Early Thursday morning, freight rail companies and unions reached a tentative agreement to avoid a strike that could start on Friday. The agreement is now open to union members for a ratification vote. Workers agreed not to strike while votes were being tallied.
The deal broke a deadlock between the railroad industry and tens of thousands of workers across the country, a crucial move that could have made the transportation of vast numbers of products, from oil to grain, virtually impossible. Network closure avoided. American train.
In recent days, the White House has tried to avoid a work stoppage, which comes at an inconvenient time for the Biden administration and would have exacerbated already high inflation and disrupted American travel and business.
With the midterm elections looming in November, President Biden and other senior government officials have focused their pitches to voters largely on the economy, particularly on inflation-cutting legislation. Massive labor strikes, especially persistent strikes, would complicate his narrative of the health of the economy under his leadership. rice field.
What was the dispute between the railroads and the unions?
The two main pain points were excessive scheduling and sick time. Railroad companies have been reluctant to agree to labor groups’ demands that workers be able to seek medical attention or deal with personal problems without risking disciplinary action. Union representatives also said workers often schedule long shifts on short notice.
What is included in the interim deal negotiated by railroads and unions?
The American Railroad Association, an industry group, said in a statement The new deal includes a 24% increase in wages over five years from 2020 to 2024. And if the deal is ratified, there will be an average payout of $11,000, the association said.
The agreement also gives workers an extra day of paid leave and the ability to attend medical facilities without penalty, the union said. The Brotherhood of Locomotive Engineers and Trainmen and the transportation division of the International Association of Sheet Metal, Air, Rail and Transportation Workers also agreed that the deal would freeze workers’ monthly medical payments and reduce those costs during the next contract period. said to be guaranteed not to increase. negotiation.
What is at stake: travel, supply chains and inflation?
No Amtrak employees were involved in the labor negotiations, but the company announced Wednesday the cancellation of long-distance passenger trains because it uses freight trucks that could be disrupted by the work stoppage. On Thursday, it said it was “working to quickly restore canceled trains.”
Rail freight is at the heart of global supply chains and the pandemic has already disrupted it, with freighters, trains and trucks continuing to face challenges in transporting goods. A strike would slow the distribution of goods within the United States and with our trading allies abroad.
This rail system will also help carry crude oil from Canada to the United States and export US gasoline and diesel to Mexico. Any disruption to these developments could push gasoline prices back up after steadily declining since June. Fuel prices are a major factor in overall inflation.