Next week’s massive rail strike could deal another blow to the US economy

“We’re hearing more and more about shippers and railroads,” said John Drake, vice president of transportation, infrastructure and supply chain policy at the US 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.

Unions and the National Railroad Conference, which represents the administration at the negotiating table, met with federal mediators and US Labor Secretary Martin Walsh on Wednesday to see if they can move closer to a deal. The unions said there was no progress.

Freight railroads in general have boomed during the pandemic, so the main disagreement is not over wages, but rather the rules that control worker scheduling. Many of the engineers and conductors who make up the two-person crew on each train must be “on call” to come to work seven days a week, which prevents them from making their own plans, deprives them of time with their families and creates high turnover.

time is running out

Since railroad workers are subject to a different labor law than that which governs labor relations in most companies, it is possible that Congress could act to prevent or stop a strike quickly. But that will require a level of bipartisanship that was rare in Washington just weeks ago midterm elections.
President Joe Biden hit blocked Two months ago, by imposing a cooling-off period, during which an appointed committee, known as the Presidential Emergency Board (PEB), considered the disputed issues in the negotiations and issued a recommended settlement.

The 60-day cooling off period is set to expire at 12:01 a.m. ET on September 16, and Biden does not have the strength to prevent a strike at that time. Only Congress can act to prevent a stoppage, either by forcing a deal on both sides or to extend the current lull.

PEB has recommended several annual increases going back to July 2020, when the previous decade was to expire.

It will give workers an immediate 14% raise, as well as an additional salary for their hours since 2020. There will be more increases in the future, resulting in a 24% wage increase over five years of the contract that would from 2020 to 2024. Plus, an annual cash bonus of $1,000.

The House’s wage recommendations are somewhat lower than what unions have requested, and somewhat more than the administration has previously offered.

But it was profitable enough that five of the smaller unions representing more than 21,000 rail workers agreed to temporary work deals based on the commission’s recommendations, though they still needed to be endorsed by their regular members to get into them. Effect. Perhaps the wage recommendations of the general board were enough to win the approval of the other unions, even though they were asking for more.

We won’t sit here and argue [wages] or health care. “We’re further afield,” said Jeremy Ferguson, president of the union that represents conductors, one of two freight train workers alongside engineers.

Anger at work rules

The conductors union and the other six unions are preparing to strike, including the union Representing engineers, who are not satisfied with the recommendations of the work rules, and how the “on-call” requirement will affect the quality of life of their members, depriving them of any free time with their families even when they are off work.

Unions are urging allies in Congress not to act, arguing that a strike is the only way to hammer out a deal that could improve what they say are intolerable labor rules that push employees to quit, causing staff shortages and shipping well-documented service problems. railway service.

“The truth is [the railroads] Dennis Pearce, president of the Brotherhood of Locomotive Engineers and Training Men, said, “They depend on Congress to move. We let them [the union’s allies in Congress] I know we want them to stay away from him.”

“This is an opportunity for Democrats to stand up for something they say they support, the working class and workers,” Ferguson said.

Will Congress act?

If Congress does move, it will present a difficult political 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 before the crucial midterm elections.

When asked about the risks of the strike, a White House official did not address the possibility of congressional action, stressing instead the need for a negotiated settlement to avoid the 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 that the White House “stands ready to support the parties as they seek an agreement or a voluntary extension of the de-escalation period.”

“We do not take a position on what the elements of the agreement are,” the official added. “We are confident that both sides will do everything in their power to negotiate in good faith a mutually acceptable solution, and we urge both sides to do so promptly.”

Congressional Democrats can impose a contract more to the satisfaction of unions than recommended by the presidential committee. But this may struggle to obtain the Republican support necessary to pass it. Republicans could benefit if a prolonged rail strike causes problems in the economy just before the election, especially if Democrats can be blamed.

Biden Avoids Freight Rail Strike — For Now

Even some companies that want to settle the dispute without striking are wary of going to Congress.

“Quite frankly, it wouldn’t be a good sign if you eventually go to Congress,” said a trade official who closely monitors the possibility of a strike, speaking on condition of anonymity.

“You don’t know what you’re going to get. You could have members who can disrupt legislation to demand one thing or the other… Once Congress steps in, there will be chaos.”

This executive believes that Congress will send the can on the right track, extending the cooling-off period, perhaps past Election Day, rather than imposing a contract. But this is still not a solution.

“That’s the problem, it’s been 30 days since [presidential panel’s] recommendations. Only five of the twelve railroad unions signed up to the recommendations.”

At this point, railroads are still urging unions to agree to terms recommended by the presidential committee, rather than calling on Congress to act.

“It is in the interest of all stakeholders and the public that rail and rail organizations expeditiously reach agreements that provide wage increases to employees and prevent disruptions to rail service,” the National Rail Workers Conference said. The board’s recommendation as a basis for a speedy and voluntary agreement.”

The railroad trade group released an estimate Thursday that halting rail freight service would cost the US economy $2 billion a day. Congress did not specifically demand action, and encouraged the parties to settle the dispute through negotiations, though in his statement, “Ultimately, Congress has the power to mediate and avoid shutdown.”

Record profits for railways

The threat of a hit comes as many railways come, including Union Pacific (UNP)And the Southern Norfolk (National Security Council) And the Berkshire Hathaway (puddles) Burlington Northern Santa Fe posted record profits.

Unions argue that companies make profits on the back of their employees, and create conditions that cause workers to quit. Employment on the country’s major railways has fallen by more than 30,000, or about 20% of the workforce, since the last decade was reached in 2017.

Union leaders say their members are now at breaking point and are eager to strike to win changes.

“This is not a personal choice by union leaders,” said union chief Pierce. “Our membership has made it clear and loud that this is not a deal that membership will endorse.”

– CNN’s Betsy Klein contributed to this report

Leave a Comment