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Carriers won’t lock out staff, negotiators meet with Labor secretary

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

The meeting began just after 9 a.m. ET. A spokesperson for the Labor Department said talks were ongoing as of midday. “The parties are negotiating in good faith and have committed to staying on the table today,” the representative said.

Walsh’s involvement comes because the Biden administration prepares for a piece stoppage. A strike, which could affect about 60,000 staff and idle greater than 7,000 trains, could cost the U.S. economy greater than $2 billion a day. On Wednesday, Amtrak said it will cancel its long-distance train service starting Thursday because it operates nearly all of its route miles on freight railroads.

The railroads, for his or her part, “don’t have any plans to lock out staff Friday should negotiations not be successfully accomplished,” the Association of American Railroads told CNBC.

Dennis Pierce, the unions’ top negotiator, said members have warned 10% of the workforce could leave if the problems aren’t resolved before the deadline. Sick time policies and quality of life concerns were the largest sticking points remaining.

“Our proposal of no paid sick time costs them no money. It’s something they’ll manage. It doesn’t harm their business model,” said Pierce, who’s the president of the Brotherhood of Locomotive Engineers and Trainmen, or BLET. “The railroads need to start out treating employees like humans, as a substitute of imposing these policies which can be just running people out of the industry.”

Eight of 12 railroad unions have reached tentative deals with corporations as of earlier this week, but two of the largest unions, BLET and the SMART Transportation Division are still talking to carriers. The 2 groups represent about half of union railroad staff. Earlier Wednesday, a smaller union, the International Association of Machinists and Aerospace staff voted against a deal.

Countdown to massive rail strike

The so-called cooling off period, which allowed each side to proceed negotiations, ends at midnight Friday, meaning a strike could occur within the early morning hours. In anticipation of a strike, the railroads have already began diverting freight.

Labor unions have begun distributing strike information to members within the event a deal cannot be reached by the deadline. An individual acquainted with the negotiations said the step is “normal procedure to get union staff ready for a strike.”

“This is just not a sign a strike will indeed occur. This is a component of preparation procedures,” said the person, who asked to not be named because they weren’t authorized to talk publicly in regards to the efforts.

In an email to members, the National Customs Brokers & Forwarders Association of America listed the timeline of closures. CNBC has compiled an inventory of just a few of the rail changes ahead of the deadline:

  • Wednesday: BNSF, which is owned by Berkshire Hathaway, stops moving refrigerated units into inland facilities
  • Wednesday: Norfolk Southern stops receiving exports
  • Thursday: CN stops receiving exports

Norfolk Southern and the opposite railroads have been ramping down freight in anticipation of a strike to maneuver critical hazmat materials, akin to chlorine and ethanol. This freight is taking priority over common freight.

But NS told CNBC it has altered some plans to accommodate more regular cargo.

“We proceed to supply essentially the most flexibility as we are able to for patrons for so long as they’ll,” a spokesperson for the railroad told CNBC on Wednesday. “Now we have prolonged the time period to simply accept trucks bringing containers into our land terminals until 5 pm tonight.”

Originally, NS intended to stop accepting containers Tuesday.

Recovering from the disruption created by a strike could take weeks, if not months, in keeping with CNBC.

“Delivery of oversized transformers for transmission and distribution, natural gas turbines, and power generators, in addition to renewable technology akin to wind tower sections and blades, depend on the U.S. rail systems,” said Marco Poisler, COO of UTC Overseas, warning of “overwhelming delays” for deliveries.

“Transporting such cargo takes months of planning and rail engineering resources to discover available specialized rail assets with the fitting axle spread and deck height to realize railroad clearance,” Poisler said.

The Biggest Sticking Points Remaining in Critical Contract Talks Between U.S. Railroads and Labor Unions

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