Workin’ On The Railroad…Or, Maybe Not

September 13th, 2022 by Tom Lynch

Only 10.6% of US workers are in unions, but the 140,000 railroad freight workers are among them. The workers have been without a contract for the last three years, and are deep in negotiations for a new one with the National Carriers’ Conference Committee (NCCC), the group representing Class I railroads in the  negotiations. Like everyone else, both sides have been hit hard by the pandemic and the inflation that followed.

The workers are in twelve companies from the very large to the not so very large. Thus far, the good news is eight of the twelve have come to tentative agreement with the employers, three of them this past Sunday. The bad news is this only represents about 86,000 of the 140,000. The even worse news is if agreements for the others are not reached by 12:01 Saturday morning, 17 September, they’ll be going on strike—all of them.

According to the US Chamber of Commerce and the NCCC, “Widespread railroad disruptions could choke supplies of food and fuel, spawn transportation chaos, stoke inflation, and cause $2 billion per day in lost economic output.”

The Biden Administration appointed a presidential emergency board (PEB) in mid-July to break the impasse, and the board released its findings to interested parties in mid-August. Like Solomon, the PEB pretty much split the difference between the unions’ wage ask and the railroads’ offer. Subsequently, the President urged the parties to reach agreement speedily, because not doing so will invite congressional intervention. Now, that would be quite the opportunity for political posturing. Ladies and gentlemen, start your engines.

The tentative agreements announced Sunday include the Brotherhood of Maintenance of Way Employees Division of the International Brotherhood of Teamsters; the International Brotherhood of Boilermakers; and the International Association of Sheet Metal, Air, Rail and Transportation Workers-Mechanical Department.

“The tentative agreements … include a 24% wage increase during the five-year period from 2020 to 2024—with a 14.1% wage increase effective immediately—and five annual $1,000 lump sum payments. Portions of the wage increases and lump sum payments are retroactive—totaling more than $11,000 in immediate payments per employee—and will be paid out promptly upon ratification of the agreements by the unions’ membership,” said the NCCC.

The tentative agreement also adds an additional paid day off that can be used as a personal day, vacation day or on the employee’s birthday.

Factoring in healthcare, retirement and other benefits, employees’ total compensation would average more than $150,000 per year.

Several major Class I railroads said Friday they would begin curtailing shipments of hazardous materials and other chemicals in the event loads might be left unattended on a rail network. The unions label this “corporate extortion.”

What would a rail strike mean? Well, for starters a strike could shut down 30% of the country’s freight services and block most passenger and commuter rail services, according to the Association of American Railroads. Some 7,000 freight trains run by major rail companies including CSX, Union Pacific, BNSF, Norfolk Southern, and Kansas City Southern could be shut down, while passengers could face disruptions as well because commuter rail systems depend on tracks owned by freight railroads.

In my home state of Massachusetts, where there is a popular, heavily used commuter rail system, this could be devastating, because Boston’s MBTA subway system is in dire straights, with its Orange Line, the second highest in ridership, shut down for repairs.

This all comes in the midst of seeming union rejuvenation, as seen by efforts at Starbucks, Amazon and others. Still, as mentioned above, unions represent only 10.6% of the workforce, and the majority of those are in the public sector.

It’s prediction time, and mine is as good as anyone else’s not on the inside of negotiations. I’m betting the warring factions will reach agreement just as the clock comes close to the witching hour, disappointing politicians yearning for the next soapbox. But, as my dear father used to say, it’ll be, “One-hundred yards to the outhouse, by Willie Make-it.”

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