Major rail union rejects deal: What’s next?
The threat of a nationwide strike still looms but not until after the midterm elections
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President Biden declared victory last month when rail unions and major railroad companies reached a tentative agreement to avoid a nationwide strike.
However, new developments indicate a stoppage could still occur after November's midterm elections.
Workers represented by one of the nation's largest rail unions rejected a tentative deal with the nation's major freight railroads Monday, delivering a setback to negotiations for a new contract that have been years in the making and renewing the prospect of a strike that could hamstring the U.S. economy.
CSX Transportation Inc. freight trains sit parked in a railroad yard in Louisville, Ky., Sept. 14, 2022. (Luke Sharrett for The Washington Post via Getty Images / Getty Images)
The Brotherhood of Maintenance of Way Employees Division of the International Brotherhood of Teamsters (BMWED) said now that the majority of its members voted against ratifying the agreement, the parties will head back to the bargaining table during a "status quo" period that will extend until five days after Congress reconvenes next month. Lawmakers are expected to return Nov. 14.
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Marc Scribner, a senior transportation policy analyst at the Reason Foundation, told FOX Business that means there is still plenty of time for both sides to work out an agreement. Scribner called BMWED's rejection of the deal "definitely troubling" but said the move does not guarantee any work stoppage like a strike or lockout.
A worker rides a rail car at a BNSF rail crossing in Saginaw, Texas, Sept. 14, 2022. (AP Photo/LM Otero / AP Newsroom)
| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| UNP | UNION PACIFIC CORP. | 229.91 | -2.78 | -1.19% |
| CSX | CSX CORP. | 33.36 | -0.03 | -0.09% |
| NSC | NORFOLK SOUTHERN CORP. | 247.59 | -2.50 | -1.00% |
The National Railway Labor Conference (NRLC) representing the nation's freight railroads in the negotiations said following BMWED's rejection that, as of Monday, four of the twelve unions involved have ratified agreements, while seven others "remain subject to ratification."
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With a majority of unions involved still yet to hold votes on ratification, Scribner says it is too early to tell what might happen next, and observers should "wait and see for some of the other votes to come in."
A worker walks along tracks at a BNSF rail yard Sept. 14, 2022, in Kansas City. The third-largest railroad union rejected its deal with freight railroads Monday, Oct. 10, 2022, renewing the possibility of a strike that could cripple the economy. (AP Photo/Charlie Riedel, File / AP Newsroom)
Two more rail unions are expected to hold ratification votes this week. If more unions reject the tentative agreement, it will increase the possibility that the railroads might have to make further concessions to avoid a work stoppage, but there are no signs of that happening yet.
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Scribner says both sides want to avoid a lame-duck Congress getting involved if a work stoppage does occur in late November because lawmakers will be less open to compromise on their positions, which "is not ideal for the workers or the railroads."
"In the coming weeks, alarm bells might start going off," Scribner says. "But not yet."