Passenger Trains > Boardman's March 28 Message to Employees

I'm not sure what he's really asking for...
============================================

March 28, 2014

A Message from Joe Boardman

> Dear Co-workers,

> We are a “can do” company. So many of you work so hard to deliver
> great customer service and world class safety. Your work is helping
> to increase ridership and improve our financial position.
>
> We are a private company that receives payments from, and has
> important relationships with, nearly 50 sovereign governments. The
> largest is the United States government, but we also receive very
> large payments from California, Illinois, Michigan, New York,
> Virginia, North Carolina, Washington, Oregon and 38 other states for
> which we provide some level of service.
>
> Our bosses – our customers, the states who hire us to provide
> service, the Congress, the administration, our board of directors and
> ultimately the taxpayers - expect us to run the corporation as much
> like a business as we can. We’ve made progress in that direction, but
> more needs to be done.
>
> Here’s the problem. Our expenses are too high and our revenue is too
> low. We have great opportunities to become better as a place to work,
> better in the service we deliver and better in our control of our own
> future. However, we continue to struggle with overhead costs,
> overtime costs and lack of efficiencies.
>
> Our average hourly wage for agreement employees is $28.86. That’s a
> just wage, a living wage, and whenever possible, an annual wage. I’m
> proud that we are able to offer wages that attract well qualified
> employees, often multiple generations from the same family looking
> for a career with our company.
>
> Last year we paid agreement employees and non-agreement employees
> $1.3 billion in straight time pay and salary. Eligible employees
> earned another $184 million in overtime. This does not include health
> insurance, payroll taxes or retirement. Through February of FY14,
> Amtrak’s total payroll (including all benefits and taxes) is 93.6
> percent of Amtrak’s ticket revenue. The company cannot sustain this
> level of payroll or overtime going forward
>
> Corporate overhead costs of $508 million are high as well and we need
> to find a way to slow the pace of spending. Corporate overhead
> includes departments such as Marketing, Information Technology,
> Procurement, Real Estate, Finance and even my department, Office of
> the President and CEO.
>
> We will lose our position as the preferred provider of rail passenger
> service in this nation if we do not find better solutions to reduce
> our costs and increase our revenues. Everyone is accountable,
> agreement and non-agreement. You and me.
>
> It was not so long ago that Amtrak had nearly a dozen contracts to
> operate or maintain equipment to support service for commuter rail
> agencies, including large ones like MBTA in Boston. Today we have
> five. In 2009, we lost VRE in Virginia. Was that a wake-up call? It
> was for me and I was only here a short time at that point.
>
> Then in we lost Caltrain in California (SIC).
>
> We have a full round of 19 state supported service contracts coming
> up soon. I’m not sure right this minute how we will do on those.
> Recently the state of Connecticut was questioning if it would be
> Amtrak or Metro-North Railroad that would operate the Springfield
> Line when their new service begins in 2015-- and we own the track.
>
> We need to examine and look at everything. We need to ensure that we
> are doing the right things at the right times. We need to be lean and
> compete because I hate to lose. I like to win, and I know you do too.
> I believe we owe it to our future to win. We can continue to upgrade
> our equipment and our facilities and add good jobs, but in order to
> do that we need to look at every cost and look for every opportunity
> to increase revenue. We need to follow our Strategic Plan.
>
> It is time for all of us to wake up and understand that we are in a
> very competitive environment. We will not only survive, but we will
> clearly win with the strategy we have and by embracing and living our
> values to each other and to all of our customers. Thank you for all
> you do to help this railroad serve our customers. Please take part in
> ensuring that we pay our debt to the future by engaging in the vision
> and the hard work it will take to stay in front of the growing list
> of competitors who would like to take away our business and jobs.

