New Legislation Stops Strike, Yet Leaves Railway Workers With Unfair Policies

The possibility of a nationwide rail strike was averted, effective December 2, 2022. Realizing that a strike on our nation and overall economy could be detrimental, President Biden called for Congressional intervention. This is in accordance with the Railway Labor Act (RLA).  

Last August, the Biden Administration had to become directly involved to help manage and find a resolution to ongoing contract disputes between major freight railroads and rail labor. In September, a Presidential Emergency Board (PEB) was established. Thirty days later, there was still no agreement, so the White House and Secretary of Labor brokered a tentative agreement. The agreement offered the unions a five-year, twenty-four percent pay increase and annual thousand-dollar bonuses. Yet, on the primary issues of sick leave and unreasonable discipline policies, the railroad would only concede to one paid personal day.  

In the end, members from four of twelve unions (just over half of the rail workers) voted to reject the tentative agreement from the President’s Emergency Board’s Report. This resulted in the House passing two pieces of legislation on November 30^th.  

• The first, by a vote of 290-137, to impose the tentative agreement. 
• The second bill added seven days of sick leave and received a vote of 221-207. 

The Senate then moved to avoid a strike and passed the house bill imposing the tentative agreement by a vote of 80-15 but rejected the second bill to add sick days by a vote of 52-43. President Biden then signed the legislation into law, banning any prospect of a rail strike. 

The accordant grievance at the helm of the dispute dealt with inhumane working conditions and the need for workers to be allowed to mark off on paid sick days to tend to their health or family issues without being punished with extreme disciplinary action such as being possibly fired. 

Many freight rail issues are due to the new operating systems under Precision Scheduled Railroading (PSR). Tremendous profits from Wall Street hedge funds come at the expense of employees being cut to reduce costs. Since 2016, the yearly average of those employed on Class 1’s has fallen by thirty percent. A study at the U.S. Government Accountability Office (GAO) found that by 2017, train lengths grew by twenty-five percent for two Class 1 railroads, all are running longer trains. Some even extend for several miles! The GAO also stated that freight rail investment strategies continue to increase train length annually.  

The loss of employees means maintenance schedules on tracks and trains and other safety measures are likely being ignored. The use of PSR is aggravating for shippers, rail customers, and other entities, including The National League of Cities and local and state officials. They all complain to the GAO about the length of the trains blocking crossings, creating heavy traffic jams, and worse causing problems for emergency response vehicles. “Wall Street may not care, but Main Street does” (Fortune magazine 2021). 

With the PSR models, they will run one three-mile train instead of three one-mile trains just to cut costs on labor. STB members are irate at the railroads stating that workers have been cut down to the bare bones. They are using fewer workers to do the same amount of work. Rail Passengers Association (RPA) worries that this agreement fails to address the significant issue of harsh working conditions. 

Martin Oberman, Chair of the STB, says, “Over the last six to seven years, through ever-increasing pressure from Wall Street, the railroad’s emphasis has not been growth, rather, the emphasis has been on cutting. Over the previous decade, the five largest railroads had spent $114 billion to buy back their shares-intended to boost stock prices-rather than using that money to bolster their routes.” 

The pressure is back on as activist investment managers have filed proposals at the UP and NS to allow shareholders a vote on whether rail workers should get paid sick leave. The filings should warn that a weakened railroad workforce will eventually weaken their investments.  

If the current problems are left unresolved, they will continue to cause employees to leave the industry. However, members of both parties agree they were forced to act to avoid a railroad strike, but the issues such as quality of work or family problems need to be addressed. 

NARVRE is hopeful that better solutions are on the horizon and that everything will be worked out to keep and return rail employees to work. Railroad retirement depends on it. If you have or currently work for the railroad and are not yet a member of NARVRE, we encourage you to join today. We work diligently to PROTECT, PRESERVE, and PROMOTE your railroad retirement benefits.  

*This blog is credited to an article in the January issue of the NARVRE newsletter, written by NARVRE National Legislative Director Gary Faley.