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

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.


 
Well, the latest I’ve heard is that the engineers and conductors aren’t even close to coming to an agreement with the BN or the UP. The signal guys apparently aren’t either. I was pleased to see my own union finally agree to terms and prepare to bring in a new contract, but it’s looking pretty likely that all of us will be on strike Friday morning.
 
The BN union thinks a strike would last 2-7 days. Sounds like it’s pretty much happening. The guys will get back pay from their last raises, but again, this is way more than wages.
 
Forcing workers to accept things in service to the national economic interest sounds almost communist to me…are you sure some of you MAGA people have your beliefs right?

Go workers, stick it to the man! If it crashes the economy, so be it…then that’s pretty sad that our economy is completely built on the backs of underpaid labor…
 
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Forcing workers to accept things in service to the national economic interest sounds almost communist to me…are you sure some of you MAGA people have your beliefs right?

Go workers, stick it to the man! If it crashes the economy, so be it…then that’s pretty sad that our economy is completely built on the backs of underpaid labor…


Hopefully UPS will pay their employees a rate close to what they increase CEO pay, or employees at the top of their earning chain.

When CEO and upper mgmt compensation (including stocks) have increased >200x-300x what regular earners make AND regular wages have tracked slower than overall inflation, we definitely have a need to rebalance.

If the opposite were true, then it'd make sense for government to limit the ability to strike. Companies absolutely have the ability to increase lower-end wages and lower exec pay, without increasing prices. But corporate and exec greed, and an "entitlement" mentality prevents them from doing so.
 
Here's how a real president deals with this:

Reagan's second biggest mistake as POTUS!
#1 was his embracing the rightwing Evangelicals into the GOP.
(Altho, I am sure that Reagan's "firing" of the air-controllers gave many managers a hard-on that they carried with them for days! )
 
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.
Yes my uncle worked 42 years for the railroad and 50 hours a week was the bare minimum he worked. A few years before he retired I remember talking to him he had gone something like 4 months straight with at least 40 hours overtime per paycheck.
 
Amtrak is suspending operations beginning tomorrow everywhere except for the northeast corridor.
 
Here's how a real president deals with this:

Yeah, that worked out real well. The airline industry was one of the most heavily regulated industries for the next decade due to a lack of sufficient staffing at many critical ATC facilities. Those that stayed on the job got the reward of working 60 hours a week for years and they still couldn't push the same traffic levels prior to the walkout.
 
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.
Collective bargaining allows them to monopolize labor for the railroad. This monopoly is specifically to prevent market pricing of labor.
You have this as backwards as possible.
 
Republicans in Congress are drafting legislation that will force the union to accept the deal.

Democrats hope it won't come to that, but have signaled they'll go along with it if they have to do so.

Game over, union. Shut up and go to work.
 
Republicans in Congress are drafting legislation that will force the union to accept the deal.

Democrats hope it won't come to that, but have signaled they'll go along with it if they have to do so.

Game over, union. Shut up and go to work.
Sen. Bernie Sanders (I-VT) blocked a Republican effort to require railroad employees and companies to accept recommendations of a nonpartisan panel in order to avoid a strike which, if it goes through, will impact millions of Americans.

The GOP resolution - introduced by Senate Health, Education, Labor and Pension Commission Ranking Member Richard Burr (R-NC) and Sen. Roger Wicker (R-MI), would have required railroad workers to adopt the outlines of a labor deal, The Hill reports.

The GOP plan would adopt resolutions from President Biden's Presidential Emergency Board, which recommended a 24% wage increase, retroactive to 2020, as well as annual bonuses of $1,000 and additional paid leave.

"This is the president’s bipartisan emergency board that he set up that came back with a recommendation to the Biden Administration and said here is the solution to this. It should be adopted,
" said Burr.
 
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.

Thanks Brandon
 
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Republicans in Congress are drafting legislation that will force the union to accept the deal.

Democrats hope it won't come to that, but have signaled they'll go along with it if they have to do so.

