US House votes to avoid rail strike

The US House of Representatives approved a bill to override union objections to a proposed rail worker contract, a move meant to avoid a nationwide strike that threatens widespread economic disruption.

In a 290-137 vote the House today voted to require unions to accept a rail labor agreement brokered by the White House in September even though the contract remains unratified by four of the 12 major unions that collectively represent over 100,000 US rail workers. President Joe Biden earlier this week called on Congress to act to allay the strike that could spur widespread shortages and boost gasoline pump prices.

The bill must be approved by the Senate and signed by Biden before becoming law. Absent congressional action a rail strike could be initiated as soon as 9 December.

The White House warned that a strike could spur 765,000 US job losses and "cripple the American economy" with shortages spanning virtually every segment of the US supply chain, ranging from gasoline and home heating fuels to fertilizers and retail goods.

Republicans who supported the bill said that they were compelled to act because the White House was unable to get the rail labor deal across the finish line, after celebrating a tentative agreement in September. Biden's administration fell short and "now it falls on Congress to clean up his mess," said representative Troy Nehls (R-Texas). Without congressional action, "the cost of moving anything will skyrocket overnight, just in time for Christmas."

The bill put many Democrats in an awkward position of voting to over-ride the objections of unions, even as Biden has portrayed himself as a pro-labor leader. "Under President Joe Biden we've had the most pro-union administration in history," speaker Nancy Pelosi (D-California) said, heaping scorn on railroads for reaping "obscene profits" and "selling out to Wall Street."

The new labor contracts codified in the House bill include a 24pc percent wage hike over five years, but lack provisions for improved paid sick leave that became the main sticking point for several unions. The House voted 221-207 to approve a separate measure to raise the number of paid sick leave days for rail workers to seven days from one day.

Senate leader Chuck Schumer (D-New York) yesterday said he would work with minority leader Mitch McConnell (R-Kentucky) to bring a House-approved measure to a Senate vote as quickly as possible.

Congress has acted to avert rail strikes 16 times in the past, most recently in 1992, under the authority of the Railway Labor Act, which gives lawmakers broad authority to intervene in rail labor disputes. The last national rail labor strike was in 1991 and lasted less than 24 hours before then-president George Bush signed congressional legislation to end it.

Lobbying groups warned that rail strikes could cause severe disruptions across virtually every segment of the US supply chain, ranging from gasoline to fertilizers to retail goods. Schumer warned that a strike could interrupt railed shipments of chlorine, which are essential for city water treatment plants, while the fertilizer industry warned movement of ammonia would stop as soon as this weekend without intervention.

A rail strike could also crimp deliveries of ethanol, which is required to be blended with US gasoline supplies to meet federal air quality mandates. Because of corrosive properties that make it unsuitable for pipeline transport, about 95pc of US ethanol supply moves by rail, according to the American Petroleum Institute (API).

Even a one-day rail stoppage could lead to "disastrous shortages in the gasoline market" and boost fuel pump prices ahead of the US holiday season, API chief executive Mike Sommers warned.

By Chris Baltimore