Freight traffic on Canada’s two largest rail networks could resume “within days,” Labour Minister Steve MacKinnon said Thursday after sending two labour disputes to binding arbitration.
Canadian National Railway Co. (CN) and Canadian Pacific Kansas City Ltd. (CPKC) locked out 9,300 engineers, conductors and yard workers just after midnight Thursday, capping months of increasingly tense and bitter labour negotiations.
Less than 17 hours after the lockout began, MacKinnon announced he’s using his powers as labour minister to step in.
Section 107 of the Canada Labour Code allows the government to refer a labour dispute to the Canada Industrial Relations Board (CIRB) to find a solution.
Minister of Labour Steven MacKinnon says he has directed the Canada Industrial Relations Board ‘to extend the term of the current collective agreements until new agreements have been signed and for operations on both railways to resume forthwith.’
MacKinnon said said he’s directed the board to settle the outstanding terms of the collective agreements and impose final binding arbitration.
“I have also directed the board to extend the term of the current collective agreements until new agreements have been signed, and for operations on both railways to resume forthwith,” he said.
MacKinnon said he expects a resolution “very quickly” but stressed that it’s an independent process.
Asked repeatedly when he thinks trains will start rolling, the minister said “within days.”
Both rail companies released statements Thursday saying they would restart operations following MacKinnon’s announcement, but neither offered a timeline.
MacKinnon said an agreement between the two sides has been “elusive” so far and talks were at an impasse.
“The parties remain very, very far apart on these issues,” he said.
The union said Thursday that picket lines will remain in place and criticized the government for referring the dispute to arbitration.
“Despite claiming to value and honour the collective bargaining process, the federal government quickly used its authority to suspend it, mere hours after an employer-imposed work stoppage,” the union said in a statement.
“The Teamsters Canada Rail Conference will review the minister’s referral and the CIRB’s response, consulting with legal counsel to determine the next steps. Meanwhile, picket lines remain in place.”
Pressure from industry groups and provincial governments to resolve the conflict has been mounting for weeks.
The companies haul a combined $1 billion in goods each day, according to the Railway Association of Canada. Many shipments were pre-emptively stopped to avoid stranding cargo.
The impasse affects tens of thousands of commuters in Toronto, Montreal and Vancouver, whose rail lines run on CPKC-owned tracks. Without traffic controllers to dispatch them, passenger trains cannot run on those rails.
“Collective bargaining is always the best way forward. When that is no longer a foreseeable option — when we are facing serious consequences to our supply chains and the workers who depend on it — governments must act,” Prime Minister Justin Trudeau said on X, formerly Twitter, following MacKinnon’s announcement.
Canadian Manufacturers and Exporters president Dennis Darby welcomed the move but said it will take time for supply chains to return to normal.
“The wind-down of rail services over the last several days, culminating in the full stoppage this morning, has inflicted significant supply chain and operational challenges for manufacturers across the country – issues that will take days if not weeks to resolve,” he said.
“A prolonged stoppage would have imposed enormous costs on Canadian business and workers.”
Freight traffic on Canada’s two major railways stopped early Thursday. Prime Minister Justin Trudeau says the federal government is not taking the situation ‘lightly, because Canadians across the country are worried.’
NDP Leader Jagmeet Singh accused the federal government of undermining workers.
“The Liberals’ actions are cowardly, anti-worker and proof that they will always cave to corporate greed, and Canadians will always pay for it,” he said in a statement.
“There will be no end to lockouts now. Every employer knows they can get exactly what they want from Justin Trudeau by refusing to negotiate with their workers in good faith. And that puts the safety of workers and communities at risk.”
Negotiations collapse
Bargaining played out in separate negotiations between each company and the Teamsters, which represents 6,000 CN workers and 3,300 CPKC workers.
Each side has accused the other of failing to negotiate seriously.
Jonathan Abecassis, director of public affairs and media relations at CN Rail, said that without an agreement or binding arbitration, the company “had no choice” but to lock out employees.
“The Teamsters have shown absolutely no desire to reach a negotiated settlement and prefer to hold Canadian supply chains hostage. We think this is irresponsible, reckless and needs to come to an end as quickly as possible,” he told CBC’s The Current.
“The Teamsters haven’t shown any urgency or any desire to reach a deal that’s good for employees, the company or the economy.”
Abecassis repeated calls for the federal government to intervene with binding arbitration “for the simple reason that we don’t feel we have a partner to negotiate with. You can’t make a deal with an empty chair.”
CPKC also has called for binding arbitration, saying the union has made “unrealistic demands.”
Christopher Monette, public affairs director for Teamsters Canada, rejected those versions of events and accused the two railway companies of colluding to coordinate a shutdown in order to get concessions at the bargaining table.
“This is an employer-driven work stoppage where the main sticking points are company demands for concessions and not union proposals,” he told The Current.
He said the union is fighting for “a more humane rail industry.”
Trains across Canada came to a halt after 9,300 employees at Canada’s largest railways, Canadian National Railway and Canadian Pacific Kansas City, were locked out.
The union has been demanding better wages, benefits and working hours, arguing that what the companies are proposing could lead to fatigue and safety issues.
Abecassis said CN is abiding by government mandated work-rest provisions on which the union collaborated.
“It’s all a bit confusing because the reality of it is that CN can’t offer anything that’s not within the framework of those rules,” he said.
“Both companies are coming after our fatigue protections in our collective agreement,” Monette said. “Our collective agreements provide protections that are superior to the federal minimal standards.”
Cargo congestion fears
Industries affected by the work stoppage include agriculture, mining, energy, retail, automaking and construction. U.S. railways also have had to turn away Canada-bound shipments.
Shippers south of the border also rely on Canada’s two main railways, whose tracks run to the Gulf of Mexico and, in CPKC’s case, to several Mexican ports.
Meanwhile, Canadian ports fear containers will pile up on the docks as cargo goes unmoved, causing congestion down the line and prompting some carriers to reroute to U.S. terminals.
More than 32,000 rail commuters in Toronto, Montreal and Vancouver will also have to find new routes to the office.
Lines affected by the potential work stoppage are TransLink’s West Coast Express in the Vancouver area, Metrolinx’s Milton line and the Lakeshore line’s Hamilton GO station in the Greater Toronto Area, and Exo’s Candiac, Saint-Jerome and Vaudreuil/Hudson lines in the Montreal area.
Just Asking wants to know: What questions do you have about the rail strike? What would you like to know about its impact on Canada’s supply chain and your day-to-day life? Fill out the details on this form and send us your questions ahead of our show on Aug. 24.