Rail unions seek to protect benefits from spending cuts

A photograph of two train locomotives. There are two men standing in front of each train.

U.S. railroad unions want federal lawmakers to remove the unemployment and sickness benefits of the Railroad Unemployment Insurance Act (RUIA) from the list of government programs subject to automatic spending cuts.

The unions have pressed the two U.S. Senators from Ohio, Rob Portman (R) and Sherrod Brown (D), to co-sponsor language within the HEROES Act (H.R. 6800) that would amend the Balanced Budget and Emergency Deficit Control Act of 1985 so that RUIA benefits would be among government programs not subject to sequestration, or automatic spending cuts. Senator Portman is chair of the Senate subcommittee on social security, pensions and family, and the subcommittee would be responsible for decisions on benefit-related sequestration, according to the unions. 

The unions involved include the Teamsters Rail Conference and the AFL-CIO Transportation Trades Department (TTD). The HEROES Act is an emergency supplemental appropriations bill that serves as the federal government’s response to the COVID-19 pandemic.

Unlike others who receive unemployment benefits through state-administered unemployment insurance programs, railroad workers receive benefits through the RUIA program, which is administered by the United State Railroad Retirement Board, according to the Teamsters Rail Conference. The railroads fund the unemployment benefits, and so eliminating the RUIA program from sequestration doesn’t have any effect on the U.S. deficit or the U.S. budget, the unions said.

As a result of the RUIA being subject to sequestration per the Budget Control Act of 2011, unemployment and sickness benefits have been sequestered or reduced since 2013 because they were part of a package of spending cuts, the unions said. 

“In these uncertain times, our members who are either laid-off or sick deserve the same fair treatment as all other workers across the country, who receive 100% of the unemployment benefits to which they are entitled by law. For these reasons, it is critical that the sequestration of RUIA be rescinded,” stated a June 11 letter to the senators from Teamsters Rail Conference President Dennis R. Pierce and AFL-CIO TTD President Larry Willis. 

According to the letter, RUIA unemployment and sickness benefits are being sequestered or cut at a rate of 5.9%, although rates are adjusted annually when the federal sequestration is recalculated and rates have been as high as 9.2% in the past. The rate will remain at 5.7% because the requirement to recalculate expires in 2021, but sequestration will continue through FY2030 pursuant to the CARES Act.

Separately, the issue of seeking to remove RUIA unemployment and sickness benefits from being subject to sequestration was also on a wish list of items that the Association of American Railroads wanted Congress and the White House to address in a transportation infrastructure bill.

(Click here for more FreightWaves aricles by Joanna Marsh)