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WASHINGTON/LOS ANGELES (Reuters) – The two largest U.S. rail unions representing conductors and engineers are set to announce Monday results of votes on a tentative contract deal reached in September amid growing concerns a possible work stoppage could cause significant damage to the U.S. economy and strand vital shipments of food and fuel.
The Brotherhood of Locomotive Engineers and Trainmen (BLET) and the transportation division of the International Association of Sheet Metal, Air, Rail, and Transportation Workers (SMART-TD) — representing about half of all unionized rail employees are set to report results. Seven of the 12 unions involved in the talks have approved the deal, while three have voted against it but agreed to extend a strike deadline until at least Dec. 4.
The standoff between U.S. railroad operators and their union workers disrupted flows of hazardous materials such as chemicals used in fertilizer and disrupted U.S. passenger railroad Amtrak service in September.
The Biden administration helped avert a service cutoff by hosting last-minute contract talks in September at the Labor Department that led to a tentative contract deal.
White House press secretary Karine Jean-Pierre said last month “any shutdown would be completely unacceptable. It is the responsibility of the parties involved to resolve this issue.”
Last week, the U.S. Chamber of Commerce said Congress should step in to prevent a potential rail disruption, warning it would be catastrophic for the economy. Automaker General Motors (NYSE:GM) has said a halt would force it to stop production of some trucks within about a day.
A rail shutdown could freeze almost 30% of U.S. cargo shipments by weight, stoke inflation, cost the American economy as much as $2 billion per day and unleash a cascade of transport woes affecting U.S. energy, agriculture, manufacturing, healthcare and retail sectors.
The deal included a 24% compounded wage increase over a five-year period from 2020 through 2024 and five annual $1,000 lump sum payments.
The unions represent 115,000 workers at railroads, including Union Pacific (NYSE:UNP) , Berkshire Hathaway (NYSE:BRKa) Inc’s BNSF, CSX (NASDAQ:CSX), Norfolk Southern (NYSE:NSC) and Kansas City Southern (NYSE:KSU).
Labor unions have criticized the railroads’ sick leave and attendance policies and the lack of paid sick days for short-term illness.
The National Carriers’ Conference Committee (NCCC), which represents the nation’s freight railroads in talks, says the deal has the most “generous wage package in almost 50 years of national rail negotiations.”
