On July 15, President Joe Biden blocked a freight railroad strike in Omaha, Nebraska. This strike would disrupt the fragile supply chain by delaying the shipment of goods for at least 60 days.
To combat this, President Biden appointed a board of arbitrators, the Presidential Emergency Board, to help the dispute with contract building and negotiation mediation.
The appointed Presidential Emergency Board gave the 12 unions involved a 124-page report outlining their suggested terms.
One of the biggest suggestions was a 24% raise for the 115,000 rail workers.
Three of the 12 unions announced a five-year deal on Aug. 29, which covers more than 15,000 members of the International Association of Machinists, Transportation Communications Union, and Brotherhood of Railway Carmen.
Two of the biggest rail unions have yet to reach any sort of deal that their members would agree with. These unions primarily represent engineers and conductors.
The railroads need to come up with an agreement by September 16 or federal law would allow the unions to go on strike.
Congress is likely to step in should this happen since a strike of this magnitude would crack the already broken supply chain.
On Sept. 9, ATA sent a letter to Congress asking for them to step in, which they are allowed to do if no agreement is made.
“Idling all 7,000 long-distance daily freight trains in the U.S. would require more than 460,000 additional long-haul trucks every day, which is not possible based on equipment availability and an existing shortage of 80,000 drivers,” ATA President Chris Spear said in the letter. “As such, any rail service disruption will create havoc in the supply chain and fuel inflationary pressures across the board.”
Should this matter become a congressional issue, Congress would have the option to mandate all railroad employees to return to work under the Federal Railway Labor Act.
“It has become clear in our post-Presidential Emergency Board negotiations with the rail carriers that they are counting on the federal government to come to their aid if we are unable to reach a tentative agreement, and so far, we have not reached an agreement.” Sheet Metal, Air, Rail, and Transportation Union President Jeremy Ferguson and Brotherhood of Locomotive Engineers and Trainmen President Dennis Pierce said.
In the past, the unions made joint requests as a coalition, but now each union has made individual terms for its members to vote upon.
CSX, Union Pacific, BNSF, Norfolk Southern, and several other railroads are represented by the National Carriers Conference Committee in the talks.
“It is critical for all stakeholders, including customers, employees, and the public, that all parties promptly resolve the negotiations and prevent service disruptions,” the railroads said in a statement.
“This comes after a long, tough process that began almost three years ago and led us through every step of the Railway Labor Act, including a Presidential Emergency Board,” said Josh Hartford with the Machinists Union’s Rail Division.
What are the terms of the new deal?
The tentative deal announced on Aug. 29, called for one additional day of paid leave. The tentative deal also offers raises larger than the 17% requested by the railroads, but not as generous as the 31% raises requested by the unions.
The board also suggests five $1,000 bonuses in their proposed deal.
Railworks can also expect an increase in their health insurance premiums each year, but their cost will be capped at 15% of the total cost of their healthcare plan.
The railroad said the recommendations from the three unions will be the biggest wage increase in decades.
The average salary will increase to $110,000 by the end of the deal in 2025.
Multiple unions said in a joint statement on Aug. 27 that the railroads still hadn’t done enough to address their quality-of-life concerns. The unions have shown an active dislike for strict attendance policies that railroads have imposed that make it hard to take any time off. Hopefully, an agreement can be made so the unions can meet their demands and ensure the supply does not suffer more than it already has.
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