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Tag: Labor Disputes

  • UAW strike: 12,700 Ford, GM and Stellantis auto workers walk off the job

    UAW strike: 12,700 Ford, GM and Stellantis auto workers walk off the job

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    Nearly 13,000 U.S. auto workers went on strike early Friday after the Big Three and the United Auto Workers failed to reach an agreement before their national contract expired just before midnight.

    UAW President Shawn Fain called the targeted strike at a Ford Motor
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    plant in Michigan, a General Motors
    GM,

    plant in Missouri and a Stellantis NV
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    plant in Ohio. A strike at all three U.S. car makers is a break with tradition, as the union for many years has elected to center strike efforts at one company to protect its strike fund and picket-line firepower. Fain said the union could add more plants to strike as part of its strategy to keep the automakers guessing, and urged all 150,000 UAW members to be ready if and when they’re called to strike.

    “This is our generation’s defining moment,” Fain said Thursday night as he addressed UAW workers by webcast two hours before the deadline. “The money is there. The cause is righteous.”

    Fain said the union is committed to a contract that reflects the “incredible sacrifices and contributions” that its members have made for years. The union has said wages for auto workers who make the top rate have risen about 6% over the past four years, while the three automakers’ North American profits have increased about 65% during that time.

    The union is asking for double-digit wage increases, an end to tiered wages and benefits, the restoration of pensions and cost-of-living adjustments, retiree pay increases and more.

    A Stellantis spokesperson said the company is in contingency mode and sent the following statement: “We are extremely disappointed by the UAW leadership’s refusal to engage in a responsible manner to reach a fair agreement in the best interest of our employees, their families and our customers.”

    A GM spokesperson said the company will continue to bargain with the union and that “we are disappointed by the UAW leadership’s actions, despite the unprecedented economic package GM put on the table, including historic wage increases and manufacturing commitments.”

    Ford did not immediately comment after the strike began, but said in a statement earlier Thursday night that it was unhappy with the union’s counterproposal: “If implemented, the proposal would more than double Ford’s current UAW-related labor costs.”

    GM’s Wentzville, Mo., plant, which the union said has about 3,600 UAW members, builds some of the car maker’s mid-size trucks and full-size vans, including the Chevy Colorado and the GMC Canyon. Ford’s plant in Wayne, Mich., makes Ford Broncos, and about 3,300 members who work in final assembly and paint would be striking. The Stellantis Toledo, Ohio, plant, which has about 5,800 UAW members, makes Jeep Gladiators and Wranglers.

    UAW members join workers around the nation and across industries — such as Hollywood writers and actors, hotel staff and healthcare workers — who are on strike or are preparing to walk off their jobs. Fain reiterated to UAW members Thursday night that amid rising economic inequality, he looks at the auto workers’ strike as part of a larger battle between the haves and the have-nots.

    Michelle Kaminski, associate professor in the School of HR and Labor Relations at Michigan State University, said in an interview with MarketWatch that “when the union president says this is a generational strike, I really agree with him.”

    She added: “When I think about economic conditions, they are more favorable to the union now than [at any point] in the 30 years I’ve been in this field.” She said auto workers have “given up a lot” over the past couple of decades as the companies have needed both government help and worker concessions to survive.

    Kaminski also cited the auto makers’ profit and financial position; the pandemic’s effect on the labor force and how workers’ commitments to their jobs have changed; and increasing inflation as factors in why she sees the timing as key. “The union’s window of opportunity is right now,” she said.

    But CFRA analyst Garrett Nelson said in an interview with MarketWatch that the union “needs to be careful not to overplay their hand, as the balance sheets of the Detroit three are flush with cash and they can probably wait things out longer than the workers can.”

    Automakers could weather a strike, although anything longer than about two weeks is viewed as more impactful and detrimental to the companies. GM has about $39 billion in cash and equivalents, while Ford has around $51 billion, according to a recent Moody’s Investors Service report. Stellantis’s cash and equivalent pile towers over the others, at $69 billion.

