United States Inches Closer To Freight Rail Strike
Connecting the Dots has been following negotiations between freight railroads and freight railroad employees’ unions for several weeks. Last week, we reported some positive news: the two sides had agreed to give one another a few more weeks to reach an agreement before workers would strike.
The good will did not last long. On November 14, the International Brotherhood of Boilermakers (IBB) rejected the tentative agreement with the railroads, putting the United States on a path toward a national rail strike that could begin as early as December 5, depending on how the last two unions that need to ratify the agreement vote.
Seven unions have ratified the deal, but the Brotherhood of Railroad Signalmen (BRS) and the Brotherhood of Maintenance Way Employees Division (BMWED) have each voted against it. Even though the majority of the unions have approved the agreement, the 12 labor organizations involved in the talks have pledged to honor each other’s picket lines if there is a strike, which means ratification by all 12 unions is needed to avert a strike.
The IBB vote makes it increasingly likely that congressional intervention will be necessary to avert a pre-holiday season strike.
As CNN reported, “Railroad unions face limits on when they can strike” and federal lawmakers have the tools to prevent or limit any strike through legislation. U.S. Department of Labor Secretary Marty Walsh has been a key leader in the effort to avoid a strike. While the unions have thus far advocated against congressional intervention, Secretary Walsh told CNN that step might be necessary.
The stakes are high in this matter. According to an analysis by the American Chemistry Council, a potential one-month rail strike could cost the U.S. economy $160 billion and would cause the closure of chemical manufacturing sites within a week of the start of a strike.
MSCI is closely monitoring this situation and is working with organizations like the U.S. Chamber of Commerce and the National Association of Manufacturers to determine whether to ask for congressional intervention.