Presidential Commission Recommends Concessions for Railroad Workers

Mike Elk

Despite the four largest railroad companies making $8.5 billion in profits last year, an association of 30 railroads is asking 92,000 railroad workers represented by 11 unions to make concessions that could result in the first railroad strike in nearly 20 years.

Last month, Obama stepped in to prevent the strike of tens of thousands of railroad workers under powers granted to the president under the Railway Labor Act (which governs labor relations in the railway and airline industry) after the 59,000-member Brotherhood of Locomotive Engineers and Trainmen (BLET) voted to go on strike. It was the first time a president stepped in to avoid a private-sector strike since President George W. Bush prevented a strike at Amtrak in 2007.

Obama formed a Presidential Emergency Board comprised of five members to issue recommendations on what type of contract the two sides should agree to. Yesterday, the Board offered its recommendations, and they were slightly better (from workers’ perspective) than a concessionary contract agreed to by one of the unions, United Transportation Union. But they still endorse concessions, including shifting healthcare costs to workers, which unions say are unacceptable.

The Board called for a wage increase greater than what was previously agreed to in the UTU contract. It also recommended a lump-sum signing bonus for all employees covered by the agreement, while the UTU agreement only called for a lump sum signing bonus for a few employees. However, the presidential board did recommend that the union accept the company’s call for workers to pay an average $200 more a month out of pocket for healthcare than they were previously paying, but called for the new health care agreement to be implemented over an 18-month period rather than to be implemented immediately, as the company wants.

Union officials are upset.

The 11 unions working in unison made a compelling case for status quo on health and welfare benefits and an even more compelling argument for wage increases greater than those found in the recommendation,” said BLET President Dennis Pierce. BLET also made very strong arguments for long overdue changes to its craft specific agreements that were documented by substantial evidence, and made it quite clear to the Board that our wage settlements with three of the four largest Class I carriers and on-property negotiations with the fourth meant that health care cost-shifting would place a tremendous obstacle in the way of obtaining an acceptable settlement. Unfortunately, that is exactly the situation we now face.”

Now, as mandated under federal law, the union and the railroad employer association will return to the bargaining table to negotiate for 30 days before either side will be allowed self-help” remedies. After that 30-day period, the railroad workers unions would be allowed to strike and the company could choose to lock workers out if the contract dispute continues.

Additionally, the Railway Labor Act gives Congress the power to step in and impose a contract on the workers unilaterally. The last time railroad workers went on strike, in 1991, the strike lasted 14 hours before Congress passed a bill and the president created a board to unilaterally impose a concessionary contract on railroad workers.

The sight of Congress stepping in to impose massive concessions on railroad workers at profitable companies could have a chilling effect on mobilizing support for Obama’s re-election from a progressive movement mobilized by the Occupy Wall Street movement.

As Jonathan Flanders, an IAM union member and railroad machinist in a CSX locomotive shop in New York, told me last month, referring to the prospect of Obama imposing a concessionary contract on railroad workers: It would be more evidence of who Obama serves. If banks disrupt commerce, they get a bailout. If workers disrupt commerce, it’s another story. We get forced to work under a contract we wouldn’t agree to otherwise.”

Mike Elk wrote for In These Times and its labor blog, Working In These Times, from 2010 to 2014. He is currently a labor reporter at Politico.
Brandon Johnson
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