By Joel Penhorwood, Ohio Ag Net and Ohio’s Country Journal
A possible railroad worker strike starting Friday has been avoided after reports of a tentative agreement reached Thursday morning.
“Well, fortunately, this morning, there was an announcement that the two parties came to a tentative agreement for the this new 5-year contract for railroad workers,” said Mike Steenhoek, executive director of the Soy Transportation Coalition in a conversation with Ohio Ag Net and Ohio’s Country Journal. “And what that does, importantly, is that it prevents this potential strike at 12:01 Eastern Time on Friday. And so that’s a real sigh of relief to have that that resolution.”
Steenhoek reports the tentative agreement will provide rail employees a 24% wage increase during the 5-year period of the contract (2020-2024) — consistent with the recommendations of the Presidential Emergency Board. Steenhoek said an immediate average payout of $11,000 will be provided upon ratification.
Negotiations truly came down to the wire. Throughout this past week, railroads had increasingly been dialing down and suspending service due to the potential for a network stoppage starting on Friday.
“It was very much a lot of questions about who was going to blink first,” he said. “And obviously, when you get closer and closer to the deadline, pressure builds, and hopefully that will serve to shake loose fixed positions and make people more willing to negotiate. Clearly, from our perspective, we wouldn’t have had to walk up to this precipice that’s clearly not good for our economy, not good for agriculture, to have that kind of uncertainty, weighing on our industry, particularly with all of the supply chain challenges we’ve been experiencing and living with over the last couple of years.”
Though an agreement has been made, Steenhoek said it does not mean the work is over with the membership of all the unions still needing to ratify.
“That vote is expected over the next several weeks. I expect that to occur, even though there’s still some of the rank-and-file members not pleased with the tentative agreement, some of the terms of it. I do expect the agreement to be to be ratified. And yeah, that’s just really important because 30% of U.S. soybean exports utilize rail to get to our port regions. You really can’t have a successful agricultural sector, you really can’t have profitable farmers, unless you have a functioning reliable freight rail system. It is just too important to our industry,” he said.
A train has the freight capacity equal to about 400 semi-trucks. Steenhoek said a strike would have meant major implications for the agriculture sector, especially at this time of year.
“We’ve got harvest coming up, and we’ve got a lot of riding on the shoulders of the American farmer. There’s a lot of global food and insecurity,” Steenhoek said. “Farmers are willing to step up to the plate in producing a crop. We need a freight rail system that can help deliver that crop. So we’re very glad for this agreement that has occurred.”
Listen to the full conversation between Steenhoek and Ohio Ag Net’s Joel Penhorwood in the audio player above.