Deadlocked rail talks could pose threat to peak retail season

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FILE – This April 2, 2021, file photo shows freight train cars and containers at Norfolk Southern Railroad’s Conway Yard in Conway, Pa. On Tuesday, June 14, 2022, the National Mediation Board decided that mediation isn’t working in the joint talks that cover roughly 140,000 workers in 13 unions at the biggest freight railroads that deliver the raw materials many companies rely upon and the cars, chemicals and containers full of consumer goods they make. (AP Photo/Gene J. Puskar, File)

(NewsNation) — The National Retail Federation is urging President Joe Biden to take action before stalled freight rail negotiations disrupt the supply chain during peak shipping season and lead to more consumer headaches.

Contract talks for railroad workers remain deadlocked after more than two years of negotiations. In a letter sent to Biden on Wednesday, the National Retail Federation urged the administration to encourage the parties to come back to the table to reach an agreement.

The federation hopes that will stave off the “potential for system-wide disruption in September.” That includes empty shelves and rising prices as retailers try to offset the cost of inflation, said Jonathan Gold, NRF’s vice president for supply chain and customs policy.

“We’re actually in the peak shipping season now, which is when retailers bring in their merchandise for back-to-school, for holiday shopping,” Gold said. “That typically runs from June through November. A lot of retailers have moved up their shipments. Part of the reason is because of the ongoing labor negotiations.”

Despite inflation and pandemic-related supply chain issues, retail sales have been on the rise and they’re expected to be up between 6% and 8% in 2022, according to the NRF.

“To have any kind of action that would shut down a transportation mode would make that extremely difficult for retailers to continue to meet that demand,” Gold said.

The National Mediation Board determined in June that mediation wasn’t working in the joint talks that cover roughly 140,000 workers in 13 unions at the biggest freight railroads. They deliver the raw materials many companies rely upon, as well as the cars, chemicals and containers full of consumer goods the companies make.

Biden is expected to appoint a Presidential Emergency Board to investigate why the two sides haven’t been able to reach a deal and make recommendations.

In the absence of an agreement, Congress could intervene in the current bargaining round to prevent supply chain disruptions, according to the National Railway Labor Conference.

The NRLC’s National Carriers’ Conference Committee represents the railroads in bargaining.

“The railroads have worked to address issues raised by both sides in the negotiations and have offered pay increases that are consistent with labor market benchmarks and reward rail employees for their essential work,” the NCCC said in an official statement issued last month.

The Coordinated Bargaining Coalition is one the two involved union coalitions representing a total of 115,000 employees. In its own June statement, CBC called the carriers’ proposals “an insult to our collective membership.”

Jeremy Ferguson, president of transportation for the railway worker union coalition SMART-TD, said in a statement Friday that he wants to “keep freight moving” and “support this country’s supply chain and economy.”

“Let me be clear, rail labor is not looking to strike or shut down the nation’s economy at the expense of everyone,” Ferguson said. “We want and deserve a fair agreement for our members.”

The Associated Press contributed to this report.

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