Senate passes rail labor agreement ahead of strike, sends to Biden

The Senate passed legislation that would force a tentative rail labor agreement and thwart a national strike.

A separate vote on adding seven days of paid sick leave to the agreement failed.

The approved bill, passed by a vote of 80 to 15, now goes to President Joe Biden, who had urged Congress to act quickly ahead of this month’s strike deadline and “send a bill to my desk for my signature immediately.” The measures come after talks had stalled between railways and four unions, which had previously rejected the agreement.

Biden has said he was reluctant to override the vote against the contract by some unions but that a rail shutdown would “devastate” the economy. Labor groups have said that enforcing an agreement with the legislation denies them the right to strike.

In a statement after the Senate vote, Biden said he would sign the bill into law “as soon as Congress sends it to my desk.”

“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,” Biden said in the statement.

The legislation, which was approved by the House on Wednesday, enacts new contracts providing railroad workers with 24% pay increases over five years from 2020 through 2024, immediate payouts averaging $11,000 upon ratification and an extra paid day off.

The House on Wednesday approved a separate measure that would have added seven days of paid sick leave to the contract instead of just one. That measure was defeated in the Senate vote. Paid sick leave has been the main point of disagreement during negotiations between railroads and the unions.

Jeremy Ferguson, president of SMART-TD, told CNBC there’s growing concern that some rail workers will quit after receiving their backpay without guaranteed paid sick time.

“I keep hearing that some are going to do that. It’s always a possibility,” he said. “I hope that doesn’t happen. I want every member to stay employed and enjoy all the benefits that we do have and we are going to need more employees if we’re going to have adequate time off.”

The parties had until Dec. 9 to reach an agreement before workers promised to strike, which the industry estimated would cost the U.S. economy $2 billion per day. Without an agreement, rail movement of certain goods was set to be curtailed as soon as this weekend in preparation for a strike.