US Congress votes to block potential rail strike

Labour activists in Washington DC

US lawmakers have voted to approve a bill to stave off a strike by railway workers that could potentially devastate the US economy.

The bill, which passed 290 to 137 in the House of Representatives, binds companies and workers to a September agreement brokered by the Biden administration. It now heads to the Senate.

The House also passed a separate bill to mandate paid sick leave for workers.

President Joe Biden this week urged the US Congress to take measures to step in and prevent the railroad strike, warning that “the economic impact of a shutdown would hurt millions of other working people and families”.

A rail worker labour stoppage could happen as soon as 9 December.

Economists, business organisations, and railroad companies have said that the strike would disrupt the flow of fuel, medicine and other vital commodities and bring with it an estimated economic hit of $2bn each day.

The new measure passed by the House on Wednesday imposes a previous agreement that was rejected by four of the 12 labour unions involved in the negotiations, which collectively represent over 100,000 freight carrier employees.

The deal included 24% raises – the most in more than 40 years – and $5,000 in bonuses stretched over a series of annual payments. While employees would be expected to pay a larger portion of their health insurance costs, premiums would be restricted to a maximum of 15%.

A separate bill passed by a narrow margin of 221 to 207 votes in the House of Representatives would guarantee seven days of paid sick leave each year for workers covered by the deal. It is unclear whether it has enough support to pass in the Senate. Labor Secretary Marty Walsh and Transportation Secretary Pete Buttigieg were both expected to speak to Senate Democrats about the issue on Thursday.

“We know much more needs to be done for railroad workers,” Speaker Nancy Pelosi said during remarks on the House floor. “No one should be at risk of losing his or her job by staying home when sick, needing to see a doctor, or getting lifesaving surgery.”

The issue of paid sick leave was contentious during prior negotiations, with the unions – which had previously expressed a preference for higher wages and strong disability benefits over sick days – arguing that the immensely profitable railroad companies could afford them with minimal impact.

Earlier in the week, the head of the Association of American Railroads said that while the railroads would consider the move, it would do so in future additional negotiations.

In a statement following the bill’s passage in the House, Mr Biden urged the Senate to “act urgently”.

The statement added that, “without the certainty of a final vote to avoid a shutdown this week” railroads would begin to halt the movement of critical materials and there could be early supply chain disruptions.

The potential rail strike presents a political challenge for Mr Biden and the Democrats, who have repeatedly sought to portray themselves as labour-friendly and pro-union. Some rail employees and union members have expressed dismay at the administration’s efforts to step into the labour dispute.

Republicans, for their part, have supported efforts to prevent the strike, while also taking aim at the Biden administration for its handling of the issue.

In total, the companies with employees that would go on strike transport 40% of the country’s freight, including 75% of new cars, 70% of coal and 30% of packaged goods. About 7,000 freight cars could be taken out of service each day, sending prices skyrocketing and creating a political headache for the Biden administration.

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