In other union news: impending rail workers strike would cost the economy $2 billion per day....

The Tradition

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On the heels of the latest round of labor negotiations between the National Mediation Board, unions, and freight railroads, the Association of American Railroads has released a report projecting that the economic impact of a nationwide railroad strike could be more than $2 billion a day.

So far, five of the 12 unions, representing 21,000 employees, have reached voluntary agreements with the railroads. The expiration of the 30-day cooling-off period when unions can walk off the job is midnight on September 16. There are just under 115,000 Class I railroad employees in the U.S., according to August data.

If a strike happens, the report from the AAR’s policy and economics team — which uses historical data from the Federal Railroad Administration — states that the 140,000-mile network of rails across 49 states and 7,000 Class I trains would be idled, and the impact would cripple both the movement of trade and commuters.

There are not enough trucks or truck drivers to move the rail bound containers, according to the report, with an additional 467,000 long-haul trucks per day needed to handle the freight.

Logistics CEOs tell CNBC the impact of a nationwide rail strike would impact the economy far more than a port strike on the West Coast.

“Depending on the length of any service interruption, the overall impact would double each day the interruption continued,” said Alan Baer, CEO of OL-USA. “As we experienced with the ports, delays mounted quickly and it is now taking weeks to unwind. Domestic trucking rates would surge as capacity disappears. Overall a nightmare scenario.”

Wage increases the railroads are offering

The details of the deal were recommended by the Presidential Advisory Board appointed by President Joe Biden in July to avert a strike. They are non-binding, but if implemented, would see employees receive a 14.1% wage increase effective immediately, and a 24% compounded wage increase during the five-year period from 2020 through 2024. Service recognition bonuses would also be given to employees over the duration of the contract and would total $5,000. Combining the lump sum payments and the retroactive wage increases, employees would receive an average immediate payout totaling more than $11,000.

The average pay of a rail employee if the deal is ratified would be approximately $110,000 per year by the end of the agreement. Combined with benefits like retirement, and health care, employees would earn $160,000 a year. If agreed upon, industry insiders tell CNBC the general wage increases will be the most substantial in at least 40 years of rail labor negotiations. According to the industry report, the average U.S. Class I freight rail employee earned wages of $95,700 and fringe benefits of $40,000 in 2020, for total compensation of $135,700.

Terms of the deal have to be agreed upon between the unions and railroads.

The National Carriers’ Conference Committee, which represents freight railroads, declined to comment to CNBC, citing the sensitivity of active negotiations. A spokesperson for the Transportation Trades Department of the AFL-CIO — a federation of 37 leading transportation worker unions in the U.S. — also cited the ongoing negotiations in declining to comment.

Some holdout unions have recently issued strong statements about their position. The leaders of the BLET and Smart-TD unions said in a Labor Day statement that they had been “carved out” from the rest of rail labor as “we were the only Unions that the Carriers insisted upon work rule changes from throughout the PEB hearing.”

“It has become clear in our post Presidential Emergency Board (“PEB”) negotiations with the Rail Carriers that they are counting on the Federal Government to come to their aid if we are unable to reach a Tentative Agreement, and so far, we have not reached an Agreement,” BLET President Dennis Pierce and SMART-TD President Jeremy Ferguson stated. ”The same rail carriers that complain about government intervention when the Federal Railroad Administration proposes a rulemaking on crew size, and also shudder at the thought of the Surface Transportation Board issuing regulations that would help shippers, now all but hide behind Congress, refusing so far to negotiate terms our members would accept and ratify.”

In a statement, AAR President and CEO Ian Jefferies said, “As the freight sector heads into peak shipping season, a nationwide rail work stoppage would result in an unnecessary $2 billion daily economic hit. President Biden’s PEB recommended terms that would maintain the highest quality health care coverage and result in compounded wage increases of 24%, bonuses totaling $5,000 — the highest pay increases in nearly 50 years.”

“Like those unions that have already tentatively agreed to the PEB deal, each of the remaining unions can still enter into agreements based on these recommendations. However, should negotiations fail and result in a work stoppage, Congress must act to implement the PEB recommendations — rewarding employees and stopping unnecessary economic harm and uncertainty for rail customers.”

Industries call on Congress to intervene

Several major industries including the Fertilizer Institute and Retail Industry Leaders Association have sent letters to Congress urging intervention.

