Threats of Rail Labor Strike Curtail HazMat Shipments

The possibility of an imminent rail labor strike has created uncertainties for rail shippers and receivers, of course for the railroads themselves, this autumn.  Shippers of hazardous materials (HazMat) have been particularly affected by preemptive measures taken by carriers to limit their exposure to risks of HazMat being delayed in transit on the rail network.  These include curtailing shipments of chlorine and other HazMat, suspending freight train service, and repositioning locomotives, as reported by the Association of American Railroads and the online service advisories of various Class I railroads.

There are twelve unions at the bargaining table.  Most of Class I railroads, together with a host of smaller railroads, are represented by the National Carriers Conference Committee.  Canadian Pacific Railway is negotiating directly with the unions.  As reported today (October 24, 2022) in Politico, so far, six unions, representing less than 20 percent of the freight rail workforce, have ratified their contracts.  Five contracts remain outstanding, subject to member vote.  This Wednesday, October 26, the Brotherhood of Railroad Signalmen is slated to announce ratification vote results.  The Brotherhood has approximately 7,300 members, representing about 6% of the rail labor workforce.  The other four unions with tentative agreements pending member ratification are expected to announce vote results after Election Day.  The membership of one union, the Brotherhood of Maintenance of Way Employees, voted theirs down, sending leadership back to the negotiation table, where the main items of contention are benefits and time-off policies, not pay.  (Note: The membership of District 19 also voted down its initial agreement on September 14, but its leadership has negotiated a revised agreement, which will be subject to a member vote on November 5). 

Needless to say, a rail strike heading into the holiday shopping season would almost certainly exacerbate supply chain disruptions and drive up the prices of goods at a time when inflation is already at historic highs.  A greater concern, however, is that ongoing curtailment of HazMat shipments could pose threats to energy security and public health.

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