President Joe Biden said he will sign a bill aimed at preventing a “Christmas catastrophe” rail strike following a bi-partisan vote in the Senate late Thursday.
Lawmakers voted 80 to 15 to approve a House bill that will impose terms of a deal brokered by the White House in September between rail unions representing around 115,000 workers and freight train operators. A separate vote on paid sick leave, approved by the House of Wednesday, failed to pass in the Senate.
The bill would make it illegal for workers to strike, but would also impose terms of the September agreement, which includes pay increases, improved working conditions and ‘peace of mind’ with respect to healthcare benefits.
The September agreement, formed by an internal White House task force known as the Presidential Emergency Board, recommended 24% pay hikes, spread over five years, $5,000 in employee bonuses and additional paid leave as part of a package that formed the basis of a tentative agreement with around 115,000 workers earlier this summer.
According to the Association of American Railroads, the country’s freight rail network comprises 140,000 miles of track across 49 states and carries 7,000 long-distance Class I trains per day.
The strike itself, which was set to go into effect as early as December 9, could cost the economy around $2 billion a day, shut down around 30% of the country’s freight traffic, disrupt passenger rail networks and add to inflationary pressures by delaying the delivery of key energy, food and consumer goods.
“Working together, we have spared this country a Christmas catastrophe in our grocery stores, in our workplaces, and in our communities,” Biden said in a statement. “I know that many in Congress shared my reluctance to override the union ratification procedures. But in this case, the consequences of a shutdown were just too great for working families all across the country.”
“And, the agreement will raise workers’ wages by 24%, increase health care benefits, and preserve two person crews,” the President added.
CSX Corp (CSX) – Get Free Report shares were marked 0.65% higher in pre-market trading following the Senate vote and the President’s statement to indicate an opening bell price of $32.89 each. Union Pacific (UNP) – Get Free Report shares, meanwhile, slipped 0.4% to $215.08 each.
Norfolk Southern NCS was little-changed at $256.36 each.