The transfer switch might have a light or audible signal informing you that there is line power detected.
An automatic transfer switch will just return the electrical to its normal state and you might not even notice the transfer.
In my case I just kept an eye on the traffic lights in the intersection across the street. When they started working again I knew power was back on in the area.
Neutrals should never be switched, and are required by code to be grounded at (and only at ) the service entrance. A generator that is grounded is connected to all the neutrals in the neighborhood. One connection does not a complete circuit make, so this poses no danger to linemen.
How do you figure?
If there is an unbalanced load you’ll have current on the neutral. AND if your ground at your service is less then optimal (or compromised) you could see a condition where that unbalanced load could see it’s way to the earth ground at the transformer and/or someone working on that line between your house and the transformer.
The current on the neutral will exist between the generator and the load. The Neutral is unswitched, and common to all customers on a given transformer. It is (supposed to be) grounded at the transformer and at each customer’s service entrance.
The neutral current would only “see it’s way” to distant grounding point if the hot side of the generator supplied circuit were grounded at comparable or lower resistance than the neutral side’s (compromised) ground. Unless the neutral run provides a reasonably low resistance path back to the hot side, there is no reason for current to flow in that branch. If there is even a high resistance ground on the neutral side, and none on the hot side, neutral will stay within a few volts of ground. Not a threat to our lineman.
So to produce voltage on the neutral beyond the service entrance requires:
1)A fault to ground on the hot side of the generator/load circuit. This fault must either be to something other than a safety ground protected frame, or the safety ground circuit must be seperate from neutral at the service entrance (code violation) This requires either a three wire device run off a two wire circuit, or a massivly defective duoble insulated device.
2)A poor or nonexistant ground.(code violation) at the service entrance. Note that these connections are required to be mechanically protected between the service entrance and the ground rod.
3)A lineman working on the customer side of the transformer. This will most likely require that the customer call the electric company, so the customer will need to leave the generator gerry rigged when they know the power company is on the way, and lineman Opal needs to ignore the noise when she arrives on site.
4)An open neutral between the generator and a non-compromised grounding point, or ALL grounds bad on the neutral circuit.
5)A non-grounded generator. Pretty likely, but contrary to code and the instructions that come with them.
Sure, all these things could happen. And opening the neutral does avoid this remote possibility. But then a switch used to break the neutral connection could also arc track from the mud daubers that nested there since it was last used.
Note that electricians routinely work on the customer side with the neutral connected to the service. This is exactly as dangerous as the scenerio you discribe, except that the neighbor’s (sharing the same transformer) “generator” is the electric company. Actually they are far more likely to be in the grounding path than a lineman, as linemen normally take precautions NOT to be grounded.
The biggest threat to linemen from a generator backfeeding it drives back through the transformer, energizing the (broken) distribution lines at 6.2KV or higher. In order for this to happen, there must be at least two connections between the generator and the transformer. A single connection the the center tap (neutral) on the secondary won’t do it.
How should the generator be grounded? It is next to the pumphouse about 50’ away from the meter.
Good to hear of another doper in my neck of the woods. I’m in Fort Wayne…and we’ve gone from freezing rain with a high of 1 degree to 55 degrees today. It’s exhausting to live here.
Yep. If it weren’t for stupid, I wouldn’t have a job. If stupid were excluded, we could give insurance away. 
Actually it was up to the low sixties today. I spent the day out at my Mom’s near Leo cleaning up branches.
I’m in FW also.