Breaking News: Rail Strike Averted as Unions Agree to Deal

Source: Transport Topics

Published September 15, 2022

A deal has been reached between union workers and six Class I railroads, averting a threatened strike that could have snarled the nation’s freight and passenger rail service.

The U.S. Department of Labor — which had stepped in to help avoid a potential Sept. 16 strike by workers — early on Sept. 15 announced that a tentative agreement had been negotiated between the 13 railroad workers’ unions and the management council for the rail carriers. The announcement prevents what could have been a devastating nationwide walkout by 150,000 locomotive engineers, conductors and other employees.

President Joe Biden in a statement said the agreement would guarantee “better pay, improved working conditions, and peace of mind around their health care costs” for the workers, but specific details of the pact are not yet known. However, a Presidential Advisory Board he earlier convened had recommended a settlement that proposed immediate 24% pay raises for workers retroactive to 2020 and immediate $5,000 bonuses. Workers also have sought significant changes in work rules to give them more flexibility in their schedules.

As the deadline loomed, companies had already begun preparing for disruptions. Amtrak and other regional passenger railroads that share tracks with the freight railroads were planning to suspend long-distance rail service, and some freight operations were also being halted. It was unclear how quickly those operations might resume based on the tentative deal.

The trucking industry and other organizations had urged the two sides to settle. American Trucking Associations President Chris Spear was one of several supply chain leaders to warn of the damaging economic impact a strike could levy, and stressed that the trucking industry did not have the excess capacity to move the additional freight that would shifted off the rails had there been a strike.

The American Association of Railroads estimated a strike could have caused $2 billion a day in economic impact, causing disruption of agriculture, energy, retail, automotive and several other types of freight. The railroads move an estimated 30% of the nation’s freight each day.