Threat of Railway Strike Looms Over Holiday Season
A new kind of supply chain back-up is threatening the holiday season, which has already been complicated by COVID-19 delays, rampant inflation and the threat of recession.
A group of train and engine service workers rejected a collective bargaining deal with the railroads on Monday and is heading back to the negotiating table, setting up a possible national strike as soon as Dec. 9.
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Four out of 12 unions have now nixed a deal that was brokered by the administration of President Joe Biden, and the two sides now have until Dec. 8 to hammer out their differences.
If no meeting of the minds is made, all 12 unions could strike on Dec. 9.
While there is hope that a resolution can still be found before the deadline, the National Retail Federation put a call out for Congress to step in to stop a strike.
“Millions of hardworking Americans rely on the freight rail system for their jobs and the economic security of our country,” said Matthew Shay, president and chief executive officer of the NRF. “A nationwide rail strike during the peak holiday season will be devastating for American businesses, consumers and the U.S. economy.
“American businesses and families are already facing increased prices due to persistent inflation, and a rail strike will create greater inflationary pressures and will threaten business resiliency,” Shay said. “Congress must intervene immediately to avoid a rail strike and a catastrophic shutdown of the freight rail system.”
A strike would idle more than 7,000 freight trains in the system and would cost more than $2 billion daily, said the American Association of Railroads, which encouraged Congress to be prepared to act to avert a strike.
The deal with the railroads includes a 24 percent pay hike between 2020 and 2024 and addresses health and other benefits.
It’s been a down-to-the-wire vote.
The union said 50.87 percent of its train and engine service members voted to reject the deal, while 62.48 percent of its yardmasters voted to ratify.
“SMART-TD members with their votes have spoken; it’s now back to the bargaining table for our operating craft members,” said Jeremy Ferguson, president of the union. “This can all be settled through negotiations and without a strike. A settlement would be in the best interests of the workers, the railroads, shippers and the American people.
“The ball is now in the railroads’ court. Let’s see what they do,” Ferguson said. “They can settle this at the bargaining table.”