    The union’s strike fund starts at $825 million, and striking workers will receive $500 a week. Fain said earlier this week that a targeted strike would help the union have flexibility and apply pressure to the companies as negotiations continue; analysts say it means the union wouldn’t deplete its strike fund so quickly.

    See: Why United Auto Workers are fighting to end a two-tier system for wages and benefits

    The effects of the strike could be far-reaching, both for the companies and workers who may not necessarily be on the picket lines.

    Nelson said the union’s strategy of targeting specific plants could turn into a supply-chain “logistical nightmare” for the auto makers. They will have to adjust deliveries of specific parts to their assembly plants, and the average vehicle is made of more than 30,000 parts.

    “The automotive supply chain is among the most complex of any industry,” Nelson said. “Not knowing which plants the UAW will target in advance could create a massive level of uncertainty and have a crippling impact on production. If the strike goes on for too long, we think auto suppliers could have to cut production and furlough workers at their plants, creating a ripple effect across the industry.”

    Major suppliers’ balance sheets are not as strong, and GM, Ford and Stellantis together generally account for between 25% and 45% of their net sales, so the degradation of the supply chain is a major risk in the event of a prolonged strike.

    The U.S. Chamber of Commerce this week warned about the potential widespread impact of a UAW strike. In a letter to President Joe Biden urging him to help the parties reach an agreement, the chamber said the “Detroit Three are critical to our economy.” More than 690,000 supplier jobs are tied to the auto makers, along with about 660,000 dealership jobs, the chamber said.

    “A strike will quickly impact large segments of the economy, leading to layoffs and potentially even bankruptcies of U.S. businesses,” the chamber said.

    See: Tesla may be the winner of Big Three-UAW labor talks

    Also: Would a United Auto Workers strike push up used-car prices?

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  • UAW strike countdown: Union president says targeted strike possible at all Big Three automakers

    UAW strike countdown: Union president says targeted strike possible at all Big Three automakers

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    United Auto Workers President Shawn Fain said Wednesday that autoworkers and the Big Three automakers are still far apart, although negotiations continue, and that the union may strike all of the Big Three at once.

    “We’re keeping all of our options open. An all-out strike is still a possibility,” Fain said during a webcast with members.

    The UAW and Ford Motor Co.
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    General Motors Co.
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    and Stellantis NV
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    have made progress during their talks but were still far apart on the union’s key priorities, though negotiations will continue until the deadline of 11:59 p.m. Eastern on Thursday, Fain said.

    “For the first time in our history, we may strike all of the Big Three at once,” Fain said, adding that he looked at this time as “our defining moment.”

    He said if no deal is reached, there’s also the possibility of doing “standup strikes” at certain plants, designed to keep the companies guessing. These could escalate and spread elsewhere in order to give the union leverage in bargaining. He told UAW members that they should not strike unless their local is called to do so.

    A targeted strike helps the UAW avoid distributing strike pay, set recently at $500 a week per member, to all 150,000 of its members. But it could have a broader effect.

    “It is possible for strikes at critical parts plants to have much wider implications,” Marick Masters, a business professor at Wayne State University in Detroit, said in an interview with MarketWatch on Wednesday. 

    He noted that the 1998 strike against GM, a work stoppage by 9,200 workers at two of that company’s plants in Flint, Mich., resulted in shutdowns that affected more than 150,000 workers. 

    See: These Ford, GM plants are the most likely strike targets

    Jody Calemine, a senior fellow and director of labor and employment policy at the Century Foundation, a progressive think tank, said Wednesday that the union is employing an interesting strategy.

    “It will turn the screws slowly and probe for weaknesses, and try to get as much movement out of companies as possible while keeping the options to escalate,” he said.

    Calemine said Fain has done a “masterful job” of painting the fight as a “real showdown” between working families and the companies. But he added that “the principal danger for the union would be losing the narrative. Other places would continue to work, or get laid off or locked out.”

    That’s reflected in some of the online comments by UAW members who watched Fain’s update. One worker said on Facebook: “Strike us all or none at all.”

    The UAW president quoted scripture, repeated his calls for unity and said the “strike plan is driven by faith that together we can and will move mountains.”

