Union negotiators claimed the SRA had told Arriva Trains North any pay offer over average earnings would not be authorised as the deadlocked dispute looked set to drag on for much of the year.
An estimated 1,000 conductors, station and ticket staff started another 48 hour strike yesterday which caused chaos on local routes in the north of England.
Steve Coe, York based negotiator for the TSSA white collar rail union, said the company had admitted during discussions that its room for manoeuvre was limited.
"We are almost having to negotiate with the SRA via the company because the SRA have the veto over any deal and are, if you like, the organ grinders but they are not sitting at the table," he said.
Arriva denied its hands were tied but the SRA confirmed that it had the power to stop any offer significantly over average earnings, currently 3.9%, within the last 12 months of a franchise.
The Arriva franchise must be renewed by next February and a company offer of 4% to guards has already been rejected while ticket staff have yet to receive an offer involving restructuring of pay and working conditions. "We expect that any deal will be in line with the franchise agreement," said an SRA spokesman.
Arriva drivers recently received 18% but that was waved through under an SRA clause permitting big rises in exceptional circumstances, in this case a shortage of drivers.
Arriva admitted the dispute was "intolerable" to passengers though it claimed more than 55% of services would run today as union chiefs insisted the the company was talking "complete rubbish" and predicted only 25% would operate.
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