Mediation fails in railroad talks; Biden likely to intervene

WASHINGTON, D.C. (June 15, 2022) — After more than two years of fruitless negotiations with the various Class 1 railroads and three weeks of in-person contract talks in Washington, D.C., the National Mediation Board (NMB) on Tuesday declared that a voluntary agreement is not within reach and offered binding arbitration to rail unions.

The unions representing railroad workers — who have gone without a pay raise for three years — will reject the arbitration offer, which under the Railway Labor Act sets the stage for President Biden to appoint a Presidential Emergency Board (PEB) to hear the dispute. Ultimately, if that process fails to achieve an agreement and Congress doesn’t intervene, a nationwide railway work stoppage is possible.

Greg Regan, President of the Transportation Trades Department of the AFL-CIO, released the following statement on behalf of TTD’s 37 affiliated unions, including all of rail labor, in response to the NMB’s proffer of arbitration:

“After more than three years of bad faith negotiations by the railroads, it is unfortunate but not surprising that contract agreements were not achieved through voluntary mediation. The railroads’ offer of a net pay cut and demand for health care concessions are wholly unacceptable.

“After exhaustive mediation, the NMB has now proffered binding arbitration. Our goal from the beginning of this process has been to deliver a contract that rail workers deserve, and that they can ratify, particularly as the railroads are raking in their highest-ever profits on the backs of workers. Because binding arbitration inherently means that rank and file union members will not have the option to vote on their contract — which is their constitutionally mandated right — rail labor will reject the offer of binding arbitration. We will continue to adhere to the letter of the law in the contract negotiation process, while rail workers — who have not received a pay raise in three years — continue their work as frontline pandemic heroes who are moving cargo and goods through the supply chain.”

Railroad workers are frustrated not only about not getting any raises since 2019, but also because of mass layoffs and the imposition of strict attendance policies by BNSF and Union Pacific. Over the last six years, the leading freight carriers laid off 45,000 employees, or nearly 30 percent of their combined workforce, according to the Surface Transportation Board. The railroads have also proposed to cut he minimum size of rail crews from two people to just one.

The workers want to be compensated for keeping the railroads running during the pandemic and they want their pay to increase enough to offset inflation, but they have been stymied at the bargaining table by what they consider two years of bad-faith negotiations.

“The railroads have still refused to make an offer remotely close to what their employees would consider ratifying,” said Dennis Pierce, the national president of the Brotherhood of Locomotive Engineers and Trainmen, told the Associated Press.

This week’s formal rejection of the NMB proffer will begin the first of three maximum 30-day cooling off periods. It is expected that a PEB, a panel of experienced labor arbitrators that will investigate and make non-binding recommendations for settlement, will be appointed before the end of the first 30-day cooling off period that begins June 17.

Once appointed, a second maximum 30-day clock begins ticking while the PEB hears evidence from both parties and issues its non-binding recommendations. The third 30-day clock then begins ticking, during which the parties review PEB recommendations and make a final effort toward a voluntary settlement.

If not, the RLA dispute resolution process has run its course and unless Congress intervenes, either side may take so-called “self-help,” meaning a strike or lockout.