Here is an Overview of the Current Railroad Labor Dispute and Possible Work Stoppage

Although eight of 12 unions have ratified agreements, if one of the four other unions decides to strike on December 9th, all 12 unions will honor picket lines and shut down rail freight in the U.S.

The Editor

Nov 23, 2022

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black train on railway at daytime — Photo by Adam Chang on Unsplash

A SUMMARY:

Interstate railroads (and airlines) in the United States fall under the jurisdiction of the Railway Labor Act (RLA) of 1926—a different law than the National Labor Relations Act of 1935, which governs most other private-sector workplaces.
Currently, there are 12 unions (with 13 different contracts) that have been negotiating with railroad management since 2020.
There are 30 railroads and 124,500 workers covered in the negotiations
In July, after the unions and railroads failed to reach agreements, as proscribed under the RLA, President Biden established a Presidential Emergency Board (PEB) to investigate and make recommendations to resolve the issues.
In September, tentative agreements were announced between the railroads and unions, subject to union ratification (or rejection) with all 12 unions.
According to the National Railway Labor Conference, the tentative agreements provide:
- 24 percent wage increases during the five-year period from 2020 through 2024, with a 14.1 wage percent increase effective immediately.
- Five $1,000 annual lump sum payments, adjustments to health care premiums, and health benefit enhancements, and an additional personal leave day for all employees.
- A portion of the wage increases and lump sum payments are retroactive, resulting in more than $11,000 on average in immediate payouts to employees.
- The contracts did not, however, provide the paid sick days the unions were demanding.
Between September and November, the unions held ratification votes with nine (9) contracts ratified and four (4) contracts rejected.
This week, one of the unions with the largest block of members (the International Association of Sheet Metal, Air, Rail, and Transportation Workers [SMART-TD]) announced the narrow rejection of its contract, further increasing the possibility of a work stoppage.
If agreements are not reached with the railroads—and without Congressional intervention—any one of the remaining four unions could call a strike at 12:01 am on December 9th.
If one union were to strike, all unions have pledged to honor each other’s picket lines, which would effectively shut down the rail freight in the U.S.
It is estimated that, if the unions were to strike, it would cost the U.S. economy $2 billion per day.
- The American Chemistry Council estimated that “if a strike drags on for a month, some 700,000 jobs would be lost as manufacturers who rely on railroads shut down, prices of nearly everything would increase even more, and the economy could be thrust into a recession.”
If the parties cannot resolve their contracts to avoid a work stoppage, Congress can intervene by passing legislation—which President Biden would need to sign—that could entail three options:
- “The three likeliest options are, one, they pass a bill imposing a longer cooling-off period, two, they pass a bill ending the strike — if there is a strike — and, three, they pass a bill that ends the strike and imposes terms on the parties, basically legislating a collective bargaining agreement for the parties,” Seth Harris, senior fellow at Northeastern University’s Burns Center for Social Change told FreightWaves.