Rail transport halted | Ottawa steps in to revive railways

(Ottawa) Trains on Canada’s two largest railways are unlikely to be at a standstill for long. Fearing the dire economic consequences of a prolonged rail shutdown – and under intense pressure – Ottawa is imposing binding arbitration to resolve the impasse.

Citing a “fundamental impasse” between the parties involved in this labour dispute, federal Labour Minister Steven MacKinnon decided that the time had come to intervene late Thursday afternoon.

“That is why it is my duty and my responsibility to use the powers conferred on me under the Canada Labour Code to ensure industrial peace and provide short- and long-term solutions, all in the national interest,” he explained at a press conference.

Represented by the Teamsters Canada Rail Conference, some 9,300 locomotive engineers, mechanics and yard workers at Canadian National Railway Company (CN) and Canadian Pacific Kansas City (CPKC) were locked out after failing to reach an agreement to renew their respective collective agreements before the midnight one deadline on Thursday.

Minister MacKinnon spent the last few days trying to convince the parties to reach an agreement. However, he concluded that the impasse was complete and that this conflict was likely to drag on. Rapid intervention was therefore necessary, he argued, in order to protect the country’s economic interests.

The lockout brought a rail network of more than 35,000 kilometres from coast to coast to coast to a standstill. The value of goods that pass through CN and CP railcars, which are based in Montreal and Calgary respectively, is approximately $1 billion, according to the Railway Association of Canada.

The pressure for rapid action was considerable, coming not only from across the country but also from the United States, Canada’s largest trading partner, which was concerned about the negative impact on its economy.

By car

Early Thursday evening, CN announced the end of the lockout and the deployment of a “Canadian network recovery plan.” That means recalling employees, picking up freight from customers and running trains on its tracks.

“The company is making this decision to accelerate the recovery of the economy,” it said in a statement. “While CN is pleased that this labour dispute has ended and that it can resume propelling the economy, the company is disappointed that a negotiated agreement could not be reached at the bargaining table.”

For its part, the Calgary-based CPKC indicated that it was preparing to restart its network. This will happen once the Canada Industrial Relations Board (CIRB) – the body mandated by Ottawa to help the railways and the Teamsters reach an agreement – ​​has implemented Minister MacKinnon’s instructions. This process could take a few days, the minister suggested.

For the union, the Trudeau government’s decision is downright interference, according to its Canadian president, Paul Boucher. In a press release, the union said it will “consult its lawyers” to study the referral of the case to the CIRB and plan its “next steps.” There could therefore be a union response.

“By resorting to binding arbitration, the government has bypassed a union determined to protect rail safety,” Boucher said.

He said Ottawa did so because its minority in the Commons prevented it from adopting back-to-work legislation “aimed at appeasing the railway companies.”

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Mr. MacKinnon decided to intervene under section 107 of the Canada Labour Code.

“I have mandated the Canada Industrial Relations Board to assist the parties in resolving outstanding terms of their collective agreements, including by imposing final binding arbitration,” he said. “I have also mandated the Board to extend the term of current collective agreements until new agreements are signed.”

There are several points of contention between the two sides, but the availability of rail crews within both companies appears to be at the heart of the impasse.

A conductor can earn around $120,000 annually while the average salary of a locomotive engineer can be as high as $150,000.

In many cases, the schedules are atypical and the availability requirements are too high for the Teamsters’ taste, which, in the union’s opinion, raises safety issues in terms of rail safety.

The Trudeau government also intends to examine a fundamental problem. It wants to take the opportunity to examine the reasons behind the increase in labour disputes in the railway industry in recent years. Strikes occurred at CPKC and CN as recently as 2022 and 2019, respectively.

“Canadians can be confident that their government will not let them suffer when parties fail to live up to their responsibilities,” said MacKinnon. “Negotiated agreements are and will always be the best way forward.”

Over the past week, CN and CPKC had gradually stopped accepting new shipments due to a labour dispute. Several companies were affected by this decision, business circles lamented.

“We are delighted with the speed with which the government acted this time,” explained Véronique Proulx, president and CEO of Manufacturiers et Exportateurs du Québec (MEQ), in a telephone interview. “This helps limit the impact that this conflict could have had if it had dragged on.”

Ottawa’s decision came a few hours after a statement by Prime Minister Justin Trudeau, who had reiterated that his government was well aware of the consequences of this labour dispute.

From the first hours of the conflict, the leader of the NDP, Jagmeet Singh, had quickly made it known that his political party would not support a bill from the Trudeau government forcing a return to work.

“I have always been clear. New Democrats will not support back-to-work legislation or any interference in the bargaining process,” he said in a written statement.

The NDP leader visited locked-out workers on a picket line outside a CN plant on Montreal’s West Island on Thursday. Accompanied by Montreal NDP MP Alexandre Boulerice, he chanted “So-So-So-Solidarity!” with the workers as trucks drove by on a busy industrial street.

The NDP leader visited locked-out workers on a picket line outside a CN facility in Lachine, on Montreal’s West Island, on Thursday. Accompanied by Montreal NDP MP Alexandre Boulerice, he chanted with the workers “So-So-So-Solidarity!” as trucks drove by on a busy industrial street.

The NDP leader promised them he would fight what he called the Trudeau government’s “interference” in the dispute, including forced arbitration or back-to-work legislation.