National Rail Strike Likely as Largest Union Rejects Labor Agreement

November 21, 2022 | The Toy Association is alerting members that a nationwide rail strike may happen as early as December 5 as a fourth railroad union did not ratify a tentative collective bargaining agreement reached in September. The strike would have a projected impact of $2 billion per day and halt approximately 7,000 freight trains, according to the Association of American Railroads.

“The peak holiday shopping season is upon us, and while many of our members planned early to get enough product stateside to meet consumer demand, a nationwide rail strike will have devastating impact on the economy,” said Ed Desmond, executive vice president of global government & regulatory affairs at The Toy Association. “The issue goes beyond making sure product gets on shelves this holiday season. Consumers could face higher prices on top of inflation, thousands of jobs are on the line, and even drinking water could be at stake, among other issues. Congress should have a plan to intervene immediately.”

The Toy Association’s Global Government & Regulatory Affairs team is engaged on the issue and is continually assessing potential member impacts from the situation.

The International Association of Sheet Metal, Air, Rail and Transportation Workers (SMART-TD) — the largest rail labor union — joined the Brotherhood of Maintenance of Way Employees Division of the International Brotherhood of Teamsters (BMWED); Brotherhood of Railroad Signalmen (BRS); and International Brotherhood of Boilermakers, Iron Ship Builders, Blacksmiths, Forgers & Helpers (IBB) in rejecting the deal. The main issue at hand is sick day provisions.

The BMWED and BRS have cooling down periods, a timeframe in which both sides return to the bargaining table and assure no strikes or lockouts, that end December 4, while IBB’s cooling down period ends December 9. Reports indicate that BMWED and BRS may seek a five-day extension to align with IBB’s timeline.

The Brotherhood of Locomotive Engineers and Trainmen (BLET), the second-largest union that also announced its voting results earlier today, approved the contract. Although eight of the 12 unions have ratified the agreement, an industrywide strike looms because if one union stops working in early December, the others are unlikely to cross picket lines.

The Association had previously signed two coalition letters led by the National Retail Federation and U.S. Chamber of Congress urging the White House and Congress, respectively, to get involved in negotiations sooner than later. Now, under the Railroad Labor Act, Congress could get involved to pass legislation that would prevent or end a strike by extending the cooling off period or instituting terms supported by a majority of the unions. However, Congressional leaders would have to act fast because they return from Thanksgiving recess November 28, a week before the first cooling off period ends December 5.