A group of freight unions representing 90,000 workers could strike next week, potentially exasperating supply chain issues in an already weakened market.
Strike concerns came to a head in July when President Joe Biden implemented a “cooling off period,” which mandated a 60-day delay in striking for negotiations to occur, CNN reported. The mandate runs out Sept 16, and a strike on that day would lead to the immediate stoppage of 40% of all freight lines in the nation unless Congress extends the moratorium.
“The fact is [the railroads] are counting on Congress to act,” said Dennis Pierce, president of the Brotherhood of Locomotive Engineers and Trainmen, according to CNN. “We’ve let [Congress] know we need them to stay out of it.”
Part of the president’s “cooling off period” also implemented a panel known as a Presidential Emergency Board (PEB), which recommended a compromise contract, according to CNN. The PEB recommended a 14% raise, including back pay for hours worked since 2020, annual bonuses of $1,000 and raises that combine to a 24% pay increase over the next five years.
If this happens, workers will continue to flee the industry, and you cannot legislate workers back to work if they have resigned.https://t.co/Vv0FmZrJil
— Railroad Workers United ✊ (@railroadworkers) September 9, 2022
“As the freight sector heads into peak shipping season, a nationwide rail work stoppage would result in an unnecessary $2 billion daily economic hit,” said Association of American Railroads (AAR) President and CEO Ian Jefferies in a Thursday statement regarding the strike. “President Biden’s PEB recommended terms that would maintain the highest quality health care coverage and result in compounded wage increases of 24%, bonuses totaling $5,000 — the highest pay increases in nearly 50 years.”
The $2 billion estimate comes from an AAR report which also argued that in the event of a rail stoppage, other transportation methods would be unable to compensate. The potential for a $2 billion a day economic hit comes after the Federal Reserve warned Wednesday of a “generally weak” economy, anticipating high inflation continuing until at least the end of the year, and noting that nearly half of all regions in the U.S. were experiencing an economic contraction.
More than 9 in 10 workers in Railroad Workers United would vote down the PEB proposals and choose to strike, according to The Hill. In the 30 days following the PEB’s recommendation, only 5 of 12 rail unions, representing a minority of workers, signed on, according to CNN.
The National Railway Labor Conference (NRLC), which represents railway management, urged labor in an Aug. 17 statement to accept the PEB’s terms. The statement stressed that even though the projected raises and costs to railway management was much higher than its initial offer “it is in the best interests of all stakeholders – including customers, employees, and the public” if railroads and labor came to an agreement.
While unions are concerned about pay increases, other primary issues include concerns over “on call” requirements, which unions say would lead to decreased quality of life and keep workers away from their family, according to CNN. Railroad Workers United retweeted a comment by advocacy organization Fight For Two Person Crews, which stated that the strike was not “about money,” but rather about “attendance issues and the destruction of the U.S. rail industry.”
The National Railway Labor Conference did not immediately respond to the Daily Caller News Foundation’s request for comment.
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