U.S. railroad investor resolutions urge paid sick leave for workers By Reuters

By Ross Kerber

(Reuters) – Investors have proposed shareholder resolutions at two U.S. railroads calling for paid sick leave for workers, an issue that nearly caused a national rail strike, and they could go to an advisory vote at shareholder meetings in the spring.

On Friday President Joe Biden signed legislation to block a rail shutdown that could have devastated the American economy. But the deal he approved did not include paid sick days for workers, a key sticking point for unions in contract talks with five major U.S. railroads.

Proposals seen by Reuters filed by activist investors ask Norfolk Southern Corp (NYSE:) and Union Pacific Corp (NYSE:) to offer “a reasonable amount” of paid sick time, determined by company directors. If accepted each resolution would appear as a ballot item at the railroads’ springtime shareholder meetings.

Kate Monahan, a director at Trillium Asset Management, the socially minded investor that filed the resolution at Union Pacific, said more flexible sick time would have broader benefits like reducing workforce turnover.

“There’s a clear business case that makes sense to us as investors,” she said.

A Union Pacific representative did not comment on the resolution, but referred to a trade group statement that industry employees already receive substantial time and leave for longer-term illnesses.

A Norfolk Southern representative declined to comment.

Resolutions about worker welfare have drawn more support at corporate annual meetings in recent years amid the COVID-19 pandemic. Voting on the resolutions would not be binding.

Railroads worry implementing paid sick leave would require more employees at a time when many have cut their workforces dramatically. Had sick time been included in recent federal legislation it would cut U.S. rail earnings 1.5% to 2%, Susquehanna analyst Bascome Majors wrote in a Nov. 30 investor note.