The Senate moved quickly on Thursday to avert a rail strike that the Biden administration and business leaders warned would have had devastating consequences for the nation’s economy.

The Senate passed a bill to bind rail companies and workers to a proposed settlement that was reached between the rail companies and union leaders in September. That settlement had been rejected by some of the 12 unions involved, creating the possibility of a strike beginning 9 December.

The Senate vote was 80-15. It came one day after the House voted to impose the agreement. The measure now goes to Joe Biden’s desk for his signature.

“I’m very glad that the two sides got together to avoid a shutdown, which would have been devastating for the American people, to the American economy and so many workers across the country,” the Democratic majority leader, Chuck Schumer, told reporters.

Schumer spoke as the labor secretary, Marty Walsh, and transport secretary, Pete Buttigieg, emphasized to Democratic senators that rail companies would begin shutting down operations well before a potential strike would begin. The administration wanted the bill on Biden’s desk by the weekend.

Shortly before Thursday’s votes, Biden – who had urged Congress to intervene earlier this week – defended the contract that four of the unions had rejected, noting the wage increases it contains.

“I negotiated a contract no one else could negotiate,” Biden said at a news briefing with Emmanuel Macron, the French president. “What was negotiated was so much better than anything they ever had.”

Critics say the contract that did not receive backing from enough union members lacked sufficient levels of paid leave for rail workers. Biden said he wanted paid leave for “everybody” so that it wouldn’t have to be negotiated in employment contracts, but Republican lawmakers have blocked measures to require time off work for medical and family reasons.

The US president said that Congress should now impose the contract to avoid a strike that Biden said could cause 750,000 job losses and a recession.

Senators also voted on Thursday on a measure, passed in the House on Wednesday along party lines, that would provide seven days of paid sick leave to railroad workers.

It fell eight votes short of a 60-vote threshold needed for passage in the Senate.

The rail companies and unions have been engaged in high-stakes negotiations. The Biden administration helped broker deals in September but four of the unions rejected them. Eight others approved five-year deals and are getting back pay for their workers for 24% raises retroactive to 2020.

The unions maintain that railroads can easily afford to add paid sick time when they are recording record profits. Several of the big railroads involved in these contract talks reported more than $1bn profit in the third quarter.