The Biden administration on Monday urged railroads and unions to reach a deal to avoid a shutdown of the rail system, saying it would pose “an unacceptable outcome” to the U.S. economy.
Earlier, the U.S. Chamber of Commerce called for “urgent action” in railroad labor negotiations to avoid a strike and a “national economic disaster” that could cost $2 billion a day.
Unions and railroads, including Union PacificUNP.N, Berkshire Hathaway’sBRKa.NBNSF, CSXCSX.O, and Norfolk Southern, have until a minute after midnight on Friday to reach tentative deals with unions representing about 60,000 workers. Failing to do so opens the door to union strikes, employer lockouts, and congressional intervention.
U.S. Labor Secretary Marty Walsh is postponing travel to Ireland to remain engaged in talks, the department said Monday.
“The parties continue to negotiate, and last night Secretary Walsh again engaged to push the parties to reach a resolution that averts any shutdown of our rail system,” a Labor Department spokesperson said. “All parties need to stay at the table, bargain in good faith to resolve outstanding issues, and come to an agreement.”
At midday on Tuesday, Norfolk Southern CorpNSC.Nwill stop accepting intermodal cargo: goods that move by combinations of ship, truck, and rail transport.
That could exacerbate existing backups at East Coast seaports and inland hubs, causing cascading delays across the country as farmers prepare for harvest and retailers restock stores for the all-important Christmas shopping season.
The Chamber of Commerce called on Congress to take immediate action if railroads and unions are unable to come to a voluntary agreement.
“A shutdown of the nation’s rail service would have enormous national consequences. It would lead to perishable foods such dairy, fruits, and vegetables spoiling at their points of origin, would halt Amtrak service … disrupt materials and goods being delivered to factories and ports, and would inhibit the transport of heating fuel and other important fuels and chemicals,” the Chamber said.
The Labor Department said there have been dozens of calls by Cabinet officials and other top administration officials to help the sides reach agreement.
On Sunday, two unions negotiating contracts for almost 60,000 workers at major U.S. freight railways said those employers are halting shipments of some cargo to gain leverage ahead of this week’s deadline to secure labor agreements.
As of Sunday, eight of 12 unions had reached tentative deals covering about half of 115,000 workers, the National Railway Labor Conference (NRLC) said. Those groups do not include SMART-TD and BLET. Three unions reached agreements on Sunday.
Railroads late last week said they would begin halting shipments of hazardous and toxic materials starting on Monday to ensure safety in the event of a strike.
The brinkmanship comes at a sensitive time for unions, railroads, shippers, consumers, and President Joe Biden – who appointed an emergency board to help break the impasse.
Widespread railroad disruptions could choke supplies of food and fuel, spawn transportation chaos, stoke inflation, and cause $2 billion per day in lost economic output.
