Increasingly likely on Sept. 16, or shortly thereafter, is a rail labor strike or management lockout creating a nationwide rail shutdown that almost certainly will elicit from Congress back-to-work legislation and third-party determination of wage, benefits and work rules amendments to end this almost 33-month-old round of collective bargaining.
Update: Brotherhood of Locomotive Engineers and Trainmen President Dennis Pierce, who faces reelection this fall, reportedly told the Biden Administration Labor Department over the weekend (Sept. 10-11) that he “cannot” do a deal. Labor-friendly congressional Democrats reportedly are furious, as a nationwide rail work stoppage—whether caused by a labor strike or management lock out—will work against Democratic mid-term election hopes by focusing voters on a new round of inflation, empty grocery store shelves, and Christmas-season product shortages when Democrats prefer focusing voters on issues difficult for Republicans to defend. So sensitive is the rail labor issue among Democrats—who just want it to go away—that only Sen. Bernie Sanders (I-Vt., who caucuses with Democrats and is allied with socialists) spoke out on it over the weekend.
Since January 2020, all 12* rail labor unions have been negotiating with the National Carriers Conference Committee (NCCC) that represents most Class I railroads and many smaller railroads. Unlike in most other unionized industries, railroad labor contracts negotiated under provisions of the Railway Labor Act (RLA) never expire. They remain in force until voluntary agreements are reached, or, in the event of a rare work stoppage after RLA provisions run their course, Congress imposes a legislative settlement.
Historically, voluntary agreements are preferred by labor and management, as third-party settlements are a trick bag into which neither labor nor management wishes to be placed as they lose all control over the outcome. Yet if such occurs on or after Sept. 16, it will be the result of their own doing.
Rail carriers—clumsier even than British comic-actor Mr. Bean in their interpersonal relationships with employees—so carpet-bombed worker morale and employer loyalty in recent years that ratification of tentative agreements reached (or on the cusp of reaching) by 10 of 12 unions is heavily tainted with probability of member rejection.
Worse is that the carrier relationship with members of the two largest rail labor unions—representing train conductors and locomotive engineers—is so contemptible that members are beseeching their leaders for permission to “shut ’em down,” creating little incentive to reach even a tentative agreement that would face a Mount Everest-height hurdle of being ratified.
Union leaders are not blameless. Their relentless administering to members of an intravenous drip of concentrated vitriol against rail management has so incensed the rank-and-file that even esteemed agents of peace—reaching back to Mahatma Gandhi and including the Dali Lama and the Pope—couldn’t now bridge the divide.
Add to this “what could go wrong?” scenario a rancid stew of many ill-equipped contract negotiators—most either inexperienced in rail labor issues, lacking seasoning as chief spokespersons, and/or unfamiliar with those on the other side of the bargaining table.
During previous rounds of national contract talks, each side had numerous bargaining representatives experienced in successful negotiations and the nuances of translating complex contract language into side-letter clarifications written in layperson terms. They were so familiar with precedent, predilections and personalities that the outline of deals foretelling successful tentative agreements and their ratification by affected union members often was forged on the golf course and at noisy bar-room tables early into the next morning.
This round, besides having an exceptionally large roster of newbies, was adversely impacted by the COVID-19 epidemic that limited face-to-face negotiations and, especially, informal socializing and bonding.
If this round goes to Congress to settle—a virtual certainty, given the importance of railroads to the national economy and defense—a pattern on wages and benefits appears fully embroidered through tentative agreements reached (or on the cusp of reaching) with 10 of the 12 unions and in comments from the negotiating teams of SMART-TD and BLET.
Congress need only cut and paste into legislation the non-binding settlement recommendations of Presidential Emergency Board No. 250. This would satisfy carriers and the union leadership satisfied with the deal but having trepidations of selling it to members for ratification given the well of once relative goodwill these labor leaders fouled in recent years.
The wicket that neither negotiators nor Congress may be unable to unstick encompass work rules affecting SMART-TD and the BLET—a MERSA-like festering wound of carrier crammed-down attendance availability policies and unpredictable work-rest cycles that train and engine service employees insist are destructive of family values and worker mental and physical health.
In a final National Mediation Board-guided bargaining session last week, following release of the PEB recommendations, SMART-TD and BLET held firm in demands beyond what the PEB recommended and regurgitated demands the PEB had rejected. Carriers, meanwhile, declined to compromise and held firm that they will accept nothing other than the PEB recommendations.
Barring an unlikely successful labor-friendly push in Congress by lawmakers sufficiently incentivized by union political campaign donations, legislation ending a strike or lockout is unlikely to deliver the work rules outcome sought by conductors and engineers. SMART-TD and BLET will be using all of their congressional lobbying power and expertise to gain more than the PEB recommend on work rules—a Hail Mary if there ever was one.
