Labor Deal Goes Off the Rails

Labor Deal Goes Off the Rails
BNSF train (Shutterstock)

Looks like President Joe Biden might have taken a premature victory lap.

On Sept. 15, Biden celebrated a temporary agreement between the railroad industry and the rail workers unions, an agreement forged to avoid a rail strike. The temporary agreement was hammered out after a 20-hour negotiating session headed by Labor Secretary Marty Walsh.

“The tentative agreement reached tonight is an important win for our economy and the American people,” Biden said. “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.”

The agreement called for a 24% raise in pay over five years, no increased health care costs and more paid time off. In addition, workers would be able to take time off for medical appointments without being penalized. 

A rail strike would obviously strain the social and economic fabric of the country, already burdened by high inflation. A strike would cost the economy about $2 billion daily, so the Biden administration was understandably pleased to have averted one.

But on Oct. 10, the Brotherhood of Maintenance of Way Employes Division of the International Brotherhood of Teamsters (BMWED) voted the temporary agreement down. Four other unions had previously approved the contract.

Negotiations were between the National Carriers’ Conference Committee, which represents the freight railroad companies, and 12 unions representing 115,000 railway workers. The BMWED, the nation’s third-largest railway union, voted 6,646 to 5,100 against ratification of the agreement. Seven other unions have yet to vote, although at least two will have by the time you read this.

All 12 unions must approve the deal to avoid a strike that would stop in its tracks a $2 billion-per-day industry responsible for 40% of the nation’s freight traffic.

In comments after the vote to reject, it was clear that railway workers are not fighting so much for more pay — the deal also included $5,000 bonuses — but for benefits like more days off.

“The majority of the BMWED membership rejected the tentative national agreement and we recognize and understand that result,” union President Tony D. Cardwell said. “I trust that railroad management understands that sentiment as well. 

“Railroaders are discouraged and upset with working conditions and compensation and hold their employer in low regard. Railroaders do not feel valued. They resent the fact that management holds no regard for their quality of life, illustrated by their stubborn reluctance to provide a higher quantity of paid time off, especially for sickness. 

“The result of this vote indicates that there is a lot of work to do to establish goodwill and improve the morale that has been broken by the railroads’ executives and Wall Street hedge fund managers.”

The National Carriers’ Conference Committee said it was disappointed that the BMWED voted against the agreement. 

Things aren’t irrevocably broken. No strike will be called until after elections in November, so the two sides still have a month to hammer out a deal that all 12 unions will approve.

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