Railway strike averted thanks to eleventh hour deal brokered by Biden administration

Nego­tia­tors rep­re­sent­ing Amer­i­can rail­road work­ers have reached an agree­ment with the nation’s biggest rail­ways on a new con­tract that will keep the nation’s rail­ways open and avoid a strike that could have raised prices and hurt the econ­o­my, Pres­i­dent Joe Biden announced in a state­ment ear­ly this morning.

“The ten­ta­tive agree­ment reached tonight is an impor­tant win for our econ­o­my and the Amer­i­can peo­ple,” said the Pres­i­dent, who lat­er deliv­ered remarks prais­ing the deal at the White House. “It is a win for tens of thou­sands of rail work­ers who worked tire­less­ly through the pan­dem­ic to ensure that America’s fam­i­lies and com­mu­ni­ties got deliv­er­ies of what have kept us going dur­ing these dif­fi­cult years. These rail work­ers will get bet­ter pay, improved work­ing con­di­tions, and peace of mind around their health care costs: all hard-earned.”

“The agree­ment is also a vic­to­ry for rail­way com­pa­nies who will be able to retain and recruit more work­ers for an indus­try that will con­tin­ue to be part of the back­bone of the Amer­i­can econ­o­my for decades to come.”

“I thank the unions and rail com­pa­nies for nego­ti­at­ing in good faith and reach­ing a ten­ta­tive agree­ment that will keep our crit­i­cal rail sys­tem work­ing and avoid dis­rup­tion of our economy.

“I am grate­ful for the hard work that Sec­re­taries Walsh, Buttigieg, and Vil­sack, and NEC Direc­tor Deese put into reach­ing this ten­ta­tive agreement.”

“I espe­cial­ly want to thank Sec­re­tary Walsh for his tire­less, around-the-clock efforts that deliv­ered a win for the hard work­ing peo­ple of the US rail indus­try: as a result, we will keep Amer­i­cans on the job in all the indus­tries in this coun­try that are touched by this vital industry.”

“For the Amer­i­can peo­ple, the hard work done to reach this ten­ta­tive agree­ment means that our econ­o­my can avert the sig­nif­i­cant dam­age any shut­down would have brought. With unem­ploy­ment still near record lows and signs of progress in low­er­ing costs, tonight’s agree­ment allows us to con­tin­ue to fight for long term eco­nom­ic growth that final­ly works for work­ing families.”

Jere­my Fer­gu­son, Pres­i­dent of the SMART Trans­porta­tion Divi­sion of the Inter­na­tion­al Asso­ci­a­tion of Sheet Met­al, Air, Rail and Trans­porta­tion Work­ers, joined Den­nis Pierce, the Pres­i­dent of the Broth­er­hood of Loco­mo­tive Engi­neers and Train­men, in a state­ment explain­ing what the work­ers had agreed to.

“Ear­ly this morn­ing fol­low­ing near­ly three years of bar­gain­ing, [our unions] reached a ten­ta­tive Nation­al Agree­ment with the nation’s largest freight rail car­ri­ers which includes wage increas­es, bonus­es, and no increas­es to insur­ance copays and deductibles,” they said in the open­ing com­ments of their release.

“For the first time our Unions were able to obtain nego­ti­at­ed con­tract lan­guage exempt­ing time off for cer­tain med­ical events from car­ri­er atten­dance poli­cies. Our Unions will now begin the process of sub­mit­ting the ten­ta­tive agree­ment to the rank and file for a rat­i­fi­ca­tion vote by the mem­ber­ships of both unions.”

“The ten­ta­tive agree­ment calls for an imme­di­ate wage increase of 14% once com­pound­ed with an addi­tion­al 4% on July 1, 2023, and 4.5% on July 1, 2024. In addi­tion, wage increas­es of 3% effec­tive July 1, 2020, 3.5% effec­tive July 1, 2021, and 7% effec­tive July 1, 2022, will be ful­ly retroac­tive, for a com­pound­ed increase of 24% over the 5‑year term of the agree­ment. The agree­ment also includes annu­al lump-sum bonus pay­ments total­ing $5,000.”

“The par­ties’ Health and Wel­fare Plan point-of-ser­vice costs will remain unchanged; there will be no increas­es to copays or deductibles and there are no dis­rup­tions to the exist­ing health care net­works. After over twen­ty hours of nego­ti­a­tions, we were able to reach an agree­ment that freezes our mem­bers’ month­ly health care con­tri­bu­tions at the end of the agreement.”

