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Clock Ticks on Rail Contract Talks 

Rail labor leaders and employers were unable to reach an agreement in last week’s meetings to address recommendations made by the Presidential Emergency Board (PEB) to resolve a more than two-year contract dispute involving 115,000 workers. 

The dozen unions and the National Carriers’ Conference Committee (NCCC), which is negotiating on behalf of the country’s major railroads, began discussions last Monday on the findings of the 119-page PEB report. The document aimed to address all areas of dispute between the two sides and offer suggestions for resolution. 

Initial meetings began virtually before the two parties met in person on Thursday and Friday in Chicago about the PEB recommendations. 

“Unfortunately, the meetings did not result in any tentative agreement language that operating crafts would accept, or that could be presented to our members for ratification,” Dennis Pierce, Brotherhood of Locomotive Engineers and Trainmen (BLET) president, and Jeremy Ferguson, SMART Transportation Division (SMART-TD) president,  said in a joint update statement Saturday afternoon. 

The two went on to point to wages, quality of life, attendance programs and time off as negotiating areas deemed “most important to our members.” 

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“We have made it abundantly clear to the carriers that we are prepared and willing to exercise every legal option available to us, to achieve the compensation and working conditions that we and our families rightfully expect and deserve,” the BLET and SMART-TD statement went on to say. 

Despite there still being no agreement, the two organizations said they will continue negotiations.

The PEB’s report suggested a wide gap separating employers and unions, with the duo managing to agree on two aspects: the contract covers a five-year length of time and the basic percentage wage increase would apply to all rail trades. 

In dollars, the gap between contract proposals from labor and employers is more than $9 billion, according to the PEB. 

“The parties take opposing positions on almost everything else relevant to the resolution of the wage dispute, as reflected by the wide divergence of proposals, both in percentage and absolute dollar terms,” the PEB said in its report. 

At the top of what’s been proposed by the PEB is a 24 percent compounded increase to wages over the term of the contract, plus a total of $5,000 in bonuses. 

The recommendation meets the parties in the middle, with carriers originally proposing a 17 percent compounded increase and unions asking for 31.3 percent. 

The NCCC, immediately following the PEB’s recommendations, said railroads were ready to reach an agreement with the unions using the board’s report as a foundation for further discussions. 

“Although the recommended wage terms significantly exceed those proposed by the carriers in this round and are far above those contained in prior rail labor settlements, it is in the best interests of all stakeholders—including customers, employers and the public—for the railroads and rail labor organizations to settle this dispute and prevent service disruptions,” it said. 

Some union leaders’ expressed their dismay at the board’s conclusions. 

“Truthfully, your union negotiators feel a level of disappointment with the PEB’s recommendations falling short on many of our requests—especially as it split the difference between what labor and the carriers were seeking from a wage perspective, rather than choosing one over the other,” SMART-TD’s Ferguson said in a message to members following release of the report. 

“While the wage adjustments are the highest in modern history, they still fall short of what our members have earned through their hard work in keeping America moving, despite the numerous obstacles,” the Brotherhood of Railroad Signalmen (BRS) said in a statement in response to the report. 

Workers have been laboring without a contract for more than two years, with the dispute being sent to the National Mediation Board earlier in the summer. They entered a 30-day cooling off period in June after failing to reach an agreement, raising the possibility of a strike that had the potential to shut down the country’s railways. That was averted when President Biden established the PEB to investigate the dispute and help the two parties reach an agreement.

The PEB’s report was released Aug. 16, triggering another 30-day cooling off period. A strike or lockout could then occur after that period ends on Sept. 16, though Congress has the authority to step in to resolve the dispute. 

Retailers and other industry sectors are watching the talks closely, given any strike or lockout measure would further disrupt the country’s supply chain

Rail, in particular, has been a pain point in the movement of goods with a labor and equipment shortage that’s led to a glut of containers waiting to be loaded onto trains. 

The Port of Los Angeles reported Friday on-dock rail containers waiting to be loaded totaled 31,757, with 20,695 of those containers dwelling on the terminals for nine days or more.