Updated June 16, 2022
Q: Who are the parties to national bargaining?
A: The Class I freight railroads currently are in national bargaining with two separate union coalitions that collectively represent all 115,000 employees in the bargaining round: (1) the Coordinated Bargaining Coalition (CBC), which represents approximately 80 percent of the employees; and (2) the BMWED/SMART-MD Coalition, which represents the remaining 20 percent.
Q: What is the status of national bargaining?
A: The railroads entered mediation with the BMWED/SMART-MD Coalition in June 2021 and the CBC in late January 2022. On June 14, the NMB elected to end the mediation process and offered the parties an opportunity to submit their dispute to binding interest arbitration.
The railroads would consider accepting the proffer of arbitration, but the union leadership has already indicated they will not. Because both sides would need to accept the proffer for it to take effect, the unions’ anticipated rejection of binding arbitration means the parties will soon enter a 30-day “cooling off” period. More information on how the bargaining process works under the Railway Labor Act is available here.
Q: Will negotiations continue?
A: The railroads believe in the collective bargaining process and will remain willing and available to negotiate at any time over mutually acceptable agreement terms. It remains in the best interests of all parties – and the public – to settle this dispute, provide for prompt pay increases for all rail employees, and prevent rail service disruptions.
Q: What happens if the parties fail to reach agreements by the end of the cooling off period?
A: The RLA provides that the President of the United States may appoint a Presidential Emergency Board (PEB) to investigate and make recommendations for settlement. The railroads expect a PEB will be appointed in this dispute before the end of the 30-day cooling off period, as has been the case in prior unresolved national rail negotiations. A PEB has 30 days to conduct hearings and issue a report. Work stoppages are prohibited during this time and for another 30 days following the issuance of the report.
Q: Are the PEB’s findings binding on the parties?
A: No, but the PEB’s recommendations often serve as the basis for voluntary settlement.
Q: Why haven’t the parties reached an agreement yet?
A: In mediation, the railroads have worked to address issues raised by both sides. The railroads’ proposals offer rail employees well-deserved pay increases that are consistent with other labor settlements and would continue to place industry pay and benefits among the best in the nation. However, the parties have remained apart in their positions and an agreement has not been reached.
Q: Have the carriers proposed to increase employee pay?
A: Yes, the railroads are proposing significant increases to be effective on July 1, 2022, along with full retroactive pay for increases to be attributable to 2020 and 2021. These proposed pay increases – along with future proposed increases in 2023 and 2024 – would ensure that employees keep pace with the broader labor market and, more importantly, keep rail employees among the best paid in the nation.
Recent statements by labor leaders claiming the carriers are not proposing pay increases are false. These statements seem to be based upon the unsupported notion that pay rates must increase each year by an amount that is greater than the percentage increase in the highest available consumer inflationary measure. But that is not how pay is determined by all types of companies, large and small, in industries across the country. Instead, companies use benchmarks in the relevant labor market to establish compensation – and those benchmarks have guided the railroads’ proposals.
Q: Are carriers demanding health care concessions?
A: The national railroad health care plans provide comprehensive benefits to 320,000 railroad employees and their family members, with low member out-of-pocket costs via plan design provisions (deductibles, copays, coinsurance, out-of-pocket maximums, etc.) and low monthly premiums for employees to cover themselves and all eligible family members. The current plan design provisions and contribution levels – which have not changed since 2019 and 2016, respectively – result in member costs for healthcare far below the national average.
The railroads’ proposals will maintain comprehensive, high-quality, low-cost health care benefits for rail employees and their families. The proposals do include updates to the contribution rates and design features to bring them more in line with benchmark norms for unionized work groups. These proposals would also provide meaningful investments in certain health care programs and services to improve upon current provisions and provide employees and their families with access to many new and valuable resources. These are the types of changes and improvements that most employees in the U.S. experience every year and are similar to changes the railroads and rail unions have previously negotiated in national agreements.
Q: Will there be a service disruption?
A: For decades, the process provided under the Railway Labor Act (RLA), which includes the possibility of a PEB, has been remarkably successful in facilitating national contract settlements without service disruptions. In fact, the last service disruption due to a dispute arising from national bargaining was in the early 1990s.
As noted above, strikes and work stoppages are prohibited during the initial 30-day cooling off period, while the PEB completes its work, and during a final cooling-off period after the PEB report has been issued.
Even when the parties have been unable to eventually reach voluntary agreements in prior bargaining rounds after a PEB has issued its recommendations, Congress has intervened to prevent or stop rail service disruptions. For instance, in the early 1990s, Congress required the railroads and many of the rail labor unions to engage in final and binding interest arbitration of an industry-wide collective bargaining dispute to prevent disruptions to shipping activities. In the absence of an agreement, it is possible that Congress would intervene in the current round to prevent disruptions to the supply chain.
Q: A union recently announced that it is seeking a strike authorization from its members. Does this mean there will be a strike?
A: Unions often invoke the strike authorization processes in their constitutions or bylaws. However, this does not mean that a strike will occur. As described in more detail above, the RLA prohibits strikes and work stoppages during mediation and for a period of time thereafter – regardless of whether the union membership has authorized a strike.
Q: What is the status of negotiations over crew size?
A: The carriers have proposed to redeploy conductors from the cab of the locomotive to ground-based positions in PTC-enabled territory. This is an important issue for both the railroads and the employees. For the railroads, redeploying conductors will allow the carriers to continue to operate safely but more efficiently while maintaining customer service levels. On the employee front, ground-based conductor positions are expected to be regular assignments with predictable schedules. This type of scheduling will significantly enhance employee quality of life by eliminating the need for many conductors in through-freight service to overnight away from home.
The carriers invited SMART-TD to negotiate nationally over the crew size issue at the outset of the bargaining round, but this invitation was rejected. As a result, direct bargaining over crew size (which was delayed almost two years until SMART-TD legal and procedural objections could be resolved) has taken place on a carrier-level basis. Nevertheless, there continues to be a clear connection between the carrier-level negotiations and national bargaining. The NCCC believes crew size must be addressed across the industry and views resolution of the carriers’ crew size and redeployment proposals in conjunction with the current bargaining round as a matter of the highest priority.
Q: Where can I find additional information?
A: Additional information about the bargaining round can be found at www.raillaborfacts.org.