    Fain said the companies have revised some of their offers: On wages, Ford has put forward a 20% increase over the life of the four-year contract, up from its previous offer of 9%, while GM’s latest offer is 18% and Stellantis’s offer is 17.5%. That’s compared to a wage increase of 40% — or 46% when compounded annually — that the union sought originally and later revised to 36%.

    “Their proposals don’t reflect the massive profits that we’ve generated for these companies,” Fain said.

    The union has pointed out that while the Big Three’s profit has risen 65% over the past four years, and the pay of each of the companies’ chief executives have risen 40%, the UAW top wage rate has risen 6% over that time.

    See: Why United Auto Workers are fighting to end a two-tier system for wages and benefits

    A GM spokesperson said Wednesday that the company continues to bargain in good faith and sent a statement that reads in part: “We are making progress in key areas that we believe are most important to our represented team members. This includes historic guaranteed annual wage increases, investments in our U.S. manufacturing plants to provide opportunities for all, and shortening the time for in-progression employees to reach maximum wages.”

    Ford and Stellantis did not immediately return a request for comment.

    The most recent U.S. autoworkers’ strike was at GM in 2019, which lasted for nearly six weeks and involved about 50,000 workers.

    See: Would a United Auto Workers strike provide an opportunity for Tesla — and push up used-car prices?

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  • UPS workers vote to approve ‘historic’ five-year contract

    UPS workers vote to approve ‘historic’ five-year contract

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    UPS employees approved a new five-year union contract with the delivery giant Tuesday, about a month after reaching a tentative deal that averted a strike of 340,000 United Parcel Services workers.

    The Teamsters said 86.3% of members voted for the “historic” deal, saying it was “the highest vote for a contract in the history of the Teamsters at UPS.”
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    “Teamsters have set a new standard and raised the bar for pay, benefits and working conditions in the package-delivery industry,” Teamsters General President Sean O’Brien said in a statement. “This is the template for how workers should be paid and protected nationwide, and nonunion companies like Amazon
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    better pay attention.”

    Among the parts of the contract the union highlighted were $2.75-an-hour raises for existing full- and part-time union members this year, and a total of a $7.50-an-hour raise over five years. All existing part-timers will earn at least $21 an hour starting immediately per the contract, according to the Teamsters.

    The union also noted that the pay increases for full-timers will keep UPS Teamsters as the highest-paid delivery drivers in the country, with the average top rate rising to $49 an hour. In addition, the Teamsters said the new contract ends what it called the two-tier wage system at the company, with all UPS Teamster drivers currently classified as “22.4s” — or hybrid drivers and warehouse workers who were paid less than full-time drivers — to be reclassified immediately as RPCDs, or regular package car drivers.

    A UPS spokesperson sent the following statement from the company: “Our Teamsters-represented employees have voted to overwhelmingly ratify a new five-year National Master Agreement that covers more than 300,000 full- and part-time UPS employees in the U.S.”

    Amazon did not immediately respond to a request for comment.

    One local supplemental agreement that affects 174 workers in Florida will be renegotiated, the union said. The national master agreement will go into effect as soon as that supplement, which is one of 44 local supplements, has been renegotiated and ratified, the union said.

    See: UPS blames ‘late and loud’ Teamsters talks for revenue miss, outlook cut

    Also: Actors, writers, hotel housekeepers and grad-student workers are all striking for the same reason

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  • How much would a strike cost the Big Three automakers? Wall Street thinks it has an answer.

    How much would a strike cost the Big Three automakers? Wall Street thinks it has an answer.

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    Wall Street got busy Monday calculating the impact of a strike on the Big Three automakers amid increasingly fraught labor negotiations between union workers and companies, and a  “greater likelihood” of a walkout next month.

    Also on Monday, President Joe Biden weighed in, urging the United Auto Workers and Ford Motor Co.
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    General Motors Co.
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    and Stellantis NV
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    to “to work together to forge a fair agreement.”

    Negotiations so far have been tense, and the contract expires in one month.

