An influential railroad workers union on Monday rejected a labor deal brokered by President Biden, raising the threat of a crippling strike before Christmas.
The rejection by the SMART Transportation Division (SMART-TD), a 36,000-member union representing rail conductors, increases the likelihood that Congress will step in to settle the dispute before a strike begins as early as Dec. 5.
Another large freight union, the Brotherhood of Locomotive Engineers and Trainmen, voted Monday to ratify the agreement but said it would honor a picket line if any other unions walk out.
Three other unions have rejected proposed deals.
Seven smaller unions have approved the five-year deal that, on top of a 24% raise, includes $5,000 in bonuses. Many union members said they voted to reject the contracts because they fail to address demanding schedules and quality of life issues for employees.
All 12 unions must approve the contracts to prevent a strike, which could cripple supply chains and increase inflationary pressures on a stressed U.S. economy emerging from the pandemic.
More negotiations with rail management are expected.
The Retail Industry Leaders Association said a rail strike “would cause enormous disruption to the flow of goods nationwide,” although retail stores are well-stocked for the crucial Christmas shopping season.
“Fortunately, this year’s holiday gifts have already landed on store shelves. But an interruption to rail transportation does pose a significant challenge to getting items like perishable food products and e-commerce shipments delivered on time, and it will undoubtedly add to the inflationary pressures already hitting the U.S. economy,” said Jess Dankert, the vice president for supply chain with the association, which represents more than 200 major retailers.
Even the threat of a work stoppage could tangle the nation’s supply chain because railroads freeze shipments of chemicals and other goods that could create hazards if disrupted midway to their destinations.
The Association of American Railroads warned Monday that time is running out for Congress to act under the Railway Labor Act of 1926, which authorizes lawmakers to impose contract terms if both sides can’t reach an agreement.
“Railroads stand ready to reach new deals based upon the [recommended] framework with our remaining unions, but the window continues to narrow as deadlines rapidly approach. Let’s be clear: If the remaining unions do not accept an agreement, Congress should be prepared to act and avoid a disastrous $2 billion a day hit to our economy,” said AAR President and CEO Ian Jefferies.
The U.S. Chamber of Commerce is urging Congress to get involved and avert a strike.
“A rail strike would be catastrophic for our economy, costing $2 billion per day and imposing enormous challenges to businesses, local communities, and commuters,” Chamber Executive Vice President Neil L. Bradley wrote to lawmakers. “Congress has acted 18 times on prior occasions to prevent a rail strike and we urge the House and Senate to be prepared to act again should a minority of the 12 unions continue to hold out approval on a new contract.”
Republicans, who will take over the House majority in January, have been calling for legislation to impose the terms of the agreement and prevent a strike.
Most Democrats, who control the House in the lame-duck session of Congress, have been unwilling to block a strike and risk angering their labor supporters.
Sen. Roger F. Wicker, Mississippi Republican, and Sen. Richard Burr, North Carolina Republican, tried to force a vote in the Senate on legislation to impose the terms of the deal before a strike deadline in September.
The White House said a rail strike is “unacceptable” because of the harm it would inflict on families and businesses. White House press secretary Karine Jean-Pierre said the president is being briefed on developments and the administration is preparing for the possibility of a strike.
“The best option is still for parties to resolve this themselves,” she told reporters. “Our team is preparing and planning for all possible outcomes.”
Sick leave has been a major sticking point in negotiations. Under the terms of the agreement, railroad workers could take unpaid days off for doctor appointments without penalty under railroad attendance rules.
A presidential emergency board appointed by Mr. Biden this summer recommended the terms. The pay raises would be retroactive to July 2020, meaning the average rail worker would receive back pay of about $11,000.
The raises would be the biggest that railroad workers have received in more than four decades. The railroad industry has said that average rail worker salaries would reach $110,000 a year by the end of the five-year deal in 2025.
The SMART-TD votes were split. The union said 50.87% of train and engine service members voted to reject the deal and 62.48% of yardmasters voted to ratify.
“SMART-TD members with their votes have spoken. It’s now back to the bargaining table for our operating craft members,” SMART-TD President Jeremy Ferguson said. “This can all be settled through negotiations and without a strike. A settlement would be in the best interests of the workers, the railroads, shippers and the American people.”
A status quo agreement between SMART-TD and management is in effect until Dec. 8. The union said SMART-TD would be allowed to go on strike or the rail carriers would be permitted to lock out workers on Dec. 9 “unless Congress intervenes.”
“The ball is now in the railroads’ court. Let’s see what they do. They can settle this at the bargaining table,” Mr. Ferguson said. “But the railroad executives who constantly complain about government interference and regularly bad-mouth regulators and Congress now want Congress to do the bargaining for them.”
The unions say paid sick time is long overdue and the pandemic has highlighted the need for it.
The group that negotiates on behalf of the railroads said Monday that the unions that rejected their deals shouldn’t expect to receive more than the presidential emergency board of arbitrators recommended.
The National Carriers’ Conference Committee said the threat of a strike could affect businesses before the deadline because railroads would start curtailing shipments of dangerous chemicals and perishable cargo days ahead of time.
“A national rail strike would severely impact the economy and the public. Now, the continued, near-term threat of one will require that freight railroads and passenger carriers soon begin to take responsible steps to safely secure the network in advance of any deadline,” the railroads said.
The unions that voted Monday represent more than half of the roughly 115,000 rail workers involved in the contract dispute with Union Pacific, Norfolk Southern, BNSF, Kansas City Southern, CSX and other railroads.
• Dave Boyer can be reached at firstname.lastname@example.org.
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