Tentative Deal Reached To Avert Devastating Rail Strike Ahead Of Midterms

Unions and railroad management avoided a devastating freight railroad strike early Thursday morning. The announcement came from the White House just after 5 a.m.

A tentative deal has been reached to avert a labor action that threatened to seriously damage U.S. supply chains and send inflation even higher with the pivotal November midterm elections looming.

The strike could have sidelined 300,000 barrels of oil a day as well as major food shipments during the current harvest season.

There were many in the industry who felt that the strike was inevitable, and Amtrak had already canceled several scheduled routes to try to avoid disruptions.

The deal was reached with the unions representing over 50,000 engineers and conductors. In a statement, the Biden administration called it “an important win for our economy and the American people.”

The strike was scheduled to begin at 12:01 a.m. ET on Friday and talks that began Wednesday morning lasted for 20 hours. Labor Secretary Matt Walsh hosted the negotiations between railroad workers and management.

Terms of the tentative deal, which must still be approved by union members, give the engineers and conductors an immediate 14% pay raise with back pay through 2020.

Throughout the five-year span of the contract, the raises total 24%. Cash bonuses for conductors and engineers of $1,000 per year are also included. There are few other details currently known of the deal worked out in the overnight hours.

In a statement afterwards, Biden acknowledged that the rail workers will get higher pay, better working conditions, and peace of mind about their health care expenses.

President Joe Biden called the negotiators personally around 9 p.m. in an attempt to spur the talks along. The specter of a shutdown of rail freight in the country undoubtedly had Democrats worried about the fallout in coming elections, and Biden applied pressure to get a deal done.

He reportedly reminded negotiators of the potentially catastrophic effects a freight railroad strike would have on workers and families across the country.