Workers at Canada’s largest rail company threaten to strike

CN and Canadian Pacific Kansas City Ltd. locked out workers Thursday as negotiations for a new labor contract reached a deadline without an agreement. It brought rail freight to a near-total halt in the country for more than a day until Canadian National resumed service Friday morning. Trains operated by CPKC remain parked and its workers, who were already on strike since Thursday, remained on the picket line on Friday.

The government forced the companies and the union, the Teamsters Canada Rail Conference, to accept arbitration overseen by the Canada Industrial Relations Board — an order the union is contesting. Friday’s nine-hour hearing ended without an order from the board.

The union filed a 72-hour strike notice against CN on Friday morning, shortly after announcing plans to challenge the arbitration order, union spokesman Marc-André Gauthier said.

If the board orders the union back to work, “TCRC will legally abide by the decision, but will take steps to appeal to the fullest extent,” the Teamsters said in a statement. “Unfortunately, this will not provide immediate relief, but the Union is prepared to appeal to federal court if necessary.”

“We do not believe that any of the issues we have discussed in recent days are insurmountable, and we remain available to talk to resolve this issue without another work stoppage,” the union said in the letter to CN management.

Canadian National, which has about 6,500 workers involved in the dispute, said the impact of the strike announcement will depend on the timing of the CIRB’s decision. “It is in Canada’s national interest that the CIRB rule quickly, before further harm is caused,” the railway said in a written statement. CPKC has approximately 3,000 engineers, conductors and dispatchers involved.

Perrin Beatty, president and CEO of the Canadian Chamber of Commerce, said the union’s latest actions “will prolong the damage to our economy and endanger the well-being and livelihoods of Canadians, including union and non-union workers across multiple industries “.

Labor Minister Steven MacKinnon announced the decision to force the parties into binding arbitration on Thursday afternoon, more than 16 hours after the standoff shut down the railways, saying the economic risk was too great to allow them to continue. The government refused to order the arbitration two weeks ago. Mackinnon said he hoped negotiations between the companies and the union on a new contract would be successful. A spokesman for MacKinnon declined to comment on the strike notice Friday.

“It is not about disobeying the minister’s order. This is about exercising our right,” Teamsters Canada president Francois Laporte said Friday in announcing the strike. “We will exercise our right within the legal framework.”

Canadian National trains began running at 7 a.m. across Canada, CN spokesman Jonathan Abecassis said. The development initially appeared to end, at least in part, a work stoppage that threatened to wreak havoc on the economies of Canada and the United States. Both countries, in all industries, rely on railways to deliver their raw materials and finished products.

“While CN is focused on its recovery plan and fueling the economy, the Teamsters are focused on returning to the picket line and holding the North American economy hostage to their demands,” Abecassis said following the strike notice by the union.

The resumption of one of the railways is a relief for business. In most past labor disputes, only one of Canada’s railways shut down, and the economy was able to cope with the disruption.

Negotiations that began last year are stalled over issues related to how workers are scheduled and contract rules designed to prevent fatigue. The railroads proposed switching from the current system that pays workers based on the number of miles they travel to a system based on hours worked. The railways said the change would make it easier to deliver predictable schedules. But the union resisted because it feared the proposed changes would erode hard-fought protections against fatigue and jeopardize safety.

Similar quality-of-life concerns over demanding schedules and a lack of paid medical time drove U.S. railroads to the brink of a strike two years ago before Congress and President Joe Biden stepped in and forced workers to accept a deal.

In Canada, another issue at CN is the railroad’s intention to expand a system that would allow it to temporarily move workers to other parts of its network when it has no employees in a particular region.

As for wages, the railroads said both offered raises in line with other recent industry offers for already high-paying jobs. Canadian National said its engineers earn about $150,000 and conductors earn about $121,000 for working 160 days a year, although some of their free time is spent stuck at hotels on the road between train trips in while they rest. CPKC says its salary is comparable.

Almost all of Canada’s rail traffic – worth more than C$1 billion ($730 million) a day and totaling more than 375 million tonnes of freight last year – came to a halt on Thursday, along with rail shipments crossing the border with US. A number of smaller, short-line freight railroads handling local deliveries continued to operate, but failed to turn over shipments to any of the major railroads while idle.

About 30,000 Canadian commuters were also affected as their trains use CPKC lines. CPKC and CN trains continued to operate in the US and Mexico during the shutdown.

Billions of dollars of freight moves between Canada and the U.S. by rail each month, according to the U.S. Department of Transportation.

“There’s a lot of goods and services being shipped across borders,” Sean O’Brien, president of the International Brotherhood of Teamsters, told a rally in Calgary, Alberta, on Friday. “If this company chooses to continue its bad behavior then there will be an impact. … They have a lot of decisions to make. And they have to make the most important decision: reward these workers with what they’ve earned, and also don’t try to reduce safety just because they need to fuel their bottom line.”

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