    Citi analyst Itay Michaeli estimated that a strike at GM lasting about two weeks impacting roughly about 100,000 vehicles would result in an impact of around $1.3 billion before interest and taxes; a five-week one, impacting about 280,000 vehicles, would result in a $3.4 billion impact EBIT. That would be a similar hit as GM’s 2019 strike, he said.

    Recent headlines are “pointing to increasingly challenging labor negotiations and a greater likelihood of a strike next month,” Michaeli said.

    A longer stoppage would result in shrinking dealer inventory and possibly start to impact sales sometime during the second half of October.

    For Ford, Michaeli calculated an impact of about $1.6 billion EBIT for a two-week strike affecting about 130,000 Ford vehicles, growing to $4 billion in the case of a five-week strike affecting 330,000 Ford cars and trucks. Like GM, sales would be hobbled roughly by mid-October in the case of a longer strike.

    “For both companies, the exact volume impact will in part depend on the extent of any Canada/Mexico downtime, and to that, GM appears somewhat better positioned than Ford due to GM’s higher exposure to Mexico production (including for pickup trucks) and other supply-chain considerations,” the analyst said in his note Monday.

    Both companies likely can keep their guidance intact in the case of a brief, one-week strike, but a strike beyond the two-week mark “likely triggers a [fiscal-year guidance] cut, though it would set 2024 up with reduced inventory and greater volume/price recovery prospects,” Michaeli said.

    A big question is whether a strike targets one specific automaker, as it was the case with GM in 2019, or all three at the same time — with more industry volume loss but also potentially a shorter strike, Michaeli said.

    “To that, Ford is generally viewed to be the least likely to be selected as a target,” he said.

    Deutsche Bank analyst Emmanuel Rosner said in his note Monday that he estimates an impact on earnings of about $400 million to $500 million for every week of production for each automaker, for a total of about $1.4 billion.

    GM’s 2019 strike lasted almost six weeks, with a loss of about $3.6 billion EBIT; GM North America lowered revenue estimates as nearly 300,000 fewer vehicles were delivered.

    Extrapolating the same $13,000 per unit in EBIT hit, Ford, GM and Stellantis could see [$550 million, $480 million, and $400 million] in weekly profit impact, reaching that $1.4 billion-a-week estimate, Rosner said.

    “In a bad-case scenario with 8 weeks of strike against all 3 automakers, which would bring the UAW strike fund to very low levels, this could cause $11.2 billion in lost profits for the [Detroit 3],” Rosner said. “While this is considerable, it would still be considerably less than the impact from the lifetime of the 4-year contract,” which would create “a permanent raise in the OEMs’ cost,” he said.

    The analyst also quantified the cost of UAW’s demands, focusing on the union’s “higher-probability asks” such as converting temporary employees into full-time workers, the elimination of a tiered-wage system, and about 40% base wage increase over the four years of the life of the contract. He left out “unlikely” to be met demands around pensions and post-retirement healthcare benefits.

    “Our analysis suggests accommodating these demands would likely constitute a large but not destructive headwind to OEMs’ earnings in year 1, with incremental costs stepping up even further in subsequent years,” Rosner said in the note.

    If these demands are granted with cost-of-living raises on top, Rosner estimated costs to all three automakers around $3.6 billion in the first year of the contract, amounting to $23 billion in total for the four years, “with highest hit to Stellantis, followed by GM and then Ford.”

    “Specifically, we estimate that the conversion of temporary employees to full-time workers would cost D3 a total of $1.4 billion, not yet factoring in wage increases, with the highest impact to Stellantis given the higher [percentage] of temporary employees used currently relative” to GM and Ford, the analyst said.

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  • Yellow Files for Bankruptcy. The Stock Is Down After Quadrupling.

    Yellow Files for Bankruptcy. The Stock Is Down After Quadrupling.

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    This copy is for your personal, non-commercial use only. To order presentation-ready copies for distribution to your colleagues, clients or customers visit http://www.djreprints.com.

    https://www.barrons.com/articles/yellow-stock-bankruptcy-9bd197f5

    • Order Reprints
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    Yellow


    one of the country’s largest and oldest trucking companies, has filed for bankruptcy amid mounting debt and a labor dispute with the Teamsters union.

