Freight rail workers are on the verge of striking for better pay and working conditions, a move that would cap years of stalled negotiations. In a recent vote, 99.5 percent of the members of the Brotherhood of Locomotive Engineers and Trainmen (BLET), a union leading a coalition of freight rail workers in negotiations, authorized a strike.
If it was simply a matter of management versus labor, a strike would likely already have started. But rail workers occupy a peculiar area of labor law, one governed by a century-old federal law that gives Congress and the president wide powers to avert strikes, even though this labor remains the most powerful threat workers have to get better wages and working conditions.
The situation is complicated and it is still far from certain what will happen next. But, should a strike actually take place, it would have a huge impact on the American economy, which is exactly why the government will try to avoid it.
What are the issues?
Several issues that have been bubbling for a long time are finally coming to a head. The railroads and unions have been negotiating a new contract since 2019; the various unions representing freight rail workers generally bargain as a coalition against the biggest rail carriers in the country (only one, Canadian Pacific, is negotiating entirely separately). Years of negotiation, interrupted for a period by a global pandemic, have yielded little agreement.
Since the contract ended, wages have not budged while negotiations are underway. Raises agreed to in a new contract would be retroactive to when the old contract expired, but the parties are far apart on what those raises would be. According to the Transportation Trades Department, a group that represents among others the 13 rail worker unions involved in negotiations, the unions proposed an increase of 31.2 percent over five years, while the railroads reportedly want 17 percent.
Health care is also a sticking point. The unions are basically after the status quo, but the railroads want employees to pay a bigger share of the costs. According to Railway Age contributing writer Frank Wilner, employees contribute $228.89 monthly towards their coverage regardless of family size, while the employers pay about $1,600. The railroads want employees to be paying more, especially employees with families.
But the biggest issues have to do with working conditions. Broadly, workers feel the railroads, responding to investor demands, are exploiting their workers and customers for the sake of ever-increasing profits. Workers have been asked to do more with less, which they say is making the railroads less safe. New attendance policies make working for the railroad a living hell. And shippers who send goods along the rail are equally fed up with the railroads for degrading service standards, a result of the same cost-cutting measures workers are angered by.
The railroads are also pushing for one-person train crews on many routes, saying the second person is no longer necessary with modern technology and will enable them to compete with (hypothetical) driverless trucks, a contention many workers disagree with and say will make the railroad less safe and service even worse. Meanwhile, the railroad companies report record earnings and profits.
For their part, the railroads say none of the workers’ concerns are legitimate, that safety is as good as it’s ever been, that there may be isolated service problems, but broadly service standards are high and everything is fine. Insofar as there is a problem, the railroads blame crew shortages due to pandemic-related reasons, not from slashing more than 25 percent of the industry’s workforce in the years prior to the pandemic.
So although there are specific issues at play, they are in service of a broader feeling among the workforce that management has created a “toxic workplace,” in the words of BLET president Dennis Pierce, to pad the bottom line. There is anger and frustration; they've been forced to work through the pandemic as essential workers only to be infantilized with even more draconian attendance policies. Which is why the workers have overwhelmingly voted to authorize a strike.
But they cannot strike. Not yet at least. And the reason is because the federal government considered railroad workers essential long before the pandemic—to such a degree it felt the need to intervene in labor disputes.
How the federal government got involved
In order to understand what the federal government’s deal in all this is, we have to go back in time to the late 19th Century, one of the most dire periods for worker rights in the history of capitalism. The BLET is one of the oldest labor unions in the world, formed in 1863 amidst one of the most exploitative industries on the planet. About four in every thousand workers died each year on the job, meaning a worker over a 20-year career would have an eight percent chance of dying on the job, little different than a game of Russian roulette with a 12-chamber revolver. Tens of thousands more were injured every year, often suffering debilitating injuries like losing a limb or getting paralyzed, with little or no protection or insurance. The two most dangerous jobs in the U.S. at the time were working in the railroads and coal mines.
Many of the risks stemmed from railroad management themselves. The companies simply did not care about the workers, who were largely perceived as expendable. Unions were formed in large part as a response not just to wage exploitation but also to force safety improvements.
The 1870s and 1880s were a period of tremendous labor strife due to massive inequality and a series of economic panics where companies demanded workers take massive wage cuts to compensate for losses from rampant financial speculation. But the railroads were the epicenter. In this era before cars and trucks, railroads were the way to move people and goods across land, so workers had ample leverage. When railroad workers went on strike, it had a huge ripple effect across the economy.