Sincerely,
Joe Boardman
President and CEO

GenePoon Wrote:
-------------------------------------------------------
> I'm not sure what he's really asking for...
> ============================================
>
> March 28, 2014
>
> A Message from Joe Boardman
>
> > Dear Co-workers,
>
> > We are a “can do” company. So many of you
> work so hard to deliver
> > great customer service and world class safety.
> Your work is helping
> > to increase ridership and improve our financial
> position.
> >
> > We are a private company that receives payments
> from, and has
> > important relationships with, nearly 50
> sovereign governments. The
> > largest is the United States government, but we
> also receive very
> > large payments from California, Illinois,
> Michigan, New York,
> > Virginia, North Carolina, Washington, Oregon and
> 38 other states for
> > which we provide some level of service.
> >
> > Our bosses – our customers, the states who
> hire us to provide
> > service, the Congress, the administration, our
> board of directors and
> > ultimately the taxpayers - expect us to run the
> corporation as much
> > like a business as we can. We’ve made progress
> in that direction, but
> > more needs to be done.
> >
> > Here’s the problem. Our expenses are too high
> and our revenue is too
> > low. We have great opportunities to become
> better as a place to work,
> > better in the service we deliver and better in
> our control of our own
> > future. However, we continue to struggle with
> overhead costs,
> > overtime costs and lack of efficiencies.
> >
> > Our average hourly wage for agreement employees
> is $28.86. That’s a
> > just wage, a living wage, and whenever possible,
> an annual wage. I’m
> > proud that we are able to offer wages that
> attract well qualified
> > employees, often multiple generations from the
> same family looking
> > for a career with our company.
> >
> > Last year we paid agreement employees and
> non-agreement employees
> > $1.3 billion in straight time pay and salary.
> Eligible employees
> > earned another $184 million in overtime. This
> does not include health
> > insurance, payroll taxes or retirement. Through
> February of FY14,
> > Amtrak’s total payroll (including all benefits
> and taxes) is 93.6
> > percent of Amtrak’s ticket revenue. The
> company cannot sustain this
> > level of payroll or overtime going forward
> >
> > Corporate overhead costs of $508 million are
> high as well and we need
> > to find a way to slow the pace of spending.
> Corporate overhead
> > includes departments such as Marketing,
> Information Technology,
> > Procurement, Real Estate, Finance and even my
> department, Office of
> > the President and CEO.
> >
> > We will lose our position as the preferred
> provider of rail passenger
> > service in this nation if we do not find better
> solutions to reduce
> > our costs and increase our revenues. Everyone is
> accountable,
> > agreement and non-agreement. You and me.
> >
> > It was not so long ago that Amtrak had nearly a
> dozen contracts to
> > operate or maintain equipment to support service
> for commuter rail
> > agencies, including large ones like MBTA in
> Boston. Today we have
> > five. In 2009, we lost VRE in Virginia. Was that
> a wake-up call? It
> > was for me and I was only here a short time at
> that point.
> >
> > Then in we lost Caltrain in California (SIC).
> >
> > We have a full round of 19 state supported
> service contracts coming
> > up soon. I’m not sure right this minute how we
> will do on those.
> > Recently the state of Connecticut was
> questioning if it would be
> > Amtrak or Metro-North Railroad that would
> operate the Springfield
> > Line when their new service begins in 2015-- and
> we own the track.
> >
> > We need to examine and look at everything. We
> need to ensure that we
> > are doing the right things at the right times.
> We need to be lean and
> > compete because I hate to lose. I like to win,
> and I know you do too.
> > I believe we owe it to our future to win. We can
> continue to upgrade
> > our equipment and our facilities and add good
> jobs, but in order to
> > do that we need to look at every cost and look
> for every opportunity
> > to increase revenue. We need to follow our
> Strategic Plan.
> >
> > It is time for all of us to wake up and
> understand that we are in a
> > very competitive environment. We will not only
> survive, but we will
> > clearly win with the strategy we have and by
> embracing and living our
> > values to each other and to all of our
> customers. Thank you for all
> > you do to help this railroad serve our
> customers. Please take part in
> > ensuring that we pay our debt to the future by
> engaging in the vision
> > and the hard work it will take to stay in front
> of the growing list
> > of competitors who would like to take away our
> business and jobs.
>
> Sincerely,
> Joe Boardman
> President and CEO

Let the sniping begin!

Cut management down to 1 in 33 employees like you were suppose to would help and where cost cuts should start. How many vice presidents, assistants, route managers, supervisors, customer service supervisors, AARSA, or whatever hell else they call a manager these days does this company have? You just hired 40 new Customer Service Managers and then put out this letter. They cut down quite a bit of the OBS staff (a.k.a true frontline employees) already. That wage amount seems like a average, but what is it after two tiers of Railroad Retirement, paying for their own benefits, union dues, and taxes? Probably much lower than that for OBS. I think the managers are hoping the employees to strike, so they can cut their wages down for a bigger bonus.

Ptolemy Wrote:
-------------------------------------------------------
> GenePoon Wrote:
> -------------------------------------------------- -----
> > I'm not sure what he's really asking for...

> Let the sniping begin!

I have one small request for you Ptolemy.

Could you starting trimming the quoted text to be commensurate with your snarks? It will be easier for me to see them.

