One of the largest rail unions in the country voted against a proposed labor deal on Monday, raising the possibility of a nationwide rail strike just weeks before Christmas.

SMART Transportation Division, which represents nearly 30% of railroad workers, voted against a deal that would have staved off a potential December strike. The Brotherhood of Locomotive Engineers and Trainmen, the nation's second-largest union, voted to ratify the deal that addressed many workers' main concern — work-life benefits.

The deadline for all sides to reach an agreement will now move to Dec. 9, the last day before a strike could be avoided. Union officials have stated they would honor any established picket line, standing in solidarity despite voting differences.

The possibility of congressional intervention remains real. Lawmakers could act to implement a cooling-off period that would allow room for further negotiations, or make the unpopular decision of forcing workers to accept an agreement to protect the economy.

According to a Politico report, Republicans are "ready to impose recommendations made in August by a board appointed by President Joe Biden that didn't go as far to improve working conditions as the unions wanted." This would mean any gains made by unions since August would be erased, vaulting them back in leverage.

Negotiations between rail unions, management, and the government have lasted months, with the Biden administration offering several deals for workers to consider. In September, Biden and Labor Secretary Marty Walsh introduced a deal that would address wage concerns for workers, agreed upon by both union and railroad leaders.

The proposal, which must be voted on by union members, has fractured the united front presented by the labor organizations. Three unions comprising about 25% of the coalition voted the agreement down and seven smaller groups voted to ratify the deal, leaving the two largest unions to decide the future of the organizing efforts.

The effects of a late-year nationwide rail strike would have major economic implications. Already weakened supply chains would face increased uncertainty, eventually leading to a shortage of many essential chemicals and products.

The American Chemistry Council, which represents many of the major U.S. oil and gas companies, told CNBC that a rail strike would impact approximately $2.8 billion in chemical cargo a week, and lead to a decline in GDP and renewed inflation. Fears of a recession makes a rail strike starkly more undesirable for all sides.

Congress is set to return from Thanksgiving recess on Nov. 29, leaving less than a week for legislative action before the scheduled Dec. 9 beginning of the strike.

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