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  • UPS, Teamsters reach tentative deal, averting threat of a strike

    UPS, Teamsters reach tentative deal, averting threat of a strike

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    Package-delivery giant United Parcel Service Inc. and the Teamsters union on Tuesday said they had reached a tentative five-year labor agreement that would boost jobs, pay and other protections, after increasingly vocal threats of a strike reignited concerns about the impact to the economy and the nation’s shipping ecosystem.

    Teamster locals in the U.S. and Puerto Rico will now meet on July 31 to review and recommend the tentative deal, which will cover 340,000 workers, the Teamsters said in a release. Rank-and-file members will vote on the deal starting on Aug. 3, with the voting process running until Aug. 22.

    Under the deal’s terms, current full and part-time UPS
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    workers in the Teamsters union will get $2.75 more per hour this year, and $7.50 more over the course of the contract, according to a release.

    Current part-timers would have their pay raised to at least $21 per hour immediately, with a 48% average total wage hike over the next five years. New part-time hires would start at $21 per hour and advance to $23 per hour, the Teamsters said.

    Full-time UPS delivery drivers in the Teamsters union would see their average top pay rate rise to $49 per hour.

    The deal also ends a two-tier wage system at UPS and makes Martin Luther King Day a holiday for union members. UPS will also outfit newer delivery vehicles with air conditioning and cargo ventilation. The deal also ends forced overtime on union members’ days off.

    Shares of UPS were up 0.8% in afternoon trade. Shares of rival FedEx Corp.
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    were up 0.5%.

    Talks between UPS and the union began in April. Some Wall Street analysts expected both sides to reach a deal, despite a more hardline stance from Teamster leadership.

    “Rank-and-file UPS Teamsters sacrificed everything to get this country through a pandemic and enabled UPS to reap record-setting profits,” Teamsters General President Sean O’Brien said in a statement.

    “Teamster labor moves America,” he continued. “The union went into this fight committed to winning for our members. We demanded the best contract in the history of UPS, and we got it. UPS has put $30 billion in new money on the table as a direct result of these negotiations.”

    UPS Chief Executive Carol Tome, in a separate statement, also praised the deal.

    “This agreement continues to reward UPS’s full- and part-time employees with industry-leading pay and benefits while retaining the flexibility we need to stay competitive, serve our customers and keep our business strong,” she said.

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  • UPS, Teamsters Reach Agreement on New Contract

    UPS, Teamsters Reach Agreement on New Contract

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    UPS, Teamsters Reach Agreement on New Contract

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  • Netflix’s password-sharing crackdown is imminent, but the writers’ strike may be causing a delay

    Netflix’s password-sharing crackdown is imminent, but the writers’ strike may be causing a delay

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    Netflix Inc. has teased the U.S. rollout of a password-sharing crackdown, but one analyst wonders if the ongoing writers’ strike is delaying the company’s plans.

    The streaming-media company has already started to clamp down on account sharing in other markets by limiting who can use accounts and charging more for additional access. JPMorgan’s Doug Anmuth wondered if Netflix
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    was rethinking a broader rollout at the moment, given the prospect of content interruptions.

    See more: Netflix delivers cliffhanger for investors as password-sharing crackdown is delayed

    “Paid sharing is effectively a price increase, w/paid members sharing their password receiving less value for the same price, or potentially paying more to add an extra member. And for borrowers who currently do not pay, paid sharing means either activating their own subscription or being added as an extra member, or losing access to NFLX,” he wrote in a note to clients.

    For that reason, “it’s possible that NFLX may not like the optics of implementing paid sharing while 11,500 WGA writers are on strike, w/production suspended or writing paused across at least a handful of NFLX titles including Stranger Things S5 & Emily in Paris S4, among others,” Anmuth continued.

    Netflix didn’t respond to a MarketWatch request for comment asking when paid sharing will roll out in the U.S., why it hasn’t rolled out yet, and if the delay was at all due to the writers’ strike.

