Freight trains across Canada could come to a grinding halt as soon as Thursday with roughly 9,000 railway employees nearing a looming strike or lockout date.
The federal government said the impact of such a strike could be “borne by all Canadians.”
The union representing thousands of workers at Canadian Pacific Kansas City Ltd. says it has served a 72-hour strike notice to the railway.
The Teamsters Canada Rail Conference issued a news release saying unless the parties can reach a last-minute agreement, workers will be off the job as of 12:01 a.m. Eastern time Thursday.
Not long after the union’s statement, CN Rail issued a notice that it intends to lock workers out at that same time unless an agreement or binding arbitration is achieved.
The company says no meaningful progress has occurred despite weekend labour negotiations.
“Unless there is an immediate and definite resolution to the labour conflict, CN will have no choice but to continue the phased and progressive shutdown of its network which would culminate in a lockout,” the company said in a release.
Labour Minister Steven MacKinnon said the stoppages could have an impact on all Canadians.
“These collective bargaining negotiations belong to CN Rail, CPKC and TCRC workers alone – but their effects will be borne by all Canadians,” he said in a statement.
Speaking to Global News, TCRC spokesperson Christopher Monette said the negotiations were about more than just money.
“The main issues now have to do with fatigue, rest, scheduling and forced relocation. The companies want to try to make it seem that our members are all exceedingly well paid and spoiled. But the reality now is that these are billion-dollar corporations, and our members are giving over 80 hours a week of their lives to these companies,” he said.
Monette said the union was currently negotiating three separate contracts. The first two were separate contracts at CPKC and CN for conductors, locomotive engineers, and yard workers. The third contract under negotiation was one for 60 CPKC rail traffic controllers.
“Rail traffic controllers, despite their critical importance to the rail network, are about 25 per cent understaffed. The understaffing is so severe that they can’t always take the maximum amount of rest and vacation that’s available to them under the collective agreement,” he said.
Barry Prentice, director of the transport institute at the University of Manitoba’s Asper School of Business, said Canada was already feeling the impact of the looming shutdown.
“There’s already damage being done,” he said. “The U.S. has embargoed shipments to Canada via rail. The railway has embargo container shipments, and anything refrigerated has been embargoed.”
Rail lines carry more than $1 billion worth of goods each day, according to the Railway Association of Canada. More than half of the country’s exports travel by rail.
Industry groups are also warning about the ripple effects of the stoppages on the wider Canadian economy.
The Canadian Federation of Independent Business (CFIB) called on the federal government to declare ports and railways essential services.
“Any disruptions to railway operations could be devastating for small businesses, their employees and communities. Many small businesses rely on rail services to send and receive goods, products and essential materials. The longer the work stoppage goes on, the costlier it becomes for small firms who may lose sales and contracts if goods are not delivered or received on time,” Jasmin Guenette, CFIB’s vice-president of national affairs, said in a statement.
The group said the shutdown will also disrupt public transit and commuting to big cities such as Toronto or Montreal and lead to increased business costs and supply chain disruptions.
Prentice said in Western Canada, the agriculture sector will be the worst affected.
“The very sensitive agricultural sector is going to be really affected because the harvest is coming off now,” he said.
Food industry groups are also concerned.
“Canada’s red meat processors need stable, reliable supply chains to run their businesses. Another interruption in service will result in millions of dollars in losses, irreversible reputational damage, environmental disposal challenges, and enormous waste,” said Chris White, CEO of the Canadian Meat Council.
René Roy, chair of Canadian Pork Council, said the stoppages affect Canada’s reputation as a reliable international trading partner.
“The ongoing rail and port disruptions threaten the livelihood of our producers, the welfare of our animals, and Canada’s reputation as a reliable trading partner,” Roy said in a statement.
A joint statement by the Canadian Meat Council and the Canadian Pork Council said they want to avoid a repeat of last year’s strike at the Port of Vancouver, which they said resulted in trading losses of more than $10 billion in 35 days.
Fertilizer Canada said the threat of work stoppages had already started to impact the movement of fertilizers and added that they are expecting further embargoes and slowdowns in rail services.
“A work stoppage that prevents the transportation of fertilizer will have potentially disastrous effects on crop yields and food security,” Fertilizer Canada said in a statement last week, before the strike notice was served.
According to the group, 75 per cent of Canada’s fertilizer supply is moved via rail.
Jill Verwey, president of Keystone Agricultural Producers (KAP), told 680 CJOB’s The Jim Toth Show last week that the timing of the potential strike is not good for farmers.
“With producers going to the field currently for some of the spring crops, and as we head into the harvest season, it puts a real strain on our handling facilities and being able to make sure that we get our crop to port in time to meet those deadlines,” Verwey said.
“The timing couldn’t be any worse on a system that has gone through some real challenges as far as trying to meet some supply demands.”
In Saskatchewan, the provincial government has expressed concern.
“This will have a great impact not only on farmers and ranchers here in the province of Saskatchewan but the whole entire economy,” Saskatchewan Agriculture Minister David Merit said.
Prentice said that the impact of a railway shutdown would be felt differently across the country.
“In the east, the railways move a lot of auto parts and automobiles. So those could be switched to trucks in some cases. Maybe they’re already making plans,” he said, adding that it could lead to extra transportation costs and increased road congestion in Ontario.
On Thursday, MacKinnon rejected a request from CN to impose binding arbitration, saying he wants the company to bargain in good faith.
The union responded to CN’s Sunday announcement in a news release accusing the company of being “willing to jeopardize the Canadian economy, and hold supply chains hostage to improve their bottom line.”
On Friday, CPKC said it’s committed to bargaining in good faith and reiterated a standing offer to resolve the matter through binding arbitration.
“While CPKC continues to move as much freight as possible prior to a potential work stoppage, we are taking steps for a safe and orderly shutdown of railway operations in Canada,” the company said in a statement Friday.
CPKC previously served a lockout notice to the union for 12:01 a.m. Thursday.
The union said it’s being forced to serve strike notice to the company to protect workers.
“We do not take this decision lightly, but CPKC’s reckless actions have forced our hand. By unilaterally locking out our members and changing the terms of the collective agreements, they are stripping our members of essential protections,” said president Paul Boucher in the release.
— With files from Canadian Press