Skip to main content

AAFA CEO to Lawmakers: Rail Negotiations Have Reached ‘Critical Stage’

The trade association for U.S. apparel and footwear companies told lawmakers rail negotiations have reached a “critical stage” that calls for Congressional action. 

American Apparel & Footwear Association (AAFA) president and CEO Steve Lamar called on Congress in a letter Tuesday to help resolve the more than two-year contract talks between the nation’s Class 1 railroads and remaining unions to avert a strike. 

“With 98 percent of all apparel, footwear and travel goods sold in the U.S. today being imported, our industry’s 3 million American workers depend on a smooth supply chain,” Lamar said in the letter. “Rail, particularly intermodal, is an increasingly important piece of the puzzle as we work to bring the right clothes, shoes and accessories to American families at the right time, and at the right price.” 

A strike, which could come as early as Friday, would hit as businesses dig themselves out of the supply chain crisis of the past two years and growing inflation, Lamar pointed out. 

Nate Herman, AAFA senior vice president of policy, told Sourcing Journal 25 percent of apparel and footwear is moved on rail and would be stuck on the lines during retail’s peak season if workers were to strike. 

Related Stories

“At the same time, trucking demand would skyrocket,” Herman said. “With every industry rushing for trucks, amid notable truck driver and chassis shortages—not to mention the ongoing West Coast port labor talks and still-record inflation rates shared this week—our industry will feel it, consumers will feel it and the economy will feel it.” 

The Association of American Railroads said last week disruption to the lines would amount to losses of at least $2 billion a day

Railroads have already begun restricting shipments of hazardous goods and time-sensitive items in preparation for a shutdown. 

White House press secretary Karine Jean-Pierre told reporters Tuesday the unions and carriers are being pushed to reach a resolution, but the administration is also working on a contingency plan in the event of a strike. 

“We are working with other modes of transportation, including shippers and truckers, air freight to see how they can step in and keep goods moving in case of this rail shutdown,” Jean-Pierre said. “The administration has also been working with relevant agencies to assess what supply chains and commodities are most likely to face severe disruptions and available authorities to keep goods moving.” 

The American Trucking Associations (ATA) said last Friday truckers would be unable to offset the impacts of a rail strike, given the labor and equipment shortages that trucking has faced for some time. 

ATA president and CEO Chris Spear said in a letter to Congress any disruption “will create havoc in the supply chain and fuel inflationary pressures across the board.” 

Nine of the 12 unions involved in negotiations are publicly confirmed as having tentative agreements with the railroads. The Brotherhood of Locomotive Engineers and Trainmen (BLET) and SMART Transportation Division (SMART-TD), representing roughly 90,000 workers, have been called out as the two holdout groups that have rejected contract recommendations made by the Presidential Emergency Board (PEB). The board was established by President Biden in July to help employers and workers reach a resolution after talks failed in mediation.

The PEB released its recommendations last month, with some of the unions in more recent days striking tentative agreements with carriers based on that report. 

Working conditions, and attendance policies more specifically, represent the sticking point between the two unions and the railroads. 

BNSF’s High Visibility (Hi Viz) policy, which created a points-based system for taking time off, and implementation of the precision scheduled railroading (PSR) model across railroads were called out by the unions to the PEB as having created dangerous work environments that force workers to come to work sick rather than risk losing their jobs. 

The PEB recommended SMART-TD and BLET drop their attendance policies proposals citing lack of reason to justify what it said would “limit the carriers’ managerial prerogatives and restrict attendance policies.” 

“Sadly, the Presidential Emergency Board recommendation got it wrong on this issue,” BLET president Dennis Pierce and SMART-TD president Jeremy Ferguson said Sunday in a joint statement. “As we have said from the day that they were implemented, these policies are destroying the lives of our members, who are the backbone of the railroad industry.”