Union Pacific 2002 Annual Report Download - page 70

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OTC transports a variety of products including machinery, tobacco, textiles, plastics, electronics and paper products. Motor
Cargo is a western regional LTL carrier that provides comprehensive service throughout 10 western states. Motor Cargo
transports general commodities, including consumer goods, packaged foodstuffs, industrial and electronic equipment and
auto parts. OTC and Motor Cargo experience intense service and price competition from regional, inter-regional and
national LTL carriers and, to a lesser extent, from truckload carriers, railroads and overnight delivery companies. Major
competitors include US Freightways and CNF Inc. OTC and Motor Cargo believe they are able to compete effectively in their
markets by providing high quality, customized service at competitive prices.
Employees – During 2002, OTC continued to oppose the efforts of the Teamsters to unionize OTC service centers. On
February 11, 2002, the United States Court of Appeals for the Fourth Circuit, sitting as a full panel, refused to enforce four
bargaining orders issued by the National Labor Relations Board (NLRB) that would have required OTC to bargain with the
Teamsters, even though the Teamsters lost secret ballot elections. Subsequently, the NLRB moved for a judgment against
itself to reverse the seven other bargaining orders it had issued, and the Fourth Circuit entered that judgment. On October
11, 2002, the NLRB’s General Counsel dismissed a charge the Teamsters had filed in August 2001 alleging that OTC had been
bargaining in bad faith. OTC has not reached any collective bargaining agreement with the Teamsters. On October 24, 2002,
the Teamsters ended the national strike they had called against OTC three years earlier.
The Teamsters’ eight-year campaign to organize OTC’s service centers has become almost entirely dormant, and since
October 2002, the Teamsters have lost rights to represent 41% of the approximately 2,100 employees they had organized. The
Teamsters had become the bargaining representative of the employees at 26 of OTC’s 170 service centers, but the employees
at 17 of these locations recently have voted to decertify the Teamsters, and the NLRB has officially approved the votes in 14
of those locations. Decertification petitions are pending at four other service centers. Only a single representation petition
currently is pending, but due to strike violence charges pending against the Teamsters, the NLRB has blocked the Teamsters’
efforts to precipitate an election. In all, the Teamsters currently represent approximately 10% of OTC’s 12,534 employees.
Employees at two Motor Cargo service centers located in North Salt Lake, Utah and Reno, Nevada, representing
approximately 11% of Motor Cargo’s total work force at 33 service centers, are covered by two separate collective bargaining
agreements with unions affiliated with the Teamsters. Although the agreements cover most of the employees at these two
facilities, less than half of these covered employees are actual members of unions.
Other Product Lines
Other – Included in the other product lines are the results of the corporate holding company, self-insurance activities,
technology companies, and all appropriate consolidating entries.