The Canadian Government moved with haste on Thursday to end an unprecedented railway shutdown, saying it would ask the country’s industrial relations board to issue a back-to-work order.
Canada’s two biggest rail networks — Canadian National Railway (TSX:CNR) and Canadian Pacific Kansas City (TSX:CP) — had locked out some 9,300 unionised workers earlier in the day, leading to a widespread cessation of railway traffic that could inflict hundreds of millions of dollars in economic pain.
The world’s second-largest country by area, Canada relies heavily on trains to move a wide variety of commodities and industrial goods. Both its economy and rail network are firmly integrated with those of the US, meaning the economic fallout could be felt across the whole North American supply chain.
Canada’s industrial relations board, which is independent, will now consult the companies and the Teamsters union before issuing an order.
“I assume that the trains will be running within days,” Labour Minister Steven MacKinnon told reporters.
In addition to requesting a back-to-work order, MacKinnon has also asked the board to launch a process of binding arbitration between the union and the companies.
MacKinnon’s stance represents a departure from the position of Prime Minister Justin Trudeau’s Liberal government, which had previously said it wants to see the matter settled at the negotiating table.
“We gave negotiations every possible opportunity to succeed . . . but we have an impasse here,” MacKinnon says.
“And that is why we have come to this decision today.”
Both the rail companies and the Teamster union have blamed each other for the stoppage after several rounds of discussions failed to reach a labour agreement.
The situation began at the end of December last year, when contracts covering locomotive engineers, conductors, and yard workers at CNR and CPKC expired. President of Teamsters Canada, Paul Boucher, noted at the time that no progress had been made in six months of negotiations, and that the rail companies were trying to remove rest provisions that are critical to safety.
On the other hand, CNR said the union had opposed moving toward a more modern labour deal based on an hourly rate and scheduling changes, and had instead focused on 200 local and regional demands.
As a result of the breakdown in discussions, the unionised workers voted more than 95% to authorise a strike.
Then, in February, the Teamsters claimed that CNR and CPKC were “not serious about negotiating and avoiding a work stoppage”, and that the two companies were aiming to “eliminate all safety-critical rest provisions from our collective agreements”.
Over the next six months, discussions repeatedly hit deadlocks before negotiations were formally resumed with the assistance of federal mediators. Still, no agreement was reached.
“Throughout this process, CN and CPKC have shown themselves willing to compromise rail safety and tear families apart to earn an extra buck,” Boucher said in a statement on Thursday.
“The railroads don’t care about farmers, small businesses, supply chains, or their own employees. Their sole focus is boosting their bottom line, even if it means jeopardising the entire economy.”
Unions are typically averse to contracts decided through arbitration, since it removes their ability to leverage better terms by withholding labour.
The left-leaning New Democratic Party, which typically enjoys strong support from unions and helps to prop up Trudeau’s government, opposed the decision “to undermine 9,300 workers with a binding arbitration order”.
“Justin Trudeau has just sent a message to CN, CPKC and all big corporations — being a bad boss pays off,” party leader Jagmeet Singh said in a statement yesterday.
“The Liberals’ actions are cowardly, anti-worker and proof that they will always cave to corporate greed, and Canadians will always pay for it.”
Already, the stoppage has crippled shipments of grain, potash, and coal, while also slowing the transit of petroleum products, chemicals, and vehicles. Tens of thousands of people dependent on certain commuter railways in Toronto, Vancouver, and Montreal have also been hit, since all traffic on such CPKC-owned lines has been halted indefinitely.
Write to Oliver Gray at Mining.com.au
Images: Canadian National Railway
