The Railway Labor Act and Presidential Emergency Boards

Railway Labor Act Overview
The Railway Labor Act of 1926 (RLA) was passed to ensure that labor disputes within the railroad industry were handled with the least disruption possible to interstate commerce activities. In 1936, the RLA was expanded to include the emerging airline industry within its jurisdiction. The National Mediation Board (NMB), an independent federal agency, was created by a 1934 amendment to the RLA to enforce the RLA and to provide oversight and support to its covered parties.

Creation of a Presidential Emergency Board
The RLA provides that if the NMB finds that an unresolved dispute between a carrier and a labor organization or other representative threatens “substantially to interrupt interstate commerce to a degree such as to deprive any section of the country of essential transportation service,” the NMB is to notify the President of the United States. Upon such notification, the President may, in his discretion, create an emergency board to investigate the dispute and issue a report and recommendations.

Composition and Function of the Presidential Emergency Board
Pursuant to the RLA, the emergency board is to be comprised of any number of individuals chosen by the President. The board may not, however, include members with a monetary interest in the carriers or the labor organizations involved. Typically, professional arbitrators with vast experience are selected to be members of a presidential emergency board. The board typically has 30 days within which to complete its investigation and issue a report.

Post-Emergency Board Activities
After the creation of the board and for 30 days after the board issues its report or recommendations (a so-called “cooling off” period), parties to the dispute are required by the RLA to maintain the status quo.

If parties to a dispute have not reached an agreement within 60 days after the creation of the board, the NMB convenes a public hearing. At the hearing, parties to the dispute are required to appear and explain why they have not accepted the proposals and recommendations of the emergency board.

If no resolution is reached within this period of time, parties to the dispute are generally free to engage in self-help activities, such as strikes and lockouts.

Second Emergency Board
Once 120 days has passed from the creation of the first emergency board and no settlement has been reached by the parties, the RLA entitles any party to the dispute or the Governor of any State through which the affected service passes to ask the President to convene a second emergency board. Within 30 days of the creation of a second board, the parties are required to submit their final offers of settlement to the board. Within 30 days of receiving such offers, the board informs the President as to which offer it finds most reasonable.

If the board selects the employees’ offer as the most reasonable and if the carrier refuses to accept that offer, the employees may strike. In such a case, the carrier will not be entitled to participate in any benefits of any agreements between carriers designed to assist carriers during a strike.