasonable.”

The railroads requested FRA amend the rule “by deleting inclusion of employees of contractors as ‘directly affected employees.’”

FRA agreed to reconsider the contractor aspect of the rule, and two years later, in September 2022, it published a notice of proposed rulemaking (NPRM) on whether to retain or remove the provision. While the agency believes the contractor provision should be retained, “FRA may issue a final rule removing 271.3(c) and making any necessary conforming changes … in response to public comment,” it stated in the NPRM.

Unions warn of safety risks

An attorney representing the transportation division of the International Association of Sheet Metal, Air, Rail and Transportation Workers (SMART), a union made up of thousands of railroad engineers, conductors, trainmen, switchmen and yardmasters, said it would be a mistake for FRA to remove or alter the contractor provision as it is written.

“The bottom line is the railroads have reduced employment significantly and have hired contractors to replace them,” Larry Mann, president of the law firm Alper & Mann, P.C., told FreightWaves.

“In my view, whatever job those contractors do, they must comply with all the regulations when they’re working anywhere on the rail system — there should not be any exemption from rail safety laws. If they’re doing the same work railroad employees would be doing, and if the risk reduction aspects are not followed, there are safety implications there.”

In comments filed with FRA responding to the NPRM, Greg Hynes, SMART’s national legislative director, asserted that excluding contractors would be “blatantly inconsistent” with the goal of improving safety.

“If accidents and injuries are preventable via implementation of documented procedures set forth by the carriers’ RRPs, there is no safety benefit to excluding contracted employees from these protections,” the union stated.

The Brotherhood of Railroad Signalmen (BRS), which represents 10,000 employees responsible for inspecting, installing, repairing and maintaining signal systems and highway-rail grade crossing for all Class I railroads, commented in the NPRM that the contractor provision is necessary for closing the safety gap that exists when railroads hire contractors — and it would be “very counterproductive” to rescind it.

“The contractors are subject to railroad operating rule qualifications prior to being granted permission to work on the property,” stated BRS President Michael Baldwin. “Whether the contracting company is in charge or the Class I, the same rules should be applied for the RRP. The BRS rejects AAR’s petition and requests the FRA do the same in order to continue to protect the public and the employees on a constant basis.”

AAR: Contractor provision should be clarified

In AAR’s own comments filed on the NPRM in November, Stephen Gordon, AAR’s associate general counsel for safety, suggested that section 271.3(c) should be amended rather than removed entirely from the RRP regulation. He contends that terminology used in the provision “is undefined and does not lend itself to a clear and precise meaning.” 

“FRA needs to clarify the scope and effect of 271.3(c) so that railroads can appropriately plan for and ensure compliance in the event that a contractor must be treated as a directly affected employee,” Gordon said. 

AAR recommends that a contractor may only be considered “operationally significant” if it is performing more than 50% of the work for a particular function. As an example, Gordon theorized that if a railroad hired a contractor to perform 20% of its flagging operations, then the contractor would not meet the “operationally significant” threshold. But a contractor performing 60% of the flagging operations potentially would be treated as a directly affected employee, he asserted.

“This makes practical sense for at least two reasons,” Gordon stated. “First, it provides regulatory certainty by clearly identifying the threshold concerning the extent of the work required. Second, it sets the threshold at a reasonable level to ensure that contractors who are treated as directly affected employees have the requisite knowledge and experience on the railroad to contribute to the RRP.”

Union to seek post-accident protections

The 243-page RRP rule, which took 12 years to finalize, allows each railroad to tailor the RRP to its specific operations. It also requires railroads to conduct an annual assessment of their plans.

But Mann, a rail safety expert who helped draft the Federal Railroad Safety Act of 1970, pointed out when the rule was finalized in 2020 that while railroad management is required to consult with the rail workers, they don’t have to accept what the railroad workers propose to help mitigate risks.

He also noted that information a railroad compiles to plan or evaluate an RRP is protected from discovery in a proceeding for damages involving personal injury, wrongful death or property damage.

A federal court challenge after the RRP rule came out was unsuccessful, he said, however, “we still have a lot of issues with the rule. If there’s an accident, and a railroad is aware of a safety problem that caused it, why shouldn’t we be able to alert a jury about it?”

As a member of the FRA’s Rail Safety Advisory Committee, Mann said he plans to bring up the rule and his continuing concerns at an upcoming committee meeting.

Click for more FreightWaves articles by John Gallagher.