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Big business calls on Biden to avert rail strike

U.S. Chamber urges Presidential Emergency Board to resolve stalemate

The U.S. Chamber of Commerce is calling on President Joe Biden to help resolve a dispute between the country’s Class 1 railroads and 12 rail unions to avert a possible rail strike beginning July 18.

In a letter sent to the White House on Wednesday, U.S. Chamber President Suzanne Clark warned that the decision last month by the National Mediation Board (NMB) to release the railroads and unions from mediation and begin a 30-day cooling off period “presents a new challenge to the U.S. business community, which is already navigating a difficult environment.”

Unless the administration acts, either party is free to exercise “self-help” options — including a strike beginning at 12:01 a.m. on July 18, when the 30-day cooling-off period ends.

“I urge you to help resolve the ongoing labor negotiations … by following historic precedent and appointing a Presidential Emergency Board (PEB) comprised of individuals who are impartial, belong to the National Academy of Arbitrators, and have direct experience in resolving rail disputes,” Clark wrote. “It is imperative that the Administration act to prevent any disruption to America’s rail service.”

The letter was copied to Secretary of Labor Marty Walsh and Secretary of Transportation Pete Buttigieg.

The railroads and their unions have been embroiled in disagreements over a contract since January 2020, with wages and health care benefits being major sticking points. The NMB, an independent federal agency that mediates labor agreements for the railway and airline industries, stepped in earlier this year to mediate.

But with the NMB unable to make sufficient headway in the negotiations, major businesses represented by the U.S. Chamber are getting nervous, particularly given ongoing supply chain disruptions still being felt as a result of the pandemic.

“And we are now facing uncertainty over the possibility of further disruptions during preparations for the holiday shopping season,” Clark stated. “Any breakdown would be disastrous for U.S. consumers and the economy, and potentially return us to the historic supply chain challenges during the depths of the pandemic.”

The National Carriers’ Conference Committee (NCCC), which represents the railroads in collective bargaining, said it expects a PEB to be appointed before the end of the cooling-off period as has been the case in prior contract stalemates. A PEB would then have 30 days to conduct hearings and issue a report during which time work stoppages are prohibited and for another 30 days following the issuance of the report, NCCC pointed out.

“In the past, PEB recommendations have served as the basis for voluntary agreements, but in some cases Congress has had to intervene.”

Speaking on behalf of labor, Greg Regan, president of the AFL-CIO’s Transportation Trades Department, said the unions want experienced arbitrators who also understand railroad economics appointed to the PEB.

“The reality is railroad executives continue to make record profits off the backs of rail workers after shrinking the total workforce by 30 percent since 2015,” Regan said. “We trust the Biden administration will appoint qualified arbitrators who meet these standards.”

Click for more FreightWaves articles by John Gallagher.

The FREIGHTWAVES TOP 500 For-Hire Carriers list includes National Carriers (No. 116).

5 Comments

  1. It’s not all about wages, yes no contract for 3 years and insults to the workforce compounded by psychotically impossible attendance policies requiring 24/7/365 on call work schedules with zero personal time and horrific and toxically and mentally abusive work conditions is the kicker that has brought this situation to a head. Rail carriers assume rail workers should have no time off as part of their business model. They try to get people (with NO regular days off and all time off punished) to sell back even the few days a year they actually can take off to keep employees from taking any time off at all. Stagnant wages on top of holding pension ransom, and threatening cutting health benefits even more? Anything that made railroad work worth the time and effort has been wholly vaporized. This article wants to blame the pandemic, and the NMB for releasing mediation, yada yada. The reason this strike is pending is simply inadequate and reckless leadership that is all but non existent, dismissive of workers at best.

  2. My son left CSX after 18 years due to the work environment and work overload saying, “This is no way to live.” He loved his job when he began employment. What a shame the greed for profit has caused such misery for employees. I would love to see him return to his job under much better conditions. Everyone I know that works for CSX are totally unhappy.

  3. As a 24 year employee of a class 1 RR I can say without any doubt that the RRs have purposely caused a manpower shortage.they want to shrink there workforce and in turn run off there small customers in order to focus on there bulk commodity and intermodal business which has a higher ROI.they are a monopoly that wants to pick and choose which customers they service.WALL STREET GETS WHAT WALL STREET WANTS.

  4. Mr. Clark incorrectly blames the fault of the current supply chain crisis on the pandemic. To be fair, a significant player in the supply chain crisis are the Class 1 railroads and the practice of PSR. They have found that it is easier to overcharge customers and manufacture surcharges than it is to run an efficient freight logistics operation. Three years ago “on-time” delivery of freight for the Class 1’s was 85%. In the last year that has dropped to 67%. In that same time frame profits have tripled and inflation is rampant. The charged “extras” the carriers lay on their customers is always passed on…and on…and on…until the end consumer, the least represented and least powerful in the chain, gets stuck with the bill.

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John Gallagher

Based in Washington, D.C., John specializes in regulation and legislation affecting all sectors of freight transportation. He has covered rail, trucking and maritime issues since 1993 for a variety of publications based in the U.S. and the U.K. John began business reporting in 1993 at Broadcasting & Cable Magazine. He graduated from Florida State University majoring in English and business.