President Joe Biden’s statement early Thursday that freight rail companies and workers had reached a tentative labor agreement would avert a potentially disruptive strike that could have begun on Friday.
The tentative agreement came as warnings about the economic cost of a work stoppage were growing louder in recent days and only a few hours after Senate Republicans sought to pass a joint resolution that would require workers and rail companies to accept recommendations made by a presidential emergency board in mid-August. Sen. Bernie Sanders, I-Vt., blocked the effort.
The administration didn’t release many details of the pact, and workers have yet to vote on it. But Amtrak was reportedly working to restore service on canceled lines, a sign of confidence in the agreement. In much of the country, Amtrak’s passenger trains rely on track owned, operated and dispatched by freight rail companies.
In brief remarks in the Rose Garden late in the morning, Biden said the agreement would provide a more than 24 percent wage boost over five years and would cap the contributions that workers pay for health care. “They earned and deserve these benefits,” he said.
Biden said freight companies will be able to retain and recruit workers because of the deal.
“It is a win for tens of thousands of rail workers who worked tirelessly through the pandemic,” Biden said in his statement released overnight by the White House. “These rail workers will get better pay, improved working conditions and peace of mind around their health care costs — all hard-earned.”
The Labor Department said the agreement came after 20 consecutive hours of negotiations. “A disruption would have had catastrophic impacts on industries, travelers and families across the country,” the department said in a statement.
Sanders said on the Senate floor Wednesday that the outstanding issue in the talks was sick leave. He made his comments after Sen. Richard M. Burr, R-N.C., asked for unanimous consent to approve a joint resolution that would require the workers and unions to accept the emergency board’s recommendations. Those recommendations on Aug. 16 started a 30-day cooling-off period that expires Friday.
Burr also urged Senate Majority Leader Charles E. Schumer to bring the resolution to the floor for a vote, pledging to deliver 48 Republican votes for passage. The Senate’s rules may have made it difficult to hold a vote before the Friday deadline, but Democrats also may have been reluctant to resist union pressure.
The International Association of Sheet Metal, Air, Rail and Transportation Workers, or SMART, Transportation Division had urged its members and supporters to tell lawmakers not to intervene.
“The Railroads have been working overtime in Washington with the bad faith tactics of getting Congress to side with them in our dispute,” the union said in a message to workers. “Send a message today asking Congress to stay out of our dispute (or side with us, if they must intervene).”
The strike threat came at a sensitive economic and political time. Annual inflation above 8 percent is at about a 40-year high, in part because of supply chain disruptions that began with the outbreak of COVID-19 in 2020 and worsened with Russia’s invasion of Ukraine in February. Further disruption from a rail strike would have come ahead of the November elections, which polls show to be unusually close for midterms.
“We’re just learning about a tentative deal that would let unions back away from the cliff,” Sen. Charles E. Grassley, R-Iowa, said on the Senate floor Thursday. “If they don’t, then Congress must step in.”
House Majority Leader Steny H. Hoyer, D-Md., welcomed the news, including for workers, carriers and “the American people eager to avoid seeing costs go up as we continue to address inflation.”
“While this agreement moves forward, Congress will stand ready to do whatever it takes to avert a work stoppage and ensure that our strong economic recovery and efforts to ease supply chain disruptions and inflation can continue uninterrupted,” he said in a statement.
American Trucking Associations CEO Chris Spear issued a statement Thursday praising the agreement. The administration had been preparing in recent days to find alternatives to freight to help soften impact.
“Our supply chain is entirely interdependent, making the potential for a nationwide rail stoppage a serious threat to our nation’s economic and national security,” Spear said. “We applaud both sides for reaching a tentative agreement that averts this outcome and permits our supply chain to continue climbing out of this COVID-induced rut.”