Home Agreement Halts “Catastrophic” U.S. Rail Strike
September 15, 2022

Agreement Halts “Catastrophic” U.S. Rail Strike

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Things looked grim on the transportation front when Amtrak announced on September 14 that it had suspended long-distance passenger service for September 15 and the National Retail Federation issued a warning about the crippling impact of a nationwide rail strike affecting freight shipments, but the threat has faded.

Early on September 15, the first date when unions might call a strike, the United States Department of Labor announced that, following 20 consecutive hours of negotiations, it, rail companies and unions representing freight workers had come to a tentative agreement “that balances the needs of workers, businesses and our nation’s economy. Secretary Walsh and the Biden Administration applaud all parties for reaching this hard-fought, mutually beneficial deal. Our rail system is integral to our supply chain, and a disruption would have had catastrophic impacts on industries, travelers and families across the country.” 

Martin Walsh is the Department of Labor secretary.

NRF president and CEO Matthew Shay issued a statement on the tentative agreement, in which he said,

We are relieved and cautiously optimistic that this devastating nationwide rail strike has been averted. We appreciate the Biden administration’s intervention on behalf of the businesses and consumers who would have been impacted at a time when high inflation and economic uncertainty are challenging consumer budgets and putting business resiliency at risk. We hope railway workers will accept the new terms of the proposed contract and the railway system can continue to operate on behalf of the millions of hardworking Americans who rely on it for their jobs and the economic security of our country.

The White House announced also early on September 15 that the tentative agreement reached is an “important win for our economy and the American people.”

The White House went on to maintain, “It is a win for tens of thousands of rail workers who worked tirelessly through the pandemic to ensure that America’s families and communities got deliveries of what have kept us going during these difficult years. These rail workers will get better pay, improved working conditions, and peace of mind around their health care costs, all hard-earned. The agreement is also a victory for railway companies who will be able to retain and recruit more workers for an industry that will continue to be part of the backbone of the American economy for decades to come.”

The day before, the threat of a strike loomed and Shay had cautioned:

Freight rail is critical to the retail supply chain, and retailers of every size rely on it to move cargo every day. Retailers are deeply concerned about the situation and the impact that a disruption would have on business operations throughout the country. The timing coincides directly with peak shipping season for the winter holidays, and a rail strike at this juncture would be just one more significant, inflationary shock to an economy that is already reeling from historically high inflation. Smooth and stable operations on the rails is crucial as we enter the busy holiday season. Should the negotiating parties fail to reach an agreement, Congress must act quickly to intervene and implement the Presidential Emergency Board’s recommendations to avoid a rail strike and a catastrophic shutdown of the freight rail system.

NRF cited a report from the American Association of Railroads contending that a nationwide rail shutdown could halt almost 7,000 freight trains and cost more than $2 billion a day. NRF already had sent a letter to Congress expressing concern about the potential for U.S. freight rail disruptions. 

In a press statement issued on September 14, Amtrak declared that, for Thursday, September  15, all Amtrak Long Distance trains and some state-supported routes outside the Northeast Corridor had been canceled, and that it would wait to see about negotiation results before deciding on September 16 and beyond.

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