The strike by rail unions would create a “crippling” economy, warns an industry official

After a fourth US rail union rejected a deal with its employers brokered by the Biden administration – and reignited fears of a nationwide rail strike – a railroad company spokesman said they were “ready, willing and able ” to reach new negotiations.

“We have to keep the network moving. We have to keep the economy moving,” Ian Jeffries, president and chief executive officer of the Association of American Railroads (AAR) told “Varney & Co.” Tuesday. “And that’s why we are ready, willing and able to reach new voluntary agreements. And in the absence of that, we believe that Congress may need to be ready to intervene as it has historically.”

Jeffries’ comments come just after a fourth rail union rejected a tentative deal with the nation’s major freight railroads, raising prospects of a nationwide strike that could bring the economy to its knees in the midst of the holiday season.

Members of the Transportation Division of the International Association of Sheet Metal, Aircraft, Rail and Transportation Workers (SMART-TD), representing more than 28,000 workers, issued a split decision in the vote count announced Monday. The Yardmasters represented by SMART-TD voted to ratify their contract, but a smaller group of approximately 1,300 train and engine service members voted against their separate contract.


All 12 unions involved in the negotiations must ratify their new agreements to avoid a possible work stoppage, which would decimate already fragile supply chains in the middle of the holiday shopping rush. While eight have already agreed to the deal negotiated by President Biden’s Presidential Emergency Board (PEB), a strike could happen as early as December 9.

Railroad companies are “ready, willing and able” to reach new rail union agreements, Ian Jeffries, president and chief executive officer of the Association of American Railroads, told “Varney & Co.” Tuesday 22 November 2022. (Getty Images)

In October, the AAR estimated that disrupting supply chain strikes would cost the US economy $2 billion a day.

“This is exactly why we must do everything we can to avoid an economic cripple, a work stoppage that is not in anyone’s best interest,” Jeffries said Tuesday. “Not the interests of our employees, not the interests of carriers, not the interests of our customers.”

While the original deal gave railroad workers a 24 percent pay raise over a five-year period and thousands of dollars in bonuses, some unions have expressed concern about a lack of sick leave.

“The [National Carriers’ Conference Committee] you said we have sick pay, that’s true. But to start claiming benefits, you need to be free 7 days – 7 days without pay,” a member of the Brotherhood of Maintenance of Way Employees Division of the International Brotherhood of Teamsters previously told FOX Business.

He recalled a worker who was gone for 10 days because he had COVID-19 and was paid just $74 in that time. Many workers have to use vacation time to get paid for those absences, he said, and that is a sacrifice in the their career field.

“Most kids spend over 230 days away from their families a year, so our vacation is very important,” the worker said. “My grandfather died, and instead of being with my family, I had to work and use my holidays for his funeral. We hardly have time. Or there are kids who get sick with COVID because they don’t want to lose a salary”.

Jeffries noted that the railway companies are continuing to discuss ways forward with the four unions that have rejected the provisional deal.

“Our employees work 24/7/365 [days] and do an amazing job moving America’s cargo and doing it safely. These are tough jobs, and that’s why they’re so highly paid and absolutely deserve the compensation included in these deals,” Jeffries said. get the compensation they have earned and deserve for the hard work they do.”


Earlier this month, US Secretary of Labor Marty Walsh told FOX Business’ Edward Lawrence that he encouraged both sides to stay at the table and expressed hope that there won’t be a strike.

“I’ve encouraged both sides to stay at the table and give it another go and get another ratification vote out there, before the deadline expires,” Walsh said, adding that he was “very busy” with the ongoing talks he described formerly as “long” and “painful”.

Jeffries suggested that all sides take a step back and evaluate where the negotiations are at right now.

“We had 8 out of 12 unions, 9 out of 13 contracts fully ratified, which means those employees and those unions will get that immediate $16,000 pay raise and 24% over the terms of the contract, which will result in an average $160,000 in wages and benefits for our employees,” Jeffries explained.

“So we’re very happy to have come this far. We have work to do with our last four unions, and we continue to have those discussions and identify a path forward.”


Breck Dumas of FOX Business contributed to this report.

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