The country’s two major railroads are beginning to halt deliveries in anticipation of a possible strike or lockout next week.
Canadian National Railway Company (CN) says in an internal memo obtained by The Canadian Press that the company has begun embargoing certain dangerous goods from the United States in anticipation of a work stoppage.
These goods include chlorine for disinfecting drinking water and ammonia for fertilizers, as well as other toxic or poisonous substances and explosive materials.
“In the absence of a timely agreement in principle or referral of all outstanding issues to binding arbitration prior to the threat of a work disruption, additional goods will be embargoed,” CN’s negotiating team said in its message Tuesday.
Canadian Pacific Railway Kansas City (CPKC) said Friday it would temporarily ban the transportation of hazardous materials to ensure none are stranded on the tracks in the event of a strike.
PHOTO NATHAN DENETTE, CANADIAN PRESS ARCHIVES
Canadian Pacific Train Kansas City
On Monday, the company embargoed all cargo classified as toxic or “inhalable hazards” on its North American network, according to a notice to customers.
“CPKC’s operational objective is to ensure a safe and structured shutdown of all our Canadian rail operations,” the update said, adding that leaders “remain available” to negotiate.
CN and CPKC warned last week that they would lock out some 9,300 engineers, conductors, yard workers and rail traffic controllers on Aug. 22 unless they can reach an agreement after negotiations over hours and wages stalled.
Shippers say a work stoppage could cripple the country’s supply chain, interrupting the flow of goods and disrupting industries.
Public safety issues
Goods essential to public health as well as agriculture, mining and forestry are generally among the products subject to the initial embargoes, said Bob Masterson, president and CEO of the Chemistry Industry Association of Canada.
“When we talk about public safety, it’s the volumes that will disappear first,” he said, giving the example of chlorine for municipal drinking water.
“Usually they have a week’s supply and it’s constantly replenished. If we don’t get it for a week and then there’s the work stoppage […]you will start to feel negative effects.”
Members of this industrial group, made up of producers of plastics and chemicals, rely on rail transport for 80% of the sector’s $100 billion in annual shipments.
With most fertilizers manufactured in Canada also being transported by rail, Fertilizers Canada says the perception of the country’s commercial reliability is uncertain.
“Canada’s reputation has been tarnished by numerous supply chain disruptions in recent history,” association president Karen Proud said in a statement. “This uncertainty gives an advantage to our international competitors, such as Russia and China.”
The embargoes that began Tuesday impact ammonia-based fertilizer products. Service for all products will also begin to slow three to five days before a work stoppage, and it will take three to five days to return to normal service once the work stoppage ends.
The lockout warnings issued by the railways to the Teamsters Canada Rail Conference last Friday came hours after the National Labour Board ruled that a work stoppage would not pose a “serious danger” to public health or safety, opening the door to a full-blown strike or lockout. If either occurs, CN or CPKC employees would not be required to continue hauling freight.
The labour court ordered a 13-day cooling-off period in both rulings on Friday morning, leaving August 22 as the earliest possible date for a strike or lockout.
Federal intervention requested
The Business Council of Alberta on Tuesday demanded federal intervention, echoing a call last week by more than 70 industry groups and 40 local chambers of commerce.
“If a prolonged work stoppage were to occur, the negative impacts would be profound and long-lasting for all Canadians, with the greatest impact felt by Western Canadian farmers,” wrote Adam Legge, president of the Alberta Business Council.
“We urge the government to immediately take all necessary steps to achieve a rapid resolution.”
Federal Labour Minister Steven MacKinnon, who met with railway and union representatives last week, urged both sides to reach an agreement.