116 3rd St SE
Cedar Rapids, Iowa 52401
Everything you need to know about the averted rail strike
Sep. 15, 2022 3:48 pm
Freight railroad companies and unions representing workers have been locked in a dispute over pay and working conditions, but President Joe Biden said Thursday that they had reached a "tentative" deal to avoid a major economic disruption. A strike would have affected not only commuters who rely on the railway to get to work but also the nation's energy supply and drinking water.
Two of the largest unions -- representing 57,000 conductors and engineers -- held out until the final hours. But Wednesday and through the night into Thursday, Labor Secretary Marty Walsh held emergency meetings with the rail carriers and unions to help broker a deal. Disruptions were already being felt: Amtrak announced it would cancel all of its long-distance trains starting Thursday, and other rail systems braced for shutdowns.
It's unclear when operations might resume; Amtrak said it is "working to quickly restore canceled trains."
The impasse was tied to disagreements between management and labor over sick time and penalties for missing work, a politically challenging stalemate for Biden, who has vowed to be the nation's "most pro-union president" but has prioritized untangling its besieged infrastructure in the COVID era.
Here's what you need to know about the dispute.
What's included in the tentative deal?
The tentative agreement announced Thursday includes "better pay, improved working conditions," Biden said in a statement, as well as peace of mind for workers around their health care costs.
It includes one paid sick day for workers, according to people briefed on the plan who spoke on the condition of anonymity because it had not yet been publicly announced. Workers had pushed for more flexibility in this area -- saying a points-based attendance policy that had been adopted by some carriers could penalize workers for missing work for family emergencies or doctor's appointments.
The deal also includes the biggest pay increases that workers have seen in decades: Wages will climb 24 percent by 2024, which includes an immediate 14 percent raise. They'll also get $1,000 annual bonuses over five years, and will not have to absorb higher health-care deductibles or co-pays.
Though the agreement still needs to be ratified, which can take weeks, it raises the likelihood a strike can be avoided -- a relief for freight operators and consumers alike.
Will passenger trains and other routes still be affected?
Amtrak had canceled service on all its long-distance routes starting Thursday. After the deal was announced, the company said it was working to restore the trains and rebook customers.
Most of those trains have a daily trip in each direction and provide cross-country connections for thousands of Americans. A suspension in service would have affected 24 to 28 daily trains.
A strike could have been especially disruptive for commuter lines that run between major cities and suburbs, because those routes often operate on freight tracks, which would not be available to passenger trains. Workers who rely on the Washington region's commuter lines in Virginia and Maryland would have experienced outages. Both the Virginia Railway Express in Northern Virginia and two of Maryland's Marc commuter lines that serve the District would have been suspended in the event of a strike.
A stoppage also would have had significant implications for retailers, which rely on freight rails to transport inventory from ports to warehouses and distribution centers. Such a scenario would have had a domino effect -- retailers would miss their shipping and pickup dates, leaving cargo in limbo without a place to go, according to Jonathan Gold, the vice president of supply chains and customs policy at the National Retail Federation.
"It adds to the ongoing congestion that we're facing within the supply chain," he said. "And that all adds additional costs that folks haven't planned for."
Some railroads had implemented shutdown procedures in anticipation for Friday, and it will take time to reverse those procedures.
Why was the rail strike averted?
The threat of the strike -- and the potential repercussions -- pushed politicians on both sides of the aisle, as well as White House officials, to get more directly involved in negotiations. Biden was personally involved in the talks convened by Labor Secretary Marty Walsh in Washington.
Eventually, the two sides agreed to a tentative deal before a strike would have started.
A federally mandated "cooling-off" period was scheduled to end at 12:01 a.m. Friday, creating conditions for a strike, if employees refused to go to work, or a lockout, if the carriers refused to let workers do their jobs. But the tentative deal appears to have averted a work stoppage for now.
The Biden administration had begun preparing for a potential crisis, and disruptions began unfolding on Wednesday. It was the first time the railways faced a strike in three decades.
Why were railroad workers prepared to strike?
A crucial issue in the dispute is a points-based attendance policy adopted by some of the largest carriers earlier this year. Those policies penalize workers, up to termination, for going to routine doctor's visits or attending to family emergencies. Conductors and engineers say that they can be on call for 14 consecutive days without a break and that they do not receive a single sick day, paid or unpaid.
"All we're asking is folks to be able to go to routine doctor's visits without pay, but they have refused to accept our proposals," Dennis Pierce, president of the Brotherhood of Locomotive Engineers and Trainmen (BLET) said before the deal was struck. "The average American would not know that we get fired for going to the doctor. This one thing has our members most enraged. We have guys who were punished for taking time off for a heart attack and COVID. It's inhumane."
When was the last rail strike in the U.S.?
The last industry strike took place in 1992, when railroad workers with the International Association of Machinists walked off the job. In response, most of the country's freight railroads shut down, forcing Congress to pass legislation imposing a new contract on workers. President George H.W. Bush at the time said that the strike "ought to end the day it begins."
The ramifications of the shutdown were so severe that Congress intervened after just three days to ban strikes and lockouts.
Railroad strikes have long played a significant role in American history. A century ago, a railroad strike could effectively shut down the entire nation. Railroad strikes set the standard for such ubiquitous working conditions as the eight-hour workday, said Nelson Lichtenstein, a labor historian at the University of California at Santa Barbara.
"In the late 19th century, all the great strikes were railroad strikes, and they had a revolutionary flavor to them," Lichtenstein said. "Railroad strikers burned down Pittsburgh, shut down Chicago. The eight-hour workday was won by the railroad workers' strike."
Union members in the United States generally have the right to go on strike to pressure companies to offer strong contracts. But the Railway Labor Act of 1926 imposed barriers to striking, including intervention mechanisms from Congress, because of the potential economic impacts of these work stoppages.
Railroad strikes generally revolve around work rules, rather than wages, Lichtenstein said, because railroad management often tries to control costs by forcing workers to work on demand.
"Historically, Congress will intervene and the president will put forward legislation that adopts what the latest mediation panel says. Last-minute deals happen often," he said. "The threat of a real strike will get management making concessions."
What would happen in a shutdown?
In addition to rattling commutes and spoiling cross-country travel for thousands of Americans, a disruption could deal a major blow to the economy. A strike would shut down nearly a third of the country's freight, industry players have warned.
A freight railroad shutdown could "devastate" Amtrak operations, according to the Association of American Railroads. About half of commuter rail systems run at least partially on tracks or rights of way owned by freight railroads.
While scrambling to strike a deal, the Biden administration was pursuing contingency plans to ensure key products carried by rail -- including food, energy and health products -- would reach their final destinations.
What was Washington's role?
While Democratic lawmakers largely relied on Biden to reach an agreement, Republicans urged Congress to intervene, introducing legislation aimed at forcing workers and railroad companies to accept contract recommendations proposed last month by a nonpartisan panel appointed by the president.
The unions rejected those recommendations because they do not roll back penalties for missing work because of illness or family emergencies.