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Railway Labor Trouble: Union Votes on Proposed Deal Explained

Oct. 12, 2022, 6:10 PM

The threat of a nationwide rail strike popped up again when nearly 12,000 Teamsters this week rejected a contract proposal hashed out by the Biden administration last month to guarantee medical time off and a 24% wage hike.

Their refusal could spell bad news for the US supply chain, which transports about 40% of its long-haul cargo by rail. While the group’s decision to vote “no” doesn’t present immediate trouble for the economy, it doesn’t exactly bode well heading into the busy holiday season.

VIDEO: Union Busting: What Employers Can and Cannot Legally Do

1. Who rejected the deal?

The Brotherhood of Maintenance of Way Employes voted against a tentative agreement Oct. 10, with 6,600 voting no and 5,100 voting yes.

The BMWED doesn’t represent the bulk of rail workers—more than 100,000 in total are affected by the agreement—and it’s just one of a dozen unions involved. Nevertheless, continued opposition from a single union, including BMWED, could trigger a strike (more on that later).

Four unions have ratified the agreement so far, and seven will hold votes between now and Nov. 20, according to the National Railway Labor Conference, which represents the rail companies in collective bargaining.

The BMWED is the first union to reject the agreement brokered by the Biden administration, though it isn’t the first to express skepticism over dealings with the railroads. The International Association of Machinists District Lodge 19 will hold a second vote in the coming weeks after rejecting an earlier proposal last month.

2. Why are workers still mad?

Unions have been locked in a long-running feud with freight rail carriers over sick leave, pay, and a wide-ranging efficiency plan they say will reduce staffing to unsafe levels.

Scheduling has also been a big sticking point. Many rail workers are required to work 12-hour shifts and are on call. They say they have to ask for time off months in advance, making it difficult to take sick time or schedule doctor appointments. A lot of it has to do with employers’ “no fault” attendance policies, where workers are penalized under a points system for missing shifts until they’re eventually fired or punished. The new agreement requires workers to request the sick leave 30 days in advance.

3. Does this mean there will be a strike?

In the short term, no. The BMWED vote triggers a “status quo” period where the union can’t strike until Nov. 19, which happens to also be the eve of President Joe Biden’s 80th birthday.

But the long-term implications are harder to predict. While union leaders can ink tentative deals with management, reached through grueling rounds of negotiations, contracts can only be ratified by a popular vote of the workers. If a proposal is rejected, both parties must return to the bargaining table to negotiate a new deal, then bring it back to the workers for another vote.

Sometimes it takes multiple tries to get it right. For example, John Deere workers rejected two contracts last year before the company and the United Auto Workers reached a final agreement that got more than 50% approval.

It’s conceivable that one union holdout could trigger a nationwide rail shutdown. That’s because if one union were to go on strike, the others would likely refuse to cross the picket line, prompting a nationwide lockout from rail carriers. That’s exactly what happened in 1992 when the Machinists went on strike against CSX.

Rail is also a highly niched industry, meaning that the whole system could grind to a halt if one group of workers performing a specific duty walks off the job.

4. What does this mean for Biden and Marty Walsh?

The short answer: It’s not great for the Biden administration. The president wasted no time spiking the football in the Rose Garden on Sept. 15, calling the deal “a win for tens of thousands of workers,” bolstering his claim to being the most pro-union president in history. If Biden’s celebration was premature—especially if workers go on strike—it will be a painful rejection from his base that would be hard to explain away on the campaign trail.

Labor Secretary Marty Walsh, a union man himself, has been working to sell the tentative agreement to workers. In a speech Tuesday at the Brotherhood of Locomotive Engineers and Trainmen convention, Walsh said the proposal “sets a precedent” that can be built on in the future—a direct pitch to workers on the fence.

Read More

—With assistance from Rebecca Rainey

To contact the reporter on this story: Ian Kullgren in Washington at ikullgren@bloombergindustry.com

To contact the editors responsible for this story: Martha Mueller Neff at mmuellerneff@bloomberglaw.com; Genevieve Douglas at gdouglas@bloomberglaw.com