(snip)
>
> March 28, 2014
>
> A Message from Joe Boardman
>
> > Dear Co-workers,
>
> > We are a “can do” company. So many of you
> work so hard to deliver
> > great customer service and world class safety.
> Your work is helping
> > to increase ridership and improve our financial
> position.
> >
> > We are a private company that receives payments
> from, and has
> > important relationships with, nearly 50
> sovereign governments. The
> > largest is the United States government, but we
> also receive very
> > large payments from California, Illinois,
> Michigan, New York,
> > Virginia, North Carolina, Washington, Oregon and
> 38 other states for
> > which we provide some level of service.
> >
> > Our bosses – our customers, the states who
> hire us to provide
> > service, the Congress, the administration, our
> board of directors and
> > ultimately the taxpayers - expect us to run the
> corporation as much
> > like a business as we can. We’ve made progress
> in that direction, but
> > more needs to be done.
> >
> > Here’s the problem. Our expenses are too high
> and our revenue is too
> > low.

(snip)
> >
> > We will lose our position as the preferred
> provider of rail passenger
> > service in this nation if we do not find better
> solutions to reduce
> > our costs and increase our revenues. Everyone is
> accountable,
> > agreement and non-agreement. You and me.
> >
> > It was not so long ago that Amtrak had nearly a
> dozen contracts to
> > operate or maintain equipment to support service
> for commuter rail
> > agencies, including large ones like MBTA in
> Boston. Today we have
> > five. In 2009, we lost VRE in Virginia. Was that
> a wake-up call? It
> > was for me and I was only here a short time at
> that point.
> >
> > Then in we lost Caltrain in California (SIC).
> >
> > We have a full round of 19 state supported
> service contracts coming
> > up soon. I’m not sure right this minute how we
> will do on those.
> > Recently the state of Connecticut was
> questioning if it would be
> > Amtrak or Metro-North Railroad that would
> operate the Springfield
> > Line when their new service begins in 2015-- and
> we own the track.
> >
> > We need to examine and look at everything. We
> need to ensure that we
> > are doing the right things at the right times.
> We need to be lean and
> > compete because I hate to lose. I like to win,
> and I know you do too.
(snip)

-----------

It's a petty clear letter.

We (all of Amtrak) need to get our costs down, and our revenues up.
We (all of Amtrak) have had our butts kicked on several contract losses, and will likely lose more contracts
We (all of Amtrak) have way too many poor performers, shops, execs, etc at all levels

Very consistent with what's been said and written several times before, by Boardman.



Edited 1 time(s). Last edit at 03/29/14 13:29 by Lackawanna484.

1. Take the flowers out of the dining cars
2. Defer maintenance on locomotives and cars
3. Spend $200 million on wi-fi technology that is obsolete
4. Hire a fleet of taxi-cabs to drive crews out to the middle of nowhere and dump them
5. Purchase downtown hotels to put up stranded passengers when freight trains blow airhoses 5 minutes ahead of a scheduled passenger train
6. Take out host railroad sidings in more places, scrap the rails, and use to build a new headquarters annex
7. Build a $10 trillion dollar tunnel under the Hudson River
8. Convert a $10 trillion dollar post office into a train station in New York City
9. Invest in postive train control systems that don't work and for which no equipment is available

GenePoon Wrote:
-------------------------------------------------------
> I'm not sure what he's really asking for...
> ============================================
.
Deus ex machina?

Lurch_in_ABQ Wrote:
-------------------------------------------------------
> GenePoon Wrote:
> --------------------------------------------------
> -----
> > I'm not sure what he's really asking for...
> > ============================================
> .
> Deus ex machina?

That a good one, but I think he has been told that Congress is not going have any part of that.

Simply said as United Airlines told its employees, salaries cut 20 percent and no pension plans. Expect the same for Amtrak employees

WAF Wrote:
-------------------------------------------------------
> Simply said as United Airlines told its employees,
> salaries cut 20 percent and no pension plans.
> Expect the same for Amtrak employees

That's what I'm thinking. He's starting to prepare them for a cut in salaries. Boy! If I could have made a minimum of $28 per hour, (over $1100 per week!) and knew I'd have the medical problems I've got now, I wouldn't have to worry about trying to get help with medicare.

gambletrainman Wrote:
-------------------------------------------------------
> WAF Wrote:
> --------------------------------------------------
> -----
> > Simply said as United Airlines told its
> employees,
> > salaries cut 20 percent and no pension plans.
> > Expect the same for Amtrak employees
>
> That's what I'm thinking. He's starting to prepare
> them for a cut in salaries. Boy! If I could have
> made a minimum of $28 per hour, (over $1100 per
> week!) and knew I'd have the medical problems I've
> got now, I wouldn't have to worry about trying to
> get help with medicare.

