Potential Railroad Strike Averted

Brooke Phillips, CWCMS
Editor | Shield HealthCare
11/30/22  3:27 PM PST
Potential Railroad Strike 2022

Update: Good News!

Although Shield HealthCare has been taking proactive measures to mitigate service interruption to you, the potential railroad strike has been averted by congress. This means the risk of supply chain shortages from a strike have been avoided, and your orders will continue to be shipped on time.

What Happened: On November 30, 2022, the U.S. House of Representatives passed two measures to bypass a strike and ensure continuation of rail service. The first measure bars a strike and imposes the terms of the tentative contract negotiated among freight railroads and most of their unions in September; this tenative contract was ratified by 8 unions and rejected by 4. The second measure adds 7 sick days, or 56 hours, of paid sick leave to the contract terms.

On December 1, 2022, both measures moved to the U.S. Senate, which also passed the first measure, but the second measure adding sick leave failed to reach the necessary 60-vote threshhold and did not pass. This sent the first measure to the President’s desk. On December 2, 2022, President Biden signed the first measure into law and a strike was avoided.


Preparing for a Possible Shortage

You may have heard about a looming railroad strike in the news. See below for questions and answers on how this might affect you, and for information on what Shield is doing to protect your orders.

How will this affect you and your medical supplies?

Shield HealthCare is taking steps to minimize the impact this strike could have on you. We have increased our stock on hand and will continue to do everything we can to safeguard access to your medical supplies while railroad negotiations take place. We will keep you apprised of significant developments and look forward to a positive resolution.

Why is there a potential strike?

Twelve different unions representing approximately 115,000 railroad workers are negotiating with the Association for American Railroads for workplace improvements, including paid sick leave and attendance policy changes. A tentative deal was struck in September and recently ratified by 8 of the 12 unions. However, the deal fell short of offering paid sick leave, which is a sticking point for union workers who carried the railroads through the pandemic. Four railroad unions have decided that if a deal is not struck by December 8, they will strike. If any of the twelve unions strikes, no unions will cross the picket line and rail service in the United States will effectively shut down.

What products are affected?

Approximately 30% of the nation’s freight is moved by rail, including medical supplies, food, fuel, cars, equipment parts, and chemicals used in the production of all sorts of items. See infographic below.

Source: https://www.up.com/customers/track-record/tr120120-freight-rail-how-much-ships-by-rail.htm

 

Are any of my products shipped by rail?

Some of the products Shield HealthCare receives are shipped by rail and then delivered to Shield by truck from the freight yard. Even if your final product is not shipped by rail, some of the materials used in the development of your products likely travel by railroad. If the railroad unions go on prolonged strike, supply chain shortages are possible.

Will the U.S. Government prevent the strike?

The U.S. Government has the power to step in to ensure our railroads continue to run. If the federal government successfully steps in, a strike could be averted, but both branches of legislature – the House and the Senate – must approve of the measures. The President must also sign off on the measures for them to take effect.

As of November 30, 2022, a measure has passed the house that would require unions to work under the tentative contract agreement reached earlier this year. A separate measure providing sick days to railroad employees has also passed the house. Both measures now move to the Senate.

 

For more information, or for additional questions or concerns, call Shield HealthCare at 800.228.7150.

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