The dispute that has brought Canada’s two biggest railways to a standstill could soon be over.
Labour Minister Steve MacKinnon announced Thursday afternoon that he’s sent the dispute to binding arbitration and has ordered operations on both railways to resume as quickly as possible.
Freight traffic on the two largest rail networks came to a halt simultaneously just after midnight Thursday after months of increasingly tense and bitter labour negotiations.
Canadian National Railway Co. (CN) and Canadian Pacific Kansas City Ltd. (CPKC) locked out 9,300 engineers, conductors and yard workers after the parties failed to agree on a new contract before the midnight deadline.
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.
MacKinnon said an agreement between the two sides has been “elusive” so far. He 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.
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 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.
Pressure from industry groups and 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.
Negotiations collapse
Parties bargained late into the night Wednesday at hotels in Montreal and Calgary before talks broke off shortly before midnight.
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.”
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.”
Business groups calling for binding arbitration
Business groups have called on the government to impose binding arbitration and ban strikes and lockouts as the process plays out.
A statement from Perrin Beatty, president and CEO of the Canadian Chamber of Commerce, was critical of the federal government’s role in the dispute, saying it had the opportunity to act but chose not to.
“Canadians are already contending with a high cost of living. They need to see decisive leadership from government that puts their families and livelihoods first,” the statement said.
WATCH | Strike’s economic impact could be millions each day:
“The Minister of Labour must use the tools at his disposal to immediately resolve this conflict through binding arbitration,” the statement continued.
NDP Leader Jagmeet Singh reiterated his party’s long-held opposition to back-to-work legislation.
“Canada has a government that caves to corporate greed. The result is labour disruptions and workers struggling to get fair pay and safe working conditions,” he said in a media statement Thursday.
“It’s backwards, and it hurts everyone but the billionaires at the top.”
The federal Conservative Party has not responded to CBC’s request for comment.
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.