    Opinion: Disney shows streaming wars are destroying all that was good about streaming

    The paid-sharing rollout is a critical element of Netflix’s financial story these days. Netflix estimates that some 100 million people were freeloading off of others’ paid Netflix subscribers, and Anmuth expected that Netflix would be able to get at least 30 million of those to start paying up, whether by becoming add-on members for existing accounts or new subscribers in their own right.

    For that reason, a continuation of the writers’ strike “could further postpone revenue & subscriber acceleration,” he wrote.

    See also: Streaming nirvana is about to become more expensive — and offer less content

    The writers’ strike also threatens to impact Netflix’s other hot initiative: its advertising tier. Anmuth noted that the company’s upfront presentation to advertisers, its first-ever, was turning into a prerecorded event, presumably because the company fears “heavy picketing and protesting” and “less availability of star talent.”

    “[U]ltimately, advertising is closely tied to paid sharing, w/borrowers likely viewing a $6.99 Standard w/Ads plan as a compelling low-priced option,” Anmuth wrote. “Therefore, ramp of the ad tier is also delayed if paid sharing is delayed.”

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  • Hollywood writers go on strike, saying they face ‘existential crisis’

    Hollywood writers go on strike, saying they face ‘existential crisis’

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    Hollywood writers are on strike for the first time in 15 years, halting production of TV shows and movies.

    The Writers Guild of America announced Monday night its boards unanimously approved a strike effective 12:01 a.m. Tuesday. “Picketing will begin tomorrow afternoon,” the WGA said in a tweet Monday night.

    The WGA said the decision was…

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  • Apple Makes Plans to Move Production Out of China

    Apple Makes Plans to Move Production Out of China

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    In recent weeks, Apple Inc. has accelerated plans to shift some of its production outside China, long the dominant country in the supply chain that built the world’s most valuable company, say people involved in the discussions. It is telling suppliers to plan more actively for assembling Apple products elsewhere in Asia, particularly India and Vietnam, they say, and looking to reduce dependence on Taiwanese assemblers led by Foxconn Technology Group. 

    Turmoil at a place called iPhone City helped propel Apple’s shift. At the giant city-within-a-city in Zhengzhou, China, as many as 300,000 workers work at a factory run by Foxconn to make iPhones and other Apple products. At one point, it alone made about 85% of the Pro lineup of iPhones, according to market-research firm Counterpoint Research. 

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  • Senate passes bill to prevent rail strike, rejects measure providing paid sick leave

    Senate passes bill to prevent rail strike, rejects measure providing paid sick leave

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    The U.S. Senate on Thursday voted 80-15 in favor of a bill that would prevent a rail strike by imposing a deal on freight-rail workers, after rejecting a separate House-passed measure that would require rail companies to provide those workers with seven days of paid sick leave per year.

    The vote for the bill imposing a deal keeps Washington on track to block a strike, as the House of Representatives passed it Wednesday. President Joe Biden is expected to sign the legislation into law given that he called on Monday for Congress to act.

    Business groups have been warning that even a short-term strike would have a tremendous impact and cause economic pain.

    The deal that would be imposed on rail employees includes a 24% increase in wages from 2020 through 2024, but workers have remained concerned about a lack of paid sick time.

    In the vote on sick leave, there were 52 senators in favor, while 43 were opposed, and 60 votes for it were needed. A half dozen Republican senators were in favor, while Sen. Joe Manchin of West Virginia was the only Democrat in opposition.

    “While I am sympathetic to the concerns union members have raised, I do not believe it is the role of Congress to renegotiate a collective bargaining agreement that has already been negotiated,” Manchin said in a statement. 

    Earlier Thursday, the Senate also voted against an amendment from Republican senators that aimed to deliver a cooling-off period so talks between rail companies and their workers could continue.

    Railroad operators’ stocks finished with gains Tuesday as traders reacted to Washington’s moves to prevent a strike, but Norfolk Southern Corp.
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     CSX Corp. 
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    and Union Pacific Corp.
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    all lost ground Thursday as the broad market
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    -0.09%

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    closed mostly lower.

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  • ‘A rail shutdown would devastate our economy’: Biden urges Congress to head off potential strike

    ‘A rail shutdown would devastate our economy’: Biden urges Congress to head off potential strike

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    OMAHA, Neb. — President Joe Biden on Monday asked Congress to intervene and block a railroad strike before next month’s deadline in the stalled contract talks, following pressure by business groups on the stalled negotiations.

