The 2022 general railroad strike is widely regarded as a low point of national labor relations in recent memory. It was put down by an act of Congress to avoid massive supply chain disruptions at Christmastime.
In contrast, the latest round of negotiations was all but over by the end of last year, and with a built-in wage hike for rail workers of 18.8% over five years and capped or reduced employee contributions for healthcare and other benefits.
It’s human nature to always want more, but there are clear signs that rail workers themselves think of this as a pretty good deal.
“When you’re at the bar and hear the longshoremen bragging about the $65/per hour they are going to make in 2030, just know that you were pulling in $73.16 two years ago and have had two raises since,” the International Association of Sheet Metal, Air, Rail, and Transportation Workers had to say to its freight workers about their compensation in January.
The average annual base pay for rail workers will rise to about $135,000 by 2029. With benefits, that pay package will be worth about $190,000, according to a news release by the National Railway Labor Conference, which negotiates the framework agreement with the 12 major railroad workers’ unions on behalf of the railroads.
And note that those figures do not even factor in overtime, which is significant. It isn’t uncommon for rail workers to make more than $200,000 a year, and the latest pay bump will only make it easier to take home what most would regard as a hefty paycheck.
How rail keeps moving
The latest round of talks moved along with the efficiency of steel-on-steel that we really ought to expect from one of the oldest ongoing and formalized labor negotiations in American history — the Railway Labor Act, which regulates the railroads, predates the broader National Labor Relations Act of 1935 by almost a decade. Current success only highlights recent politicized dysfunction that many workers, railroads, and their customers hope to avoid in the future.
Here is how rail negotiations usually work, when they are working according to law and precedent: The NRLC negotiates a framework deal to run for several years with one or more of the rail workers’ unions. Then, what is called pattern bargaining commences.
The rest of the deals for any given round of negotiations are templated on that first deal. So if, for instance, the Brotherhood of Locomotive Engineers and Trainmen union negotiates a 15% raise, then all of the rail-related unions will insist upon, and receive without objection from the railroads, 15% raises.
The unions can negotiate over just about anything with the railroads, but they have historically focused on wages and benefits, with healthcare getting the most attention among those benefits.
This whole process can take a while, which can be annoying to workers. This is partially accounted for in the current system. Some of the new raises are applied retroactively to when talks began, which means that the conclusion of negotiations and ratification of the new contract results in bonuses for every single rail worker.
Rail workers received lump-sum payments averaging more than $11,000 in 2022, for instance, after their union negotiators opposed a proposal by the NRLC to top up workers while talks were ongoing.
Then, with the larger negotiation out of the way and workers paid and salaries adjusted, unions negotiate with individual railroads over things that were not considered huge issues — or were matters that, at least, vary according to the type of work and other local conditions. For this reason, these are called local agreements.
To impasse and beyond
The round of negotiations that led up to the threatened 2022 strike was extremely frustrating to many parties, for wholly different reasons. The negotiations dragged on for several years, from 2020 to the spring of 2022.
This frustrated the railroads, which wanted to know how to price freight to account for labor and to avoid a work stoppage; workers, who quite understandably wanted more money in those paychecks in the midst of runaway inflation; and shippers, who wanted to know what this would cost them, assuming the trains even kept running.
Because of the devastating nature of a national railroad strike, federal law imposes several steps that railroads and the rail workers must go through before a shutdown is possible. The most important of those steps is probably when the parties take their negotiations to the National Mediation Board.
The NMB is an agency of the federal government that “helps to maintain the flow of interstate commerce in the airline and railway industries through representation, mediation and arbitration services,” according to its own self-description. Once talks move to the NMB, they are meant to stay there for a long time, so that the railroads and the workers’ representatives can get some things off their chests and finally arrive at a workable compromise to keep freight moving.
That is not how talks proceeded in 2022, however, and politics was a clear culprit. “Mediation had barely begun when an assigned and highly respected NMB staff mediator was shunted aside by the three Board members who took charge of mediation,” the trade publication Railway Age reported in June of that year. And then, “Two weeks later and over remonstrances of management and the Republican member, the NMB’s two Democratic members voted to declare, in record time, a bargaining impasse.”
Facing the real possibility of a general strike at election time, then-President Joe Biden appointed a Presidential Emergency Board, another one of those steps provisioned for by federal railroad labor law, to do the job that the NMB would not. The PEB recommended large raises for workers, which the railroads agreed to. The union negotiators, after some grumbling, also endorsed the deal.
Labor deal in distress
That would have been the end of it except that, after several unions had already ratified the deal, a few began rejecting it. They did so over concerns of rank-and-file workers about time off.
The Brotherhood of Maintenance of Way Employees voted to reject the contract in October, and then the Brotherhood of Railroad Signalmen followed suit, creating the real possibility of a full rail strike. Eventually, several of the 12 rail worker unions rejected the deal.
