“We’re hearing more and more that shippers and railroads are getting anxious,” said John Drake, vice president for transportation policy, infrastructure and supply chain at the U.S. Chamber of Commerce. The chamber is calling on the two sides to reach an agreement that averts the first national rail strike in 30 years.
The unions and the National Railway Labor Conference, which represents management at the bargaining table, met with federal mediators and US Labor Secretary Martin Walsh on Wednesday to see if they could reach a deal. Unions said there was no progress.
Freight railroads have generally thrived during the pandemic, so a key dispute is not pay but rules that control worker scheduling. Many of the engineers and conductors who make up the two-man crews of each train must be “on call” to report to work seven days a week, preventing them from making their own plans, depriving them of time with their families and creating a high turnover rate.
Time is running out
Because railroad workers are under a different labor law than that which governs labor relations at most companies, it is possible that Congress could act to prevent or quickly stop a strike. But that would require a level of bipartisanship that is rare in Washington just weeks before midterm elections. President Joe Biden avoided a strike two months ago by imposing a cooling-off period during which a panel he appointed, known as the Presidential Emergency Board (PEB), examined contentious issues in the negotiations and issued a recommended solution.
That 60-day cooling-off period will expire at 12:01 a.m. ET on Sept. 16, and Biden does not have the power to prevent a strike at that time. Only Congress can act to prevent a work stoppage, either by imposing a deal on the two sides or by extending the current cooling-off period.
The PEB recommended multiple annual increases until July 2020, when the previous contract was set to expire.
They would give workers an immediate 14 percent raise, as well as additional back pay for hours worked since 2020. There would be more increases in the future, resulting in a 24 percent pay increase over the five years of the contract that would run from 2020 to 2024, as well as annual cash bonuses of $1,000.
The PEB’s wage recommendations are slightly less than what the unions were asking for, and slightly more than what management had previously offered.
But it was lucrative enough that five of the smaller unions representing more than 21,000 rail workers agreed to a tentative labor agreement based on the panel’s recommendations, although they still need to be ratified by their rank-and-file members to enter. effect And the PEB’s wage recommendations would surely have been enough to win approval from the other unions, even though they are asking for more.
“We’re not going to sit here and argue [wages] or healthcare. We’re beyond that,” said Jeremy Ferguson, president of the union representing the drivers, one of two freight train workers along with engineers.
Anger at work rules
The directors’ union and six other unions about to go on strike, which includes the one representing engineers, are not satisfied with the work rules recommendations, and how the “on-call” requirement will affect the quality of life of their members, denying them gratuity. time with their families even when they are away from work.
Unions are calling on congressional allies not to act, arguing that a strike is the only way to reach a deal that can improve what they say are intolerable labor rules that are driving employees out of business, causing staff shortages and well-documented service issues in freight. railway service
“The fact is that they [the railroads] they’re counting on Congress to act,” said Dennis Pierce, president of the Society of Locomotive Engineers and Trainers. “We let them [the union’s allies in Congress] we know we need them to stay out.”
“This is an opportunity for Democrats to stand up for something they say they stand for, the working class and working people,” Ferguson said.
Will Congress act?
If Congress acts, it would present a difficult policy choice for the Biden administration. Biden is as pro-union as any president in history, but he doesn’t want to see any problems for supply chains, prices and the economy ahead of crucial midterm elections.
Asked about the risk of a strike, a White House official did not address the possibility of congressional action, instead stressing the need for a negotiated settlement to avoid a shutdown he hopes to avoid.
“After the pandemic and supply chain disruptions of the past two years, now is not the time for more uncertainty and disruption,” the official told CNN’s Betsy Klein.
The official said the White House “stands ready to support the parties as they work toward an agreement or a voluntary extension of the cooling-off period.”
“We take no position on what the elements of an agreement should be,” added the official. “We are confident that the parties will make every effort to negotiate in good faith toward a mutually acceptable solution, and we urge both parties to do so promptly.”
Democrats in Congress could impose a contract more to the unions’ liking than the one recommended by the presidential panel. But that could have trouble getting the necessary Republican support to pass. Republicans could potentially benefit if there was a protracted rail strike that caused problems for the economy just before the election, especially if Democrats could be blamed.
Even some companies that would like to see the dispute resolved without a strike are nervous about going to Congress.
“Frankly, it’s not a good sign if it eventually goes to Congress,” said one business official closely monitoring the possibility of a strike, who spoke on condition that his name not be used.
“You don’t know what you’re going to get. You could have members who could hold up legislation to demand one thing or the other. . . . Once Congress gets involved, it’s a mess.”
This executive believes Congress will kick the can, extending the cooling-off period, perhaps past Election Day, rather than imposing a contract. But this is still not a solution.
“Here’s the problem, it’s been 30 days since the [presidential panel’s] recommendations Only five of the 12 railway unions have signed the recommendations,” he said.
Right now, the railroads are still asking unions to accept the terms recommended by the presidential panel, rather than asking Congress to act.
“It is in the best interest of all stakeholders and the public that railroads and railroad labor organizations quickly reach agreements that provide wage increases to employees and prevent disruptions to rail service,” the National Railway Labor Conference said “Now is time to use it.” the PEB’s recommendation as a basis for a quick and voluntary agreement.”
The railroad trade group released an estimate Thursday that shutting down freight rail service would cost the U.S. economy $2 billion a day. He did not specifically call for congressional action, encouraging the parties to resolve the dispute through negotiations, though his statement said that “Ultimately, Congress has the power to intercede and prevent a shutdown.”
Record profits for the railways
The strike threat comes as several railroads, including Union Pacific ( UNP ), Norfolk Southern ( NSC ) and Berkshire Hathaway’s ( BRKA ) Burlington Northern Santa Fe have reported record earnings.
Unions argue that companies are making profits off the backs of their employees, creating conditions that are driving workers to quit. Employment at the nation’s major railroads has fallen by more than 30,000, or about 20 percent of the workforce, since the last contract was reached in 2017.
Union leaders say their members are now at a breaking point and are eager to strike to win change.
“This is not a personal choice of the union presidents,” said Pierce, president of the engineers union. “Our accession has made it very clear that this is not an agreement that we would ratify.”
— CNN’s Betsy Klein contributed to this report