    “Let me be clear: a rail shutdown would devastate our economy,” Biden said in a statement. “Without freight rail, many U.S. industries would shut down.”

    Congress has the power to impose contract terms on the workers, but it’s not clear what lawmakers might include if they do. They could also force the negotiations to continue into the new year.

    Both the unions and railroads have been lobbying Congress while contract talks continue. Four rail unions that represent more than half of the 115,000 workers in the industry have rejected the deals that Biden helped broker before the original strike deadline in September and are back at the table trying to work out new agreements. Eight other unions have approved their five-year deals with the railroads and are in the process of getting back pay for their workers for the 24% raises that are retroactive to 2020.

    Biden said that as a “a proud pro-labor president” he was reluctant to override the views of people who voted against the agreement. “But in this case — where the economic impact of a shutdown would hurt millions of other working people and families — I believe Congress must use its powers to adopt this deal.”

    Biden’s remarks came after a coalition of more than 400 business groups sent a letter to congressional leaders Monday urging them to step into the stalled talks because of fears about the devastating potential impact of a strike that could force many businesses to shut down if they can’t get the rail deliveries they need. Commuter railroads and Amtrak would also be affected in a strike because many of them use tracks owned by the freight railroads.

    The business groups led by the U.S. Chamber of Commerce, National Association of Manufacturers and National Retail Federation said even a short-term strike would have a tremendous impact and the economic pain would start to be felt even before the Dec. 9 strike deadline. They said the railroads would stop hauling hazardous chemicals, fertilizers and perishable goods up to a week beforehand to keep those products from being stranded somewhere along the tracks.

    “A potential rail strike only adds to the headwinds facing the U.S. economy,” the businesses wrote. “A rail stoppage would immediately lead to supply shortages and higher prices. The cessation of Amtrak and commuter rail services would disrupt up to 7 million travelers a day. Many businesses would see their sales disrupted right in the middle of the critical holiday shopping season.”

    A similar group of businesses sent another letter to Biden last month urging him to play a more active role in resolving the contract dispute.

    On Monday, the Association of American Railroads trade group praised Biden’s action.

    “No one benefits from a rail work stoppage — not our customers, not rail employees and not the American economy,” said AAR President and CEO Ian Jefferies. “Now is the appropriate time for Congress to pass legislation to implement the agreements already ratified by eight of the twelve unions.”

    Congressional leaders and the White House have said they are monitoring the contract talks closely but haven’t indicated when they might act or what they will do. House Majority Leader Steny Hoyer, D-Md., said leaders are aware of the situation with the rail negotiations and will monitor the talks in the coming days.

    Rep. Brian Fitzpatrick, R-Pa., said on “Fox News Sunday” that congressional intervention is a last resort but that lawmakers will have to be ready to act.

    “Congress will not let this strike happen. That’s for sure,” said Fitzpatrick, who helps lead a bipartisan group of 58 lawmakers. “It would be devastating to our economy. So, we’ll get to a resolution one way or another.”

    “It certainly could end up in Congress’ lap, which is why we are headed to D.C. this week to meet with lawmakers on the Hill from both parties,” said Clark Ballew, a spokesman for the Brotherhood of Maintenance of Way Employes Division, which represents track maintenance workers. “We have instructed our members to contact their federal lawmakers in the House and Senate for several weeks now.”

    The unions have asked the railroads to consider adding paid sick time to what they already offered to address some of workers’ quality of life concerns. But so far, the railroads, which include Union Pacific
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    Berkshire Hathaway’s
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    BNSF, Norfolk Southern
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    CSX
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    and Canadian Pacific’s
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    -1.26%
    Kansas City Southern, have refused to consider that.

    The railroads want any deal to closely follow the recommendations a special board of arbitrators that Biden appointed made this summer that called for the 24% raises and $5,000 in bonuses but didn’t resolve workers’ concerns about demanding schedules that make it hard to take a day off and other working conditions.

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