The railroads were at a loss for what to do. Their side of the story is that leave simply had not been a significant issue that unions had pushed for at the negotiating table, though it had been part of an expensive, everything-and-the-kitchen-sink-style proposal put before the PEB and rejected by Biden’s temporary appointees. The normal — productive — avenue for rail workers to get more paid time away from work had been to first ratify the larger contract and then to get more sick days, vacation, and other types of leave in the rounds of negotiated local agreements.
Yet at that moment, momentum appeared to be carrying the whole process toward what sure looked like a bad outcome, like one of those old movies with a damsel tied to the tracks. The outgoing House speaker, Rep. Nancy Pelosi (D-CA), saw it that way. She spelled out the problem for rail workers and the wider economy.
Such a strike would “grind our economy to a halt,” Pelosi warned in a statement. “Our entire nation would suffer: More than 750,000 workers, including many union members, would lose their jobs in just the first two weeks. Millions of families wouldn’t be able to get groceries, medications, and other goods, and our economy would be paralyzed as it continues to recover.”
Because of those fears, Congress and the White House acted. They accepted the contract on behalf of the holdout unions and put out the brewing strike. Rail workers went along with it, likely because that would have been a less-than-ideal issue to grind a large part of the economy to a halt over.
Changed politics, better negotiations
A changed political climate has helped some to grease current-day rail negotiations. President Donald Trump fired Deirdre Hamilton, one of the Democratic appointees at the NMB, who did so much to create the crisis last time, though she is challenging the termination in court. Another thing that helped was the real progress that occurred after Congress acted.
Progressive members of Congress said they ought to impose more time off as a condition of foreclosing a strike. Pelosi herself flirted with adopting this position.
The railroads’ rejoinder wasn’t so much “no” as “let us negotiate.” During and after the 2022 brinkmanship before Congress, the railroads insisted through their trade group, the Association of American Railroads, that they opposed concessions that did not happen at the negotiating table and that leave was a reasonable thing to consider in the coming local negotiations.
Cynics and critics of the railroads took this to mean that the issue of paid sick leave and other time off was dead. “Rail strike is cancelled – at the cost of paid sick leave,” the BBC headlined one story. Yet, the opposite result was at the end of the tunnel.
“Rail unions reach deal with CSX railroad for paid sick time.” That headline comes to us via CNN. We could quote any of a dozen or more headlines reporting on the local deals struck after the 2022 imbroglio, showing that a local deal was inked, and quickly, following negotiations that had dragged out for years.
Similar stories kept rolling down the line as the year progressed, in news outlets and news releases. A few representative headlines: “Norfolk Southern announces additional paid sick leave agreements with mechanical and engineering railroaders” (March 14); “Union Pacific Railroad Reaches Paid Sick Leave Agreements with Eight Labor Unions” (March 22); and even some competitive bragging among railroads, with, “Norfolk Southern is 1st railroad to give all workers sick time as others negotiate with unions” (June 5).
The railroads pledged to deal with the problem of leave through local negotiations after 2022, and then largely made good on that, in other words. In this latest round of negotiations, the railroads agreed to some leave provisions in the larger framework agreement, which also included so much more money and benefits for workers that their own unions are bragging about it.
And the proof of the pudding is in the voting: At press time, 11 of the 12 rail unions had fully ratified contracts based on the framework deal, and the one holdout, the Brotherhood of Railroad Signalmen, had partially ratified it.
Future challenges for the railroads
Biden administration Transportation Secretary Pete Buttigieg complained that railroads are “almost ridiculously profitable,” and first-quarter reports for this year mostly underlined that point. Earnings for railroads CSX and Union Pacific were up 25% and 5%, respectively. For now, goodwill from the time-off negotiations and the money flows are helping to smooth over political differences between management and workers. But those are surely coming down the tracks.
MARYLAND IS EXPECTED TO BAN SURVEILLANCE PRICING. HERE’S WHAT THAT MEANS FOR CONSUMERS
Union Pacific and Norfolk Southern are attempting an $85 billion merger that would create the first transcontinental, single-line railroad, for one. That is sure to draw some regulatory scrutiny and likely pushback from unions, as efficiencies created by the merger could shed some jobs.
More broadly, there is a struggle between the unions and the railroads over the issue of automation that shows no likelihood of stopping at the station. Improved electronic monitoring of tracks will likely cut down on the number of track walking inspectors needed in the future, for instance. The Railway Safety Act, which would lock crew sizes in place, has close to enough votes to pass in the current narrowly Republican Senate. Depending on how the midterm elections go, a future Congress could fast-track that legislation.
Jeremy Lott (@jeremylottdiary) is the author of several books, most recently The Three Feral Pigs and the Vegan Wolf.