This is a determination
of the Railroad Retirement Board on reconsideration
of the status of Chicago Heights Switching
Company (CHSC) as an employer under the Railroad
Retirement Act (45 U.S.C. § 231 et seq.)
(RRA) and the Railroad Unemployment Insurance
Act (45 U.S.C. § 351 et seq.) (RUIA).
On November 21, 2002, in Board Coverage Decision
(B.C.D.) 02-84, the Board held CHSC to be
an employer under the Acts based on its providing
rail-switching operations within Bulkmatic
Distribution Center at Chicago Heights, Illinois
as an agent for Bulkmatic Railroad Corporation
(BRC). BRC is a Surface Transportation Board
(STB)-authorized rail carrier unaffiliated
with CHSC. BRC has been held by the Board
to be a covered employer under the Acts (B.C.D.
No. 02-39), B.A. No. 4411.
In its request for reconsideration, CHSC
submits that it is a private carrier which
does not hold itself out to the public generally.
CHSC claims that it has never provided rail
service as a rail common carrier and has not
operated pursuant to the exemption for rail
operation issued by the STB. Instead, CHSC
reports that BRC is providing rail service
at the Bulkmatic Distribution Center as a
common carrier by rail.
The Bulkmatic Distribution Center is operated
by Bulkmatic Transport Company pursuant to
a long-term lease from Pork Chop Limited Partnership.
Bulkmatic Transport Company is a motor common
carrier and participates in the truck portion
of the transportation that takes place after
the transloading operation at the Distribution
Center. The rail trackage at the Distribution
Center is subleased by Bulkmatic Transport
Company to BRC. That trackage connects with
trackage owned and operated by Union Pacific
Railroad and by Elgin, Joliet &
Eastern Railroad Company. BRC has undertaken
the common carrier responsibility for rail
operations at the Bulkmatic Distribution Center.
CHSC provides rail service at Bulkmatic Distribution
Center pursuant to an agreement with BRC.
Pursuant to that agreement, CHSC provides
rail service for Bulkmatic Transport Company
only, and does not provide services to any
other company or individual1.
The information submitted regarding CHSC is
supported by a Notice of Exemption, which
was filed with the Surface Transportation
Board and issued March 7, 2002 (STB Finance
Docket Number 34179), and provided to the
Board in connection with the request for reconsideration,
and an affidavit by Don L. Gibson, President
of CHSC. The STB decision in Finance Docket
No.34179 noted that an exemption granted to
CHSC in Finance Docket No. 34146 had not been
consummated and that BRC would be the operator
of the line in question.
A majority of the Board finds that the additional
evidence submitted in connection with CHSC’s
request for reconsideration indicates that
CHSC provides rail-switching operations only
as a private carrier. Accordingly, a majority
of the Board finds that the Board’s
previous decision regarding Chicago Heights
Switching Company should be reversed and holds
that that company is not an employer within
the meaning of section 1(a)(1)(i) of the Railroad
Retirement Act and the corresponding provision
of the Railroad Unemployment Insurance Act.
One additional aspect of this case must be
considered. Under the “Scope of Work,
Compensation and Billing Procedure”
contained in Appendix 2 of the contract between
CHSC and BRC, CHSC is required to furnish
a locomotive engineer and railroad switchman
“to provide railroad switching service
as agent of [BRC] and in the name of [BRC]
at the Bulkmatic Distribution Center. * *
*” Any CHSC employee who provides service
as a locomotive engineer or railroad switchman
to BRC, a covered rail carrier under the RRA
and RUIA, is an employee of BRC with respect
to such service and the compensation paid
for it. Such service and compensation must
be reported to the Board.
