Supply Chains at Risk Again with Rail Labor Dispute

Leading retailers have navigated an incredible set of circumstances over the last several years, particularly with regard to supply chain challenges. Bottlenecks at the ports, labor shortages, unprecedented spikes in consumer demand, and more have put retailers to the test. Now, as negotiations remain ongoing for the master labor contract at our West Coast ports, more labor challenges are on the horizon.

It's been over a month since the National Mediation Board (NMB) ended the mediation process between the Class I freight railroads and major rail unions representing 115,000 employees. Avoiding disruption while balancing the needs of rail companies and their employees is critical.
Freight rail in America accounts for around 40% of long-distance freight volume—more than any other mode of transportation.  A strike at this juncture would be devastating to the rail industry and to the millions of American retailers and other businesses that depend on rail. It is vital these negotiations conclude without any interruption to rail service—especially as the retail industry heads into the critical “peak season” of moving goods for back-to-school and holidays.

That’s why we are urging the Biden administration to take action to ensure there is no interruption to the country’s rail service. The White House is expected to appoint a Presidential Emergency Board (PEB) of 3-5 members, which then has 30 days to conduct hearings and issue settlement recommendations. In a letter to the White House this week, we ask the president and vice president to appoint members to the PEB that will help fairly and expeditiously address this important issue.

In addition to the rail labor challenge, California's AB5 law, which restructured the classification of independent contractors, is poised to pose additional strain on supply chains operating in the state. This is another issue the RILA team is monitoring closely and will  keep RILA members apprised of any developments.

For more information please contact RILA Vice President of Supply Chain Jess Dankert or Vice President of Workforce Evan Armstrong.
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