Wages of Railroad Labor

Report Outline
Railroad Freight Rates and Railroad Wages
Federal Railroad Labor Disputes Legislation
Principal Railroad Wage Changes Since 1917
Railroad Labor Disturbances Since 1917
Railroad Employment, Wages, and the Cost of Living
Railroads' Financial Position and Wage Reduction
Special Focus

Railroad Freight Rates and Railroad Wages

Forthcoming Decision in 15 Per Cent Rate Case

Hearings before the Interstate Commerce Commission on the petition of the railroads for a 15 per cent freight rate increase ended September 30, 1931. The commission is expected to announce its decision in the case before the end of October. The generally accepted opinion in Washington is that the carriers will not obtain the full rate advance requested and that they may even be granted no flat percentage increase. If this opinion proves to be correct, it is probable that the railroads will promptly initiate a movement for general reductions in the wages of their employees.

A small percentage increase of all freight rates or the authorization of specific rate advances would presumably be insufficient to cope with the financial emergency outlined by the railroads in their petition to the Interstate Commerce Commission. Other expenditures having already been sharply reduced, the assumption is that if the roads are not assured of an adequate increase in revenues, they will seek to solve their problem through savings on the wage bill. In fact, Daniel Willard, president of the Baltimore & Ohio, recently warned that the railroads “may be forced to seek wage reductions,” and on the final day of the commission hearings railroad attorneys predicted that denial of the petition would be followed by wage cuts throughout the country's transportation system.

Unless voluntary agreements could be reached between the carriers and their employees, any attempts to cut the compensation of railroad workers would result in a long struggle between the two parties. The machinery of the Railway Labor Act of 1926, providing for mediation and arbitration of railway labor disputes, would probably be brought into play. While there is the possibility of strike disturbances and a tie-up of the country's basic transportation system, that eventuality is more remote.