“Over half of all fertilizer moves by rail year-round throughout the United States and the timeliness and reliability of fertilizer shipments is absolutely critical,” TFI said in its letter. “If farmers do not receive fertilizer, it results in lower crop yields, higher food prices, and more inflation for consumers.”

RILA members, which account for more than $1.5 trillion in annual retail sales, wrote, “Failure to reach a reasonable agreement could result in significant disruptions to the rail network, the retail industry, and ultimately the American consumer.”

According to the AAR report, the industries heavily relying on rail to move their products include e-commerce, agriculture, chemical, automotive, construction, and coal.

“UPS, for example, may be the single largest rail customer,” the report stated. “A single intermodal container or trailer railroads carry for UPS could contain 1,800 to 2,000 packages. A train with 100 containers or trailers could have 200,000 UPS packages headed for our doorsteps.”

The report noted the U.S. supply chain would also be disrupted by raw materials delays, such as lumber from Canada used for home building and construction, to autos and auto parts.

Commuters, Amtrak impact

Amtrak would also be significantly impacted, according to the AAR report, because the passenger railroad service owns a very small fraction of its rail system, with the remaining 97% running on tracks owned and maintained by freight railroads. In addition to the rails itself, the freight railroads also offer services to Amtrak ranging from station maintenance, train dispatching, and emergency repairs to security.

Both the union and railroad negotiators will meet again with the National Mediation Board on Thursday and Friday. The negotiations between the 12 railroad worker unions and the National Carriers’ Conference Committee have been going on for years.

 
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abby97

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Hope they come to an agreement but glad that the employees are able to negotiate via collective bargaining which imposes some pain upon the rail road companies for failing to come to an agreement.
Ya, I'm sure it's all the railroads fault.:rolleyes:
 

Hoosierhawkeye

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According to the industry report, the average U.S. Class I freight rail employee earned wages of $95,700 and fringe benefits of $40,000 in 2020, for total compensation of $135,700.

You don't think they're paid fairly already???

They are paid well but the collective bargaining allows the market to decide what they are paid instead of them taking whatever the rail road companies offer because they have to feed their families.

I thought you would like the market deciding what people are paid.
 

MepoDawg#

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They are paid well but the collective bargaining allows the market to decide what they are paid instead of them taking whatever the rail road companies offer because they have to feed their families.

I thought you would like the market deciding what people are paid.
Well they can also go find different jobs if they don’t feel they’re paid well enough instead is hurting the economy more and increasing prices which cuts into any additional money they get. They’re in the top 40% of household income as a single earner and making nearly twice the poverty level of a family of 4 just with wages, not counting other benefits.
 

The Tradition

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They are paid well but the collective bargaining allows the market to decide what they are paid instead of them taking whatever the rail road companies offer because they have to feed their families.

I thought you would like the market deciding what people are paid.

A union is "the market" at work???

Are you freaking serious with this shit????
 
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ihawk in FWB

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Well they can also go find different jobs if they don’t feel they’re paid well enough instead is hurting the economy more and increasing prices which cuts into any additional money they get. They’re in the top 40% of household income as a single earner and making nearly twice the poverty level of a family of 4 just with wages, not counting other benefits.
Gokd for them. It sounds like they'll be getting more.
 

Hoosierhawkeye

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A union is "the market" at work???

Are you freaking serious with this shit????

Absolutely . . . it's employee's getting together to collectively bargain for wages and in so doing evens up the negotiating leverage by inflicting similar pain as they will experience for failing to come to an agreement.

A single employee can't do this. For the business failing to come to an agreement with a single employee simply means having other employees cover for him until you can find another. For the employee it means financial hardship to the extent that they might not even be able to feed their family.

With collective bargaining there is similar pain on the business.
 

Huey Grey

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Jan 15, 2013
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I take the side of whom I believe is in the right but when there is a union involved, I always take the other side.
So you believe workers should have no right to negotiate wages. And this isn't a case of right or wrong. It is a case of market demand. Railroad workers have what looks to be an irreplaceable skill set, realize this, and are demanding compensation equivalent to this skillset.
 

MepoDawg#

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The President can order the railroad workers back to work it's been done before by a Democrat President
No, he can’t since he’s already done that two months ago. Congress can, but will they. Congress can impose a new deal or kick the can down the road by extending the cooling off period that Biden already put in place.

