Meanwhile, two major rail unions are set to vote on ratifying the deal on Nov. 21: The Brotherhood of Locomotive Engineers and Trainmen, and the Smart Transportation Division.
"With this extension, BLET and SMART-TD will have the opportunity to finish their ratification procedures for any tentative national agreements without disruption. If these Unions do not ratify, then we will have the opportunity to bring all of Rail Labor together, under a single deadline, to finish national negotiations," the BMWED stated.
A labor spokesperson explained to CNBC if the BLET or SMART-TD does not ratify, the ending of the new cooling-off period date would be December 8. That means the earliest a possible strike would happen is December 9.
Freight industry trade group The Association of American Railroads, said in a
release that this extension provides greater certainty for the economy, rail customers, and rail passengers planning to travel for the Thanksgiving holiday. The rail industry has previously estimated the cost to the economy of a rail strike at $2 billion per day.
"This agreement to extend the cooling off period affords all unionized employees the opportunity to vote on their agreements free of a looming strike threat," said AAR President and CEO Ian Jefferies in the statement. "Our goal remains the same – successfully completing this round of bargaining – and we stand ready to reach an agreement with BMWED based upon the Presidential Emergency Board's recommendations."
Union Pacific,
Berkshire Hathaway's BNSF,
CSX,
Norfolk Southern and the U.S. railroads owned by
Canadian National are among the Class I freight railroads represented by the AAR.
Industries across the U.S. economy are voicing their concerns. The National Association of Manufacturers posted on its
website concerns about the impact of a railroad strike a segment of the economy still facing supply chain challenges.
"Manufacturers are encouraged to see that all the unions have now agreed to extend the deadline for reaching and ratifying an agreement," Jay Timmons, CEO of National Association of Manufacturers, told CNBC. "It provides some temporary breathing room for operational and logistical planning for manufacturers and delays any rail service interruptions. We hope that this extension will provide the additional time necessary for all parties to conclude a voluntary agreement, as has been our hope throughout. Any disruption to rail service would have devastating economic and inflationary effects, so in line with [U.S. Department of Labor] Secretary [Marty] Walsh's comments yesterday, we continue urging congressional leaders to be prepared to act should a work stoppage appear imminent."
Last Thursday, a group of nearly 200 agricultural trade groups known as the Agricultural Transportation Working Group and including the National Grain & Feed Association,
sent a letter to Congress stating that a "strike or lockout combined with existing challenges in the rail system, at our ports, with trucking and with record low water levels on the Mississippi River impacting numerous barge shipments would be catastrophic for the agricultural and broader U.S. economies."
"We are pleased to see the extension of the status quo from the union today," Jonathan Gold, National Retail Federation Vice President of Supply Chain and Customs Policy, told CNBC . "We encourage the parties to remain at the table and resolve the outstanding issues and avoid a strike that would impact the entire supply chain and harm the economy."
The BMWED was the
first rail union to vote against ratification of a labor agreement negotiated in conjunction with Biden's PEB. All 12 labor unions must ratify a labor agreement to avoid the potential for a nationwide rail shutdown.