Talks continue to avert crippling freight train strike

New York
CNN business

Talks continued through Wednesday in a bid to avert a freight rail strike set for early Friday that could disrupt the nation’s supply chain and raise prices for everything from gasoline to food to cars.

Two rail unions, representing more than 50,000 engineers and conductors who make up the two-man crews that run trains, are threatening their first rail strike in 30 years from 12.01am on Friday. Union leaders and railroad labor negotiators met throughout the day with Labor Secretary Marty Walsh in his office in Washington, DC. Talks were still ongoing as of 6:30 p.m., which was perhaps taken as a hopeful sign that progress was being made.

In fact, a person familiar with the discussions said that the negotiators had just ordered an Italian dinner, and it appears that there is no intention of suspending the talks in the short term.

A Labor Department spokesman said Wednesday that unions and railroad officials are “negotiating in good faith” and are “committed to remaining at the table” as discussions continue.

On Wednesday morning, White House press secretary Karine Jean-Pierre told reporters on Air Force One that “all sides need to be at the table, to resolve the outstanding issues in good faith and reach an agreement. Shutting down our freight rail system is an unacceptable outcome for our for the economy and for Americans, and all parties must work to prevent this.”

The Labor Department asked management and employees not to comment on the status of the talks, and they did not respond to requests for comment.

Almost 30% of the nation’s freight moves on the nation’s railroads. Many vital sectors—including oil refining, agriculture, automotive and other manufacturing, as well as imports of consumer goods—depend on railroads to function. While a short strike would have limited impact, economists say a strike lasting a week or more could have serious economic consequences.

The railways announced last Friday that it had stopped accepting shipments of hazardous materials, including fertilisers, as well as safety-related materials, out of concern that trains will be stopped everywhere once the strike begins. Many stopped accepting shipments of agricultural products on Wednesday.

Union Pacific (UNP) train crew members were notified by the railroad late Tuesday that if they are in the middle of a trip when the strike begins at 12:01 a.m. EST Friday, they should park and secure the train and wait for transportation.

Freight railroad Norfolk Southern (NSC) plans to use management staff to operate a limited number of trains in the event of Friday’s strike. This can allow critical materials such as chlorine to reach their destination at water treatment plants.

“We will have some powers. It’s not a great capability, but we’ll have something for it,” Norfolk Southern spokesman Connor Spielmaker told CNN Business Wednesday. “He’s still planning how to use them.”

Spielmaker said the railroads still hope to reach an agreement with the unions and avoid that situation. Freight carriers CSX, BNSF and Union Pacific declined to say whether they would use management staff to operate trains in the event of a strike.

The effort to avert a strike is an important test for President Joe Biden and his White House, which has positioned itself as one of the most pro-labor administrations ever. At the same time, he also wants to avoid possible shocks to the economy, especially with the mid-term elections seven weeks away.

Railroad workers are governed by a different labor law than most workers, which limits their freedom to strike and allows for more government intervention. In July, Biden issued an order preventing a strike at that time and created a committee, known as the Presidential Emergency Committee, to try to find a solution to the dispute. It also established a 60-day rest period, unions could not strike and management could not lock out workers.

But Biden can’t order the railroads to keep operating when the cooling-off period expires Friday. Congress can only act if there is no agreement to keep workers on the job. Senator Richard Durbin, the second-ranking member of the Senate Democratic leadership, told CNN this week that congressional action is unlikely, despite business groups calling on Congress to act. The Senate is in recess on Friday, and many members of Congress are heading to London to attend Queen Elizabeth’s funeral.

The PEB’s recommendations called for workers to seek an immediate 14% pay rise, plus back pay from 2020 onwards. He also asked for a 24% salary increase over the five-year term of the contract from 2020 to 2024, and cash bonuses. $1,000 per year.

But it did not address the labor shortages and scheduling regulations that have become key to the dispute. Engineers’ and conductors’ unions say the railroads are demanding that their members be “on call” and ready to go to work seven days a week. The management of the two unions says that their members would not accept a contract without changing these work rules.

There are over 50,000 other unions on the railroads that maintain tracks, operate signals, dispatch trains, and perform mechanical work, among other things. But they are not subject to the same labor rules, and those unions had already agreed to tentative agreements with the railroads based on the PEB’s recommendations.

One of those unions, the Machinists, announced Wednesday that its members had voted to reject its interim labor agreement. The railroads have about 5,000 union members as locomotive drivers, track equipment mechanics and facility maintenance workers.

The rejection of the proposed contract is not an immediate setback in efforts to avoid a strike. The union has said it will not go on strike before the end of the month, as it tries to get a change in the temporary agreement accepted by its members. But it’s a sign of the complexity of reaching agreements with the dozen or so different unions the railroads are facing. eligible for rank-and-file membership.

Two other unions, the Karmen Railway Brotherhood and the Transport Communications Union, which have between them 11,000 members, ratified the agreements on Wednesday.

CNN’s Matt McFarland, Ali Zaslav, Kate Sullivan, Phil Mattingly and Maegan Vazquez contributed to this report