“No addi­tion­al increas­es will apply to our month­ly con­tri­bu­tions while the par­ties bar­gain over the next Nation­al Agreement.”

Time off for med­ical appoint­ments had been a big stick­ing point in the stalled nego­ti­a­tions, but that was over­come. The unions’ break­throughs came just in time to avert a strike, but prob­a­bly could have come much soon­er if a medi­a­tion board had­n’t sided with the rail­roads ear­li­er this summer.

Nev­er­the­less, the ten­ta­tive agree­ment is a big win for the Biden-Har­ris admin­is­tra­tion, which inter­vened in the nego­ti­a­tions and made deliv­er­ing a deal a top pri­or­i­ty. It shows what can be accom­plished when true friends of work­ers serve in the exec­u­tive branch, like Pres­i­dent Biden and Sec­re­tary Walsh.

Busi­ness orga­ni­za­tions are also thrilled. The pos­si­bil­i­ty of freight rail­road dis­rup­tions was a big headache that retail­ers and oth­er busi­ness­es were dread­ing. “We are relieved,” said a state­ment by the Retail Indus­try Lead­ers Association.

Amtrak, the nation’s pas­sen­ger rail­road, imme­di­ate­ly began scram­bling to reverse its plans to tem­porar­i­ly scrap all long dis­tance ser­vice, a move prompt­ed by the loom­ing pos­si­bil­i­ty of a strike. (Amtrak’s own work­ers were not threat­en­ing to strike, but Amtrak’s long dis­tance routes and many short­er dis­tance ones oper­ate on rail­roads owned and oper­at­ed by freight rail­road com­pa­nies such as Union Pacif­ic or Burling­ton North­ern San­ta Fe / BNSF.)

“Amtrak is work­ing to quick­ly restore can­celed trains and reach­ing out direct­ly to impact­ed cus­tomers to accom­mo­date on first avail­able depar­tures. Book­mark Amtrak.com/alerts for the lat­est updates,” Amtrak advised.

A strike would also have inter­rupt­ed Sounder com­muter rail ser­vice in the Cen­tral Puget Sound region of Wash­ing­ton State, as Sound Tran­sit explained yesterday.

“In the event of a nation­al rail strike, Sounder com­muter rail ser­vice between Everett and Lake­wood and Seat­tle would be can­celed begin­ning Fri­day, Sep­tem­ber 16th until work­ers return, the agency said.

“Sounder will oper­ate reg­u­lar ser­vice on Thurs­day, Sep­tem­ber 15th.”

“Sounder trains are oper­at­ed by union­ized BNSF Rail­ways employ­ees under con­tract on tracks owned by BNSF. Sounder trains are also dis­patched by BNSF employ­ees affect­ed by a poten­tial strike.”

Mem­bers of Con­gress were also hap­py to see the deal struck.

“This ten­ta­tive agree­ment is an impor­tant mile­stone to pre­vent a stop­page and keep our rail­ways and our econ­o­my run­ning,” said Sen­a­tor Pat­ty Murray.

“I’m grate­ful for the hard work Pres­i­dent Biden, Sec­re­tary Walsh, Sec­re­tary Buttigieg, Chair­man Pucha­la, the rail unions, and car­ri­ers put in to stay at the table, nego­ti­ate in good faith, and help reach this agreement.”

“The agree­ment would not only deliv­er rail work­ers bet­ter pay, ben­e­fits, and work­ing con­di­tions, but also sup­port rail com­pa­nies by strength­en­ing our freight rail work­force. This is a win for rail work­ers and our entire economy.”

“It’s crit­i­cal that we have a work­ing freight sys­tem to move 95 mil­lion tons of goods in Wash­ing­ton annu­al­ly, includ­ing grain and oth­er prod­ucts grown and man­u­fac­tured in the state. I am glad that Pres­i­dent Biden helped bro­ker a deal between busi­ness and labor that will con­tin­ue to invest in keep­ing and skilling a work­force for tomor­row with the right ben­e­fits,” said Sen­a­tor Maria Cantwell.

We at NPI are very hap­py that the rail­way work­ers were able to secure new lan­guage to enable them to take unpaid time off for med­ical appoint­ments with­out a penal­ty, in addi­tion to pay increas­es and pro­tec­tion from ris­ing health­care costs. They stood in sol­i­dar­i­ty for a bet­ter deal and pre­vailed — to not only their own ben­e­fit, but the ben­e­fit of the labor move­ment and the country.