National bargaining between the freight railroads and three union coalitions representing the employees are at a critical stage, with the parties far apart and now in mediation.
The railroads, represented by the National Carriers’ Conference Committee, have welcomed the involvement of the National Mediation Board, an independent agency that assists labor negotiations in the railroad and airline industries.
Timely resolution not only is in the interests of both sides, it is essential for the nation’s economy, which relies on freight railroads.
Negotiations are occurring as the industry faces profound challenges: declines in volumes and revenues, and transformational changes in energy markets. The challenges, coupled with the industry’s massive capital requirements, make management of all costs, including labor costs, fundamental for continued success and growth.
Health care remains a significant challenge. The health plan for railroad employees is dramatically out of sync with comparable plans across the nation. Employees pay far less for their generous benefits than the vast majority of American workers. At the same time, railroad employees are among the most highly compensated in the nation.
The railroads are seeking fair and voluntary settlements with the unions, proposing reasonable wage increases and prudent health plan reforms to bring design and cost-sharing features closer to the mainstream.
The railroads and unions negotiate under the 1926 Railway Labor Act, which includes safeguards to minimize service disruptions because of labor disputes. Under the law, collective bargaining agreements remain in force indefinitely until the parties agree to change them.
More than thirty railroads, including BNSF, CSX Transportation, Kansas City Southern, Norfolk Southern, and Union Pacific, are participating in this bargaining round.