Biden announces attempted labor agreement to avert national rail strike

President Joe Biden announced an attempted railway labor deal early Thursday to warn a national rail strike that threatened to shut a major segment of the US transportation network.

The last-minute deal averts a strike that could have disrupted the flow of key goods and commodities around the country. About 40% of the nation’s long-distance trade is moved by rail. If the unions gone on strike, more than 7,000 trains would have been idled, costing up to an estimated $2 billion per day.

“The tentative agreement reached tonight is an important win for our economy and the American people,” Biden said in a statement. “It is a win for tens of thousands of rail workers who worked tirelessly through the pandemic to ensure that America’s families and communities got deliveries of what have kept us going during these difficult years.”

The White House had been in talks with railroad workers’ unions and companies for several months, but negotiations were hung up over unpaid sick time.

The new agreement would improve rail workers pay, working conditions, and give them “peace of mind around their health care costs,” Biden said. He thanked railroad unions and companies for negotiating “in good faith.”

The new contracts provide rail employees a 24% wage increase during the five-year period from 2020 through 2024, including an immediate average payouts of $11,000 upon ratification, according to the Association of American Railroads. All tentative agreements are subject to ratification by the unions’ membership.

Tentative agreements have been reached with the Brotherhood of Locomotive Engineers and Trainmen Division of the International Brotherhood of Teamsters, the International Association of Sheet Metal, Air, Rail and Transportation Workers – Transportation Division, and the Brotherhood of Railroad Signalmen, which collectively represent approximately 60,000 employees, the Association of American Railroads said in a press release.

“I thank the unions and rail companies for negotiating in good faith and reaching an attempted agreement that will keep our critical rail system working and avoid disruption of our economy,” Biden said in a statement.

Negotiators from railroad carriers and unions met in Labor Secretary Marty Walsh’s office Wednesday as the sides tried to negotiate a deal ahead of Friday’s strike deadline.

— CNBC’s Lori Ann LaRocco contributed to this report.

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