Norfolk Southern and BNSF late Friday said they had, in partnership, reached tentative, five-year collective bargaining agreements with a number of their unions.

The railroad pacts come four months before the opening of the next bargaining round and cover approximately 30% of the unionized NS (NASDAQ: NSC) workforce and 15% of BNSF (workers.

The early deals are yet another sign of labors’ growing bargaining strength as railroads and other employers struggle to fill out their workforces following the Covid pandemic.

Unions reaching agreement with NS are the Brotherhood of Railway Carmen Division/TCU (BRC); the International Association of Sheet Metal, Air, Rail and Transportation Workers – Mechanical Department (SMART-MD); Transportation Communications Union/IAM (TCU), as well as multiple General Committees for the International Association of Sheet Metal, Air, Rail and Transportation Workers – Transportation Division (SMART-TD).

BNSF Railway agreed on contracts with the BRC, SMART-MD and TCU, as well as the American Train Dispatchers Association (ATDA).

The agreements must still be ratified by union members; no immediate timeframe was provided.

Both NS and BNSF in announcing the agreements said they give employees “unprecedented certainty about upcoming enhancements to their pay, health care, and vacation”.

The new contracts provide a 3.5-percent average wage increase per year over the next five years. They also offer railroaders more vacation earlier in their career and what the railroad said were “meaningful enhancements” to healthcare benefits.

“Our craft railroaders are the heart and soul of Norfolk Southern, and we are committed to supporting our colleagues who power our network every day,” said Alan Shaw, Norfolk Southern president and chief executive, in the statement. “I want to thank the labor leaders who share our commitment to our craft colleagues and helped us reach this deal early, ensuring peace of mind with clear knowledge about upcoming pay, healthcare and vacation improvements. We look forward to reaching similar agreements with the rest of the unions at Norfolk Southern.”

“We recognize that we are successful in meeting our customers’ expectations because of the men and women of BNSF,” said BNSF President and Chief Executive Katie Farmer. “I appreciate and want to thank the labor leaders who have collaborated with us to secure these tentative agreements in advance of the upcoming bargaining round. These agreements prioritize the well-being of our employees by not making them wait years for a pay raise, while, at the same time, ensuring our ability to continue providing industry-leading service for our customers.”

Union leaders in the announcement hailed the agreements, saying they are a step in the right direction while emphasizing they include paid time off —  a benefit that railroads have largely resisted giving in the past.

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