Congress Is Trying to Avert a Rail Strike. Here’s How and Why.
WASHINGTON — The House took the first step on Wednesday to prevent a nationwide rail strike by approving legislation that would impose a labor agreement between rail companies and their workers, one day after congressional leaders met with President Biden on the matter.
The measure now moves to the Senate, where it is facing a rocky path. Mr. Biden has urged congressional leaders to move fast as railway workers have threatened to stop working if they fail to reach an agreement by a Dec. 9. deadline, a disruption that could cost the economy an estimated $2 billion a day and hurt consumers.
The Biden administration intervened in the dispute earlier this year and negotiated a tentative agreement to increase worker pay and set more flexible schedules, but four out of 12 unions voted it down, leaving the freight railroads and the unions at an impasse.
Here’s how and why Congress is getting involved.
What does Congress have to do with a labor dispute?
Congress has the power under Article I, Section 8 of the Constitution to regulate interstate commerce, and the Supreme Court has ruled that that includes the authority to intervene in railway labor disputes that threaten trade across state lines.
The Railway Labor Act, enacted in 1926, allows the president to insert himself into disputes that “threaten substantially to interrupt interstate commerce to a degree such as to deprive any section of the country of essential transportation service,” as Mr. Biden did in September. But since that statute was enacted, Congress has had to step in 18 times when the process failed to produce an agreement.
Understand the Railroad Labor Talks
Averting a shutdown. Congressional leaders vowed to prevent a nationwide rail strike, agreeing with President Biden that it could freeze a critical piece of the economy and potentially fuel further inflation in the United States. Here is what to know:
Why are rail workers threatening to strike? Unions representing tens of thousands of workers said they planned to strike if a labor agreement with the freight rail companies employing them wasn’t reached. The workers are mostly concerned with their grueling, unpredictable schedules that make it difficult to attend medical visits or family events.
Wasn’t there an agreement reached in September? The White House helped broker a tentative deal in September, but the proposal failed to win the approval of the workers at all of the unions involved. Many workers said that that deal did not address the deeper issue underlying their concerns: a business model that seeks to minimize labor costs and results in chronic understaffing.
What was in that proposal? Under that agreement, new contracts would include a 24 percent increase in wages over five years and a payout of $11,000 upon ratification. Workers would also receive an additional paid day off as well as the ability to attend medical appointments without penalty.
What’s at stake for the economy? Rail freight is the centerpiece of the global supply chain. A strike would slow down the circulation of key goods within the United States and with overseas trading partners. A disruption to the rail transport of crude oil, gasoline and diesel, meanwhile, could push up gas prices and drive further inflation.
That is what lawmakers are trying to do this week.
What’s in the deal that Congress is trying to impose?
The Association of American Railroads, an industry group, said in September that new contracts would include a 24 percent increase in wages in the five years from 2020 through 2024. There would also be a payout of $11,000, on average, when the agreement is ratified, the association said.
In addition, the agreement gave workers one additional paid day off and an ability to attend medical appointments without penalty, labor unions said, measures that were intended to ease what workers said was a rigid scheduling system that did not allow them to take care of their health or take personal time they needed.
What happens if the bill doesn’t pass?
Freight rail carriers are the second-largest mode of freight transport in the United States. More than a quarter of U.S. freight before the pandemic was transported by railway, according to federal data. This includes important commodities like coal, lumber, ore and chemicals.
Should no agreement be reached, a strike could bring domestic transportation of these commodities to a grinding halt during one of the busiest times of the year for carriers, making it nearly impossible to transport products like oil and grain. It would also have a devastating effect on the nation’s economic recovery after the pandemic.
It would also leave railway workers, who have been working without a new contract since 2020, without improvements to pay and benefits that they have bargained for.
Why would Democrats, who are generally pro-labor, try to force an agreement on workers?
Mr. Biden and the Democrats who control Congress have said that they do not relish imposing an agreement, but that doing so is necessary to avert the dire economic damage that a rail strike could cause.
But many progressives balked at voting to force workers to accept an agreement that many of their unions had rejected because they believed it lacked sufficient paid leave. Bowing to pressure from those Democrats, some of whom had threatened to withhold their votes and block the agreement from being considered at all, House leaders also put forth a bill to add seven days of paid sick time to the contract.
It passed the House mostly along party lines, but its fate in the 50-50 Senate was uncertain.
Why can’t railroads reach an agreement with the unions?
Like many industries recovering from the adverse impact of the pandemic, employee shortfalls left rail carriers few options for maintaining business levels. Unions complained that, as a result of the labor shortage, carriers mandated that their employees work for long stretches — sometimes spanning weeks at a time — through strict attendance policies.
Industry analysts also say the conflict stems from the focus on lowering expenses like labor costs in the industry’s business model, which has left rail networks with a limited number of ways to work around disruptions like pandemics and natural disasters.
Why has sick leave emerged as a sticking point?
Workers say they were pushed to the limit of their mental and physical health because of grueling and unpredictable schedules, and they have demanded more flexible paid leave policies.
Rail carriers have resisted the demands, asserting that employees should use paid vacation time to tend to their personal lives and seek medical help. But employees have said the windows in which they can request paid leave have been narrowed, and their requests for time off rejected.