Game over, union. Shut up and go to work.
Railroads are already having trouble hiring people. These same class I railroads are offering $20k sign on bonuses but still aren’t filling new hire classes. People are quitting left and right because of archaic attendance policies. How much of an impact with even more people quitting have on the economy than striking for a couple days?
 
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Republicans in Congress are drafting legislation that will force the union to accept the deal.

Democrats hopeeeon't come to that, but have signaled they'll go along with it if they have to do so.

Game over, union. Shut up and go to work.
O...K.. I see a slow down coming.
 
Railroads are already having trouble hiring people. These same class I railroads are offering $20k sign on bonuses but still aren’t filling new hire classes. People are quitting left and right because of archaic attendance policies. How much of an impact with even more people quitting have on the economy than striking for a couple days?

One thing often overlooked about Nazi Germany.... the trains ran on time.
 
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I’m currently on a conference call with my union officials. Things are not good, folks. The transportation and signal guys and their unions have a little over a day to figure things out with their companies. It’s a screaming match right now.
 
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What major supply chain disruptions are we going to be facing due to this? Will food and/or toilet paper be affected?
 
Well, the latest I’ve heard is that the engineers and conductors aren’t even close to coming to an agreement with the BN or the UP. The signal guys apparently aren’t either. I was pleased to see my own union finally agree to terms and prepare to bring in a new contract, but it’s looking pretty likely that all of us will be on strike Friday morning.
I heard 10 of the 12 majors have now agreed. Amtrack folks and one other are still holding out.

Spoke to my son, he says the contract does nothing to address the time issue. @WhiskeyDick, what are your thoughts on this.

He is currently "On call" most of the time. He feels abused because he can go home after a shift, sleep, get up thinking you may have to go to work, never get a call, until 30 minutes or left in your on call shift and he then has to go put in 12 hours, drive home 2 hours, and by that time, could legitimately be up for a continuous 24 hr period. How is that not a safety factor? He says his dispatch group burns crews like that too.
 
I heard 10 of the 12 majors have now agreed. Amtrack folks and one other are still holding out.

Spoke to my son, he says the contract does nothing to address the time issue. @WhiskeyDick, what are your thoughts on this.

He is currently "On call" most of the time. He feels abused because he can go home after a shift, sleep, get up thinking you may have to go to work, never get a call, until 30 minutes or left in your on call shift and he then has to go put in 12 hours, drive home 2 hours, and by that time, could legitimately be up for a continuous 24 hr period. How is that not a safety factor? He says his dispatch group burns crews like that too.
I was one of the controllers Reagan fired back in '81.

We had a bad work schedule as well. Each day we would go in earlier than the day before, starting with a 4-midnight on day one and ending up going in at midnight on day 4 and working till 8am on day 5. We would work a 40 hour schedule but it would often work out we would work those 40 hours over an 88 hour time frame. Alcohol was often used on the short turn arounds, especially if you were coming off a rough shift.
 
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I was one of the controllers Reagan fired back in '81.

We had a bad work schedule as well. Each day we would go in earlier than the day before, starting with a 4-midnight on day one and ending up going in at midnight on day 4 and working till 8am on day 5. We would work a 40 hour schedule but it would often work out we would work those 40 hours over an 88 hour time frame. Alcohol was often used on the short turn arounds, especially if you were coming off a rough shift.
How the hell do you have a rough shift as a controller? Have an engineer run over a family in a mini van, or someone commit suicide by train or maybe a kid lose an arm or a leg playing chicken. Worse yet, a conductor gets crushed while switching or pushing/pulling cars.....that I can see. Telling an engineer what he needs to do?

I can see why you might drink.
 
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How the hell do you have a rough shift as a controller? Have an engineer run over a family in a mini van, or someone commit suicide by train or maybe a kid lose an arm or a leg playing chicken. Worse yet, a conductor gets crushed while switching or pushing/pulling cars.....that I can see. Telling an engineer what he needs to do?

I can see why you might drink.

How do you have a rough shift as an air traffic controller? Do you have any idea what they do? Keep this straight:

 
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