Biden steps in to help end disputes between freight railroads and union contracts

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WASHINGTON, July 15 (Reuters) – U.S. President Joe Biden on Friday signed an executive order creating an emergency board to help resolve disputes between major freight rail carriers and their unions, which could help ease some of the constraints of the supply chain.

The order came ahead of a deadline next week to intervene in nationwide U.S. railroad labor negotiations covering 115,000 workers, or open the door to a potential strike or lockout that could threaten an economy already fragile and stifle the supply of food and fuel. Read more

Had the president not created the Presidential Emergency Council (PEB) by 12:01 a.m. EDT Monday, the railroads and unions could have opted for operational shutdowns or strikes, respectively. The order goes into effect Monday.

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The council “will provide a structure for workers and management to resolve their disagreements. The council will investigate the dispute and, within 30 days of its establishment, deliver a report recommending how the dispute should be resolved,” the House said. White.

Talks between major freight railroads, including Union Pacific (UNP.N) and Berkshire Hathaway-owned BNSF (BRKa.N), and unions representing their workers have lasted more than two years.

The order triggers a “cooling off” period so that both parties can work out a settlement.

“We look forward to the next recommendations from the president-appointed arbitrators,” said Greg Regan, chairman of the AFL-CIO’s transportation trades department, which represents several railroad unions.

In letters to Biden, U.S. business groups representing retailers as well as food and fuel producers warned that failure to name a PEB would be “disastrous” for the slowing economy.

The railroads move everything from Amazon parcels to fuel oil and soybeans, and a shutdown of any kind could drive up the prices of basic necessities and disrupt supply chains.

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Reporting by Chris Sanders and Lisa Baertlein; Editing by Chizu Nomiyama, Marguerita Choy and Sandra Maler

Our standards: The Thomson Reuters Trust Principles.

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