Rail Unions and Employers Have a Tentative Agreement — but a Strike Isn’t Off the Table

The nation has watched as a labor dispute between railworkers and carriers escalated, prompting federal government intervention. The unions and bosses have a tentative agreement, but whether it’s strong enough for union members to ratify remains to be seen.

Threatening to strike if their demands aren’t met, railroad workers are want better pay, paid time off, and sick days. (Eddie Bugajewski / Unsplash)

Over the last few days, the country has been jolted into reckoning with the profound implications of a national freight railroad worker strike. Though some journalists with knowledge of the rail industry or the labor movement have been sounding the alarm for months, the last twenty-four hours have seen mainstream media outlets publish increasingly frantic articles about the potential for a strike.

In the early hours of Thursday morning, the White House announced a tentative agreement between the major rail carriers and the remaining holdout unions, Teamsters’ Brotherhood of Locomotive Engineers and Trainmen (BLET) and the Transportation Division of the International Association of Sheet Metal, Air, Rail, and Transportation Workers (SMART-TD).

The agreement still needs to be ratified by members, a process that will play out over the next few weeks. Though not all details have been released, it appears that the rail unions made limited but meaningful gains on some key issues, while holding the line on others.

Given the combative willingness of rank-and-file rail workers to vote down contracts recently, it shouldn’t be simply assumed that workers will vote in favor of accepting the agreement. For many rail workers this is not simply another contract; it could determine whether they decide to stay in the industry altogether or not.

The proposed agreement includes the best wage increases for rail workers in over forty years. Workers would have a 24 percent wage increase by 2024, including an immediate 14 percent raise. The union also managed to win no increases to health care co-pays and deductibles, a key sticking point that was underreported in the media. Two-person crews are protected in this agreement, a critical safety issue that the carriers have been trying to attack.

On paid time off and sick days, perhaps the most defining issue of the dispute, the gains are more ambiguous. Rail workers have no sick days and a very limited amount of paid time off, making the job increasingly unsustainable for any kind of family life. In a letter from SMART to Congressional leadership yesterday, the union said, “The railroads have taken away our members’ ability to be a worthy parent and dependable spouse, and they have eliminated any realistic means for an employee to receive medical services.”

The tentative agreement allows workers to take some unpaid sick days without losing attendance points, though it still is not known exactly how many. Workers would be granted only one single paid sick day. This is a far cry from the rail unions’ original demand of fifteen paid sick days. As Bernie Sanders pointed out yesterday during his testimony in Congress, it would cost the rail carriers a total of $688 million per year to fulfill this demand. While that may sound like a lot, that figure is less than 3.5 percent of their massive annual profits.

In fact, the rail carriers are profiting more than ever as they push their workers to the breaking point. The adoption of precision schedule railroading has dramatically reduced the number of workers, while delivering immense gains to Wall Street. Instead of investing these profits in its workers or rail infrastructure, the carriers have spent $196 billion on stock buybacks since 2010.

As more details come out, it is now up to the rank and file to discuss the agreement and cast their vote. The Biden administration is breathing a (perhaps temporary) sigh of relief, as it pulled out all the stops to avert a strike.

Biden himself got personally involved and phoned in to the negotiations that Labor Secretary Marty Walsh convened. White House aides worked to create contingency plans for the supply chain in the event of a strike. Republicans attempted to pass a resolution that would have enabled Congress to force workers to accept a deal, which was fortunately blocked by (who else) Senator Bernie Sanders.

This panicked response from political elites and media institutions was not completely unfounded; a rail strike would indeed have caused a crisis in our supply chain and the general economy. These recent events have reinforced a fundamental truth about US economic life.

Despite all the talk of a postindustrial and service economy, there is no getting around the fact that our economy still cannot function without industrial labor. Even as fewer things are manufactured in this country, a whole lot of products are transported and warehoused here. As this logistics system becomes more interdependent and fragile, the potential leverage of these workers increases to a dramatic level.

As this recent crisis revealed, a strike of even just some of a relatively small number (115,000) of rail workers could completely upend the economy and provoke a political crisis. While it’s misguided to put all focus or hope onto one section of the working class, we can’t ignore this immense latent power that logistics workers possess. Clearly the upper echelons of the state haven’t forgotten this, as President Biden’s intense involvement in brokering a settlement demonstrates.

Regardless of whether this tentative agreement is approved or not, deep issues with the rail system will remain. Trucking and shipping companies have been slowly recovering from supply chain issues caused by COVID-19, but things have gotten worse in rail. Shippers are reporting more delays and higher rates in 2022 than the previous two years. This could cause more companies to ship goods by truck, which in turn could lead to a downward spiral in the rail industry with further cuts to an already beleaguered workforce.

Zooming out to a broader view, this labor dispute is one more sign of a growing restlessness and combativity among US workers. Importantly, this development is happening both among unionized workers and unorganized workers forming unions.

During the “Striketober” of late 2021, rank-and-file workers at companies like Kellogg’s and John Deere voted down substandard agreements and won better contracts in the end by doing so. International Alliance of Theatrical Stage Employees (IATSE) workers had the attention of the country as they almost went on strike over unsustainable work schedules, similar to the rail labor dispute. Momentum is already building for the highly anticipated United Parcel Service (UPS) contract fight in the summer of 2023.

More recently, unexpected organizing has taken place at high-profile companies like Amazon, Starbucks, and Chipotle. We don’t know where or how far all this energy will go, but it’s clear that the question of labor will dominate politics in the years to come. Railroad workers have reminded us that the issue of work in this country is too explosive to ignore.