The Presidential Emergency Board, the organization charged with helping to resolve contract differences between the U.S. Class I railroads and their unionized workforce, made its recommendations Tuesday in a report to the White House, the railroads, and organized labor.
The board recommended a 22 percent wage increase, along with $5,000 in service recognition bonus payments, over the five-year life of the contract retroactive to Jan. 1, 2020. The recommendation was less than the Union’s desired 28 percent increase but more than the railroads’ proposed 16 percent increase. The two entities were $9 billion apart in their wage proposals, the board said in its report.
The board also recommended “modest improvements” in health and welfare benefits packages and no reductions in benefits or a shift in cost-sharing. The board also recommended the railroads and unions further negotiate on engineer and conductor scheduling and said that if an agreement can’t be reached, the matter should be settled through binding arbitration.
“The Board hopes that this may prove to be a ‘win-win’ in which the Carriers obtain a more efficient and reliable system for manning the locomotives, with both operational benefits and cost savings, and employees will obtain preferred schedules with more control over their personal lives when not otherwise scheduled,” the report says.
The report triggers a 30-day cooling-off period between the unions and the railroads. Previous negotiations had failed to reach any agreements. While few believe a strike is likely, some admit a strike is a possibility.
Railroad advocates said the recommendations would go a long way in resolving ongoing rail labor negotiations and that the proposal would provide an immediate pay increase for railroad employees.
“President Biden’s PEB issued recommendations that should set the framework for a negotiated agreement between railroads and unions,” said Association of American Railroads President and CEO Ian Jefferies. “The recommendations would provide 24 percent compounded wage increases by 2024, with 14.1 percent of those increases effective immediately, along with additional service recognition bonuses totaling $5,000 over the course of the contract. An agreement based on these terms would lead to the largest general wage increase in nearly 40 years.”
Jeffries said the recommendation is an opportunity both sides should take to come together and reach an agreement.
Advocates for passengers and communities served by railroads said they were hopeful the recommendations would lead to an agreement.
“Passengers and Amtrak-served communities who rely on rail for work, school, medical visits, and more are watching these negotiations with great interest,” Rail Passengers Association President & CEO Jim Mathews said in a statement. “We are cautiously hopeful that the PEB’s recommendations have created a framework for meaningful improvements for engineers and conductors that Class I railroads can live with. Although the PEB does not address the scheduling and precision-scheduled railroading (PSR) questions directly, these issues remain in formal mediation; America’s passengers are depending on all sides to work in good faith to reach a fair deal that will allow these essential services to continue—for everyone, but especially for the most vulnerable passengers with few or no other alternatives to rail.”