I don't know how they get to the $28, but it doesn't appear to include company contributions to a pension plan, or the company's share of health insurance, employer's share of payroll taxes, state assessments, unemployment, etc. Figure another 30% for that, or about $36 an hour.

Given the very small % of Amtrak's employees who are not collectively represented, they could probably cut salaries to zero and not move the needle much on total payroll cost.

Looks more like Greyhound than UAL. You can't expect the employees to subsidize the cheap seats.

sphogger

I saw this about 25 years ago. He is just preparing the craft employees for a wage freeze and increase in medical costs. I am not sure about the other crafts but the clerks contract expires in June of 2015. So the rumors will begin. In Oregon and Washington I have already been hearing those states are shopping for another operator (they are not real serious at this point)and also a different area for a repair facility in Seattle. The problem is there is no land close to the Seattle facilities for a different company to do the repairs for the Cascades. Much of the land that is available has been spoken for, for the new basketball arena in Seattle. As for a different operator I would like a definition for this on the jobs that would be taken over. Amtrak seems to be doing OK with the Sounder mechanical but still has difficulty with the Cascades at times in Seattle.

As for overtime, a tremendous amount is being spend on late trains, AKA the train 27/28 and 7/8 the Empire Builder. I did hear that management did take a 15% pay cut in the last 8 months. So I can see at the minimum a wage freeze and increase in medical for the craft employees. I don't think the craft employees will accept a wage freeze on the increase in medical until the bonus for managers is on the table or is permanently put to rest. I don't know if the bonus is true or not but most employees believe it is true.

> >
> > We are a private company

No, Amtrak is not a private company. It's de-facto owned by the federal government.....how is it "private" in any sense of the word??

that receives payments
> from, and has
> > important relationships with, nearly 50
> sovereign governments. The
> > largest is the United States government, but we
> also receive very
> > large payments from California, Illinois,
> Michigan, New York,
> > Virginia, North Carolina, Washington, Oregon and
> 38 other states for
> > which we provide some level of service.

Does he know what the term "sovereign" even means?? A government of a US state is sovereign in no real ways....

ep75 Wrote:
-------------------------------------------------------
> Cut management down to 1 in 33 employees like you
> were suppose to would help and where cost cuts
> should start. How many vice presidents,
> assistants, route managers, supervisors, customer
> service supervisors, AARSA, or whatever hell else
> they call a manager these days does this company
> have? You just hired 40 new Customer Service
> Managers and then put out this letter. They cut
> down quite a bit of the OBS staff (a.k.a true
> frontline employees) already. That wage amount
> seems like a average, but what is it after two
> tiers of Railroad Retirement, paying for their own
> benefits, union dues, and taxes? Probably much
> lower than that for OBS. I think the managers are
> hoping the employees to strike, so they can cut
> their wages down for a bigger bonus.


You took the words right out of my mouth.

He is asking for employees to take massive cuts to pay and pensions, just like corporations have demanded from most other sectors of the economy. It seems pretty clear to me.|

Edit: "asking" is the wrong word. He is warning that such cuts will be coming, whether employees like it or not. How many unions are currently working without a contract at Amtrak?



Edited 1 time(s). Last edit at 03/29/14 17:46 by inCHI.

> March 28, 2014
>
> A Message from Joe Boardman
>
> > Dear Co-workers,
>
> > ... Through February of FY14, Amtrak’s total payroll (including all benefits> and taxes) is 93.6
> > percent of Amtrak’s ticket revenue....

From March 18, 2014 news release:

"We have taken a very careful approach so that we can keep operating costs down,
and operating revenues up, resulting in a cost recovery that has continued to rise, reaching 89% in FY 2013,
and a projected 91% by FY 2015 ...."

Link to news release:

http://www.amtrak.com/ccurl/412/537/Amtrak-FY2015-Federal-Budget-Request-ATK-14-028,0.pdf

Amtrak would improve its credibility with almost everyone, if it would lose that bogus cost recovery factor.

Reportedly Indiana has issued an RFP (Request for Proposal) to open up competition for an operator of the rail service there. Amtrak needs to control costs or face losing state contracts to other agency operators.

It can no longer be business as usual for Amtrak. It's time to re-calibrate. Boardman's message seems to be a wake up call to employees.

If revenue is too weak, carry out some PIP plans that enhance more revenue than cost, such as the C-L and CZ and stop wasting time counting coach pillows and Astor chocolate squares.

As usual with Amtrak, victim mentality trumps everything.

Wasn't the recent restructuring within the company supposed to help this?