This, of course, was the whole point of workers going on strike, to exert leverage as essential workers to society and be treated as such. Strikes were also different to what they are today, violent affairs in which both sides literally tried to starve or beat resistance out of the other. But, many federal judges and government officials at the time believed it ought to be illegal for any worker anywhere to strike, especially railroad workers. In several cases, including the 1894 Pullman Strike, federal troops were dispatched to end hostilities.
Congress attempted multiple methods of resolving labor disputes without these mini-wars, including but not limited to the Arbitration Act of 1888, the Erdman Act of 1898, the Newlands Act of 1913, and the Esch-Cummins Act of 1920. The idea behind all of them was to create some kind of mediation or arbitration procedure where a third party would resolve disputes before strikes took place. They were all varying degrees of failures, as evidenced by the frequency of labor disputes and strikes in the early 20th Century, culminating in the Great Railroad Strike of 1922 which lasted for one month and collapsed after a conservative judge issued an injunction against union action.
But in 1926, Congress passed the Railway Labor Act (RLA). This one stuck—getting slightly amended in 1934 and 1966—and is still in effect. And this is the law that is affecting railroad workers now.
Why railroad labor disputes are different
Most labor disputes between a private company and its unionized workforce follow a basic pattern, which goes very roughly as follows: When a contract is about to expire, the union and company try to negotiate a new one. If they can’t and the contract expires, the workers can take various forms of action up to and including a strike. There are options for mediation through the National Labor Relations Board and other rules that must be followed under the National Labor Relations Act of 1935. And state and federal governments play important roles in setting the general rules of labor law. But the government’s role is otherwise minimal in any individual dispute. It is between the union and management.
Not so for freight rail workers. Under the RLA, failure to negotiate a new contract triggers a series of events, all designed to avoid a strike and the disruption in the economy it would cause. In theory, it saves the country from unpleasantness. In practice, it may do that, but it also strips railroad workers of the labor rights other unionized Americans have.
First, unions are outright banned from taking labor action for so-called “minor disputes,” which means anything other than the terms of a collective bargaining agreement being negotiated. This is a huge deal, because it means workers cannot take action, such as sick outs or slow downs or pickets or any other collective action, to express discontent with, say, draconian attendance policies, giving management more leverage to enact them. It means the only time workers can have their voices collectively heard is during bargaining, a time when a number of other restrictions are placed on them.
If bargaining doesn’t go well, workers cannot simply strike when the clocks strike midnight on the old deal. Technically, railroad worker contracts don’t expire, but are negotiated by the company or unions triggering a “Section 6 notice” to start the negotiating process.
Then, after some period of negotiation which rarely results in a deal, the parties go to mediation under the National Mediation Board (NMB), an executive branch office. If mediation reaches an impasse, both parties can consent to binding arbitration, meaning a neutral third-party arbitrator determines the new terms of the contract both parties must accept. If either the railroads or the unions don’t want to do this, the federal government gets more involved. In this case, the unions declined binding arbitration.
After a 30-day cooling off period, if the NMB thinks the dispute could result in a significant disruption to the economy, it will notify the President.
The President can then do one of two things: Either create a Presidential Emergency Board (PEB), a three-member panel to hear everyone out and craft its own deal, or, the President can do nothing, allowing events to take their course, up to and including a strike.
In this case, Biden, like all of his predecessors, chose to create a PEB. This triggers a new timeline. The PEB has 30 days to issue its recommendation followed by a mandatory 30-day cooling off period. At this point, the two sides can either accept or reject the recommendation. Both sides—and all the member unions and companies involved—must agree to end the impasse. If they reach a tentative agreement, the members of each union must ratify it.
That’s a lot of “ifs” in order to reach a deal, and if any of them fail, a strike or lockout can happen.
Unless Congress stops them.
Where things stand and what happens next
Currently, we are in the PEB stage of the process, in the middle of the 30-day window when the panel conducts its study. The end of the cooling off period will hit in mid-September.
However, the timeline isn’t as definitive as it sounds. Congress can intervene at any point by passing a law to basically do anything they want. They can, as Wilner pointed out, create a second PEB to kick the can down the road. Congress can also end or ban a shutdown, either in advance or once it has started. It can legislate that the PEB’s recommendations go into effect, or it can write its own deal.
Whether Congress will actually do any of this is anyone’s guess. Congress, and in particular the Senate, is not exactly the most high-functioning governing body at the moment. But it is likely Congress is going to be forced to act in one way or another on this, for better or worse.
The next big event will be around August 15, which is when the PEB’s 30-day window to issue recommendations is up.