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Return In VW Union Vote

ACWI ADVANCE | Volume 4, Issue 1 | January 15, 2016

2016-01-15_12-51-38Since being adopted in 2011, the National Labor Relations Board decision allowing unions to organize a small number of employees within a facility as “micro units” has seen surprising little use by labor organizers, but that may be changing.

In December a small unit of maintenance workers at the Volkswagen plant in Chattanooga, TN, voted to be represented by the United Auto Workers. The unit, which makes up only about 10% of the 1,400 production and maintenance workers, voted 108-44 to unionize.

VW is appealing an earlier ruling by an NLRB regional director that allowed a vote to go ahead. “This appeal sets the stage for a possible legal battle for years to come,” says attorney Tim Garrett of the law firm of Bass, Berry & Sims PLC.

The decision to challenge the vote represents a turnaround for VW, which previously had sought to smooth the way for the UAW, both before and after both management and the union were surprised by a company-wide vote rejecting the UAW in 2014.

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Poll Finds Trucking Safe and Essential

A national poll conducted by American Trucking Associations found the public continues to believe professional truck drivers are among the safest drivers on the road and that trucking is essential to the American economy.

“Our industry invests more than $7 billion each year in safety tools, technologies and practices, and this poll tells us those investments are working,” said ATA President Bill Graves.

“Americans believe trucks move the most freight and that our drivers are safe and getting safer,” he added. “Those facts beliefs are not just correct, they are important to keep in mind when debating important safety issues.”

An overwhelming majority of those polled, 63%, believe trucks move most of the nation’s goods – a three-point increase from 2014.

Sixty percent of respondents said they have a favorable view of the trucking industry, the highest among transportation modes.

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STB, Opponents Rain on CP-NS Merger

2016-01-15_12-56-06The Surface Transportation Board appears to have undermined one of the chief arguments of Canadian Pacific’s case for its proposed acquisition of Norfolk Southern. At the same time opposition to the merger from elected officials, shippers and two labor unions has grown.

The NS board of directors has rejected three offers from CP, in part because it contends that STB approval of such a merger two giant railroads is highly unlikely (AA, 12-31-15, P. 4).

A key component of the CP merger plan involves placing the railroad in a voting trust to be approved by the STB. Assuming that the board would approve the trust idea, CP’s current CEO Hunter Harrison would then run NS while having no involvement in the direct management of CP.

CP’s position is that STB approval of such a trust should be a slam dunk because it has done so many times in the recent past. (NS responded that there is nothing preventing CP from seeking STB approval before an acquisition proceeds any further.)

Not so fast, says the STB in a letter responding to concerns raised by Rep. Rob Goodlatte (R-VA), chairman of the House Judiciary Committee, and Rep. Tom Marino (R-PA), chairman of that committee’s subcommittee on Regulatory Reform, Commercial and Antitrust Law.

“The board has not approved that particular arrangement in the context of a proposed merger between two Class I railroads,” the STB said of the voting trust idea put forward by CP.

In a 1998 proposed major merger involving the Canadian National and Illinois Central, Hunter Harrison (now CEO of CP) left his position as CEO of IC, the acquisition target, to become Chief Operating Officer of the purchasing company, CN.

“However, neither the board’s staff opinion on the voting trust, nor the agency’s subsequent decision approving the merger addressed any proposed management shift,” the STB said.

The board also said at this time it would “take a much more cautious approach” to voting trusts in proposed major mergers because the board is now required to conduct a more formal review of such voting trusts, including a public comment period.

In addition to its focus on whether a voting trust insulated the merger partners from unlawful pre-approval control, since the 1998 CN-IC decision the board has adopted new merger rules that up the ante. Under these rules the board also will consider a new factor in assessing voting trusts in major mergers: whether use of the trust would be consistent with the public interest.

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