The Presidential Emergency Board (PEB) recommended annual raises back in July 2020. It would give them a 14% raise including being retroactive to 2020 as well as another 10% over the contract resulting in 24% increase over 5 years. This recommendation was somewhere between what the union proposed and what management proposed.
 

The Tradition

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So you believe workers should have no right to negotiate wages. And this isn't a case of right or wrong. It is a case of market demand. Railroad workers have what looks to be an irreplaceable skill set, realize this, and are demanding compensation equivalent to this skillset.

As an individual worker applying at a union shop, you have ZERO ability to negotiate wages. They have to pay you whatever the union scale is.

Only slackers who have no individual worth would want to be involved in "collective" bargaining.
 

The Tradition

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Isn't wage negotiation a part of capitalism?

Radical Right should love that. And a person's wage is relative to where they live.

What's the problem again?

I don't want to be a part of a "collective"... I want to be able to negotiate the terms and conditions of my employment based on the value I bring to the organization. Not what the union bargained for my job.
 

The Tradition

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Apr 23, 2002
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Absolutely . . . it's employee's getting together to collectively bargain for wages and in so doing evens up the negotiating leverage by inflicting similar pain as they will experience for failing to come to an agreement.

A single employee can't do this. For the business failing to come to an agreement with a single employee simply means having other employees cover for him until you can find another. For the employee it means financial hardship to the extent that they might not even be able to feed their family.

With collective bargaining there is similar pain on the business.

There's plenty of pain on business already. Remember the labor shortage?

Unions are a bunch of thugs.
 

abby97

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So you believe workers should have no right to negotiate wages. And this isn't a case of right or wrong. It is a case of market demand. Railroad workers have what looks to be an irreplaceable skill set, realize this, and are demanding compensation equivalent to this skillset.
I never said I didn't think workers shouldn't have the right to negotiate, I said I don't believe in unions. Everyone who believes in their own worth and wants to be compensated for their rightful value, should negotiate.
 

SigMaintHawk

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According to the industry report, the average U.S. Class I freight rail employee earned wages of $95,700 and fringe benefits of $40,000 in 2020, for total compensation of $135,700.

You don't think they're paid fairly already???
Ever worked for a railroad?...Just passed the 20 year mark a month ago...If you haven't had the pleasure...trust me....you earn every God damn penny..
 

Hoosierhawkeye

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Rs aren't against workers. Rs love the working man.

What Rs are against is socialist crapola like unions.

And you are therefore against workers since you know unions have been very successful at increasing worker pay.

There's plenty of pain on business already. Remember the labor shortage?

Unions are a bunch of thugs.

The labor shortage that just now happened after how many decades of businesses exploiting labor?

If labor extracted the collective pain on businesses that labor has had to endure for the past 4 to 5 decades it would be crazy.
 
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RNHawk

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So you believe workers should have no right to negotiate wages. And this isn't a case of right or wrong. It is a case of market demand. Railroad workers have what looks to be an irreplaceable skill set, realize this, and are demanding compensation equivalent to this skillset.
Now do nurses
 

ping72

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Jan 14, 2009
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According to the industry report, the average U.S. Class I freight rail employee earned wages of $95,700 and fringe benefits of $40,000 in 2020, for total compensation of $135,700.

You don't think they're paid fairly already???

Isn’t part of the problem that they’re all working like 100 hours a week? If so… I would say they’re not compensated fairly.
 

MitchLL

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Dec 26, 2018
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The "pain" will be transferred to you and me in the form of higher shipping costs for everything.
You're worried about "pain"?

Wages paid to employees has, and will always be, a cost of doing business for any entity. Those costs get passed to customers just like they always have been.

What, exactly, is your argument/concern? And if you're concerned about the projected yearly benefits package to these workers... why?

These workers pay taxes that fund State, County, and City services.

You're fear mongering just like the national political Party you support.

Capitalism, baby!

BTW: I hear it's hurricane season. Shouldn't you be hoarding bottled water and cigs?
 

theiacowtipper

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According to the industry report, the average U.S. Class I freight rail employee earned wages of $95,700 and fringe benefits of $40,000 in 2020, for total compensation of $135,700.

You don't think they're paid fairly already???
Averages in something like this is stupid generally. What’s the median? Who is included in the group?