Labor may have many Democratic friends in the House and Senate thankful for millions of dollars in political contributions provided by labor, but carriers have far more Republican friends where even a single Republican senator can block that chamber’s Democratic majority from passing.
As shippers watch events unfold this week—including carriers securing expensive assets and limiting hazmat incident exposure by repositioning locomotives, annulling freight trains and curtailing service—they had best, in seeking answers to “what next” and “for how long,” not swim in the cesspool of misinformation that will increasingly appear on social media and in press releases of railroads and their labor unions. If a work stoppage occurs, each side will spin it as the fault of the other as each side attempts to avoid the wrath of a Congress despising a rail shutdown just weeks ahead of mid-term elections.
Indeed, the fog of war is not limited to military engagements. Moreover, as it has been more than three decades since a previous nationwide rail shutdown, institutional knowledge of such events is largely extinct in Congress as well as among union and carrier negotiators and shippers.
The available truths are:
- The significance of Sept. 16 is that it is the date on which the Railway Labor Act has run its course. While on that date labor may strike or carriers may lockout, neither is foreordained. Neither side has made an actual threat.
- Rail contracts never expire, but remain in force until amendments are voluntarily reached or Congress imposes a third-party settlement. The phrase, “no contract, no work” does not exist in the rail industry.
- Already, carriers and 10 unions with (or on the cusp of reaching) tentative pacts have agreed to maintain the status quo while those unions seek member ratification.
- Even if SMART-TD and the BLET fail to reach tentative agreements by Sept. 16, neither is under an obligation to authorize a strike. Their members would continue working under existing contracts—even if and as other unions ratify amended agreements. The two unions could continue to negotiate beyond Sept. 16, if carriers are willing.
- Carriers could, on or after Sept. 16, precipitate a lockout on the assumption that subsequent and quick congressional action will favor railroad interests rather than continued negotiations. A management lockout is as great a likelihood as SMART-TD and/or BLET authorizing a strike.
- A selective strike is most unlikely. SMART-TD or BLET could selectively strike just one or two railroads, but, as occurred when only CSX was struck in June 1992, all carriers would respond with a lockout as the nation’s rail network is so interconnected that a shutdown of one would create havoc on most others.
- While Congress in the past has reacted within days or hours to a nationwide rail shut down with back-to-work legislation—its terms either imposing PEB recommendations, something close or them, or binding arbitration—current congressional dysfunction, especially so close to mid-term elections, could delay legislation and prolong a rail shutdown for an indeterminate time period.
- While unions have strike funds to assist members losing paychecks and even carrier-provided healthcare insurance, those resources are limited. SMART-TD, for example, with some 37,000 members, would have to find in its reserves in excess of $3.7 million daily even if members were provided only $100 daily. Those benefits are not paid until after three days. The federally administered Railroad Unemployment Insurance Act—jointly funded by carriers and rail employees and similar to Railroad Retirement—provides for unemployment benefits to striking rail workers, but not until after the seventh day of a strike.
- Carriers, meanwhile, have a little known and 100% carrier-financed and administered Service Interruption Plan to indemnify carriers for revenue losses during strikes and lockouts.
* The 12 rail unions bargaining with carriers are: the American Train Dispatchers Association; Brotherhood of Locomotive Engineers and Trainmen; Brotherhood of Maintenance of Way Employes; Brotherhood of Railroad Signalmen; International Association of Machinists; International Brotherhood of Boilermakers; Mechanical Division of International Association of Sheet Metal, Air, Rail and Transportation Workers (SMART); National Conference of Firemen & Oilers; International Brotherhood of Electrical Workers; Transport Workers; Transportation Communications Union (including Brotherhood Railway Carmen); and Transportation Division of SMART (including Railroad Yardmasters of America).
Class I carriers represented at the bargaining table by the National Carriers Conference Committee (NCCC) are BNSF; Canadian National; CSX (although it is negotiating wages and work rules separately with SMART-TD and BLET); Kansas City Southern; Norfolk Southern; and Union Pacific. Canadian Pacific is negotiating separately with all its unions. Many smaller railroads also are represented by NCCC.
Railway Age Capitol Hill Contributing Editor Frank N. Wilner is author of “Understanding the Railway Labor Act.” He formerly was director of public relations for SMART-TD and its United Transportation Union predecessor, an assistant vice president for policy at the Association of American Railroads, and a White House (Bill Clinton) appointed chief of staff at the Surface Transportation Board.