Here are five things to know about the freight rail industry in Canada, CN’s role in it, and why the strike caused such alarm.
1) The industry runs from coast to coast to coast but also reaches internationally
The rail system in Canada has 41,465 route-kilometres of track, reaching into every province and territory. Canadian National Railway Company, known as CN Rail, owns 52.8 per cent of the track, with the next largest owner being Canadian Pacific with 30.7 per cent. Other railways own the rest.
While the rail companies move goods within Canada, rail is also how most of Canada’s products reach overseas markets — they are first carried by train to the nation’s ports.
2) Most everything gets carried by rail
In 2018, the system moved more than 331.7 million tonnes of freight. Coal and cargo in containers were the two largest categories, followed closely by grain. Other large categories include forest products, chemicals, petroleum (other than crude oil) and potash, according to an analysis of the sector by the federal government.
Though rail transportation in itself only accounts for about 0.5 per cent of Canada’s GDP, history suggests labour disruptions can have a larger effect.
In an analysis released last week, Toronto-Dominion Bank pointed out that a nine-day labour disruption at CP Rail in 2012 drove a 6.8 per cent drop in the sector’s GDP that month, an impact that Statistics Canada noted in its monthly analysis. The TD Bank review has suggested that if the disruption continues, it could pull as much as $3.1 billion from the economy.
3) The domino effects of the strike are already being felt
CN estimates that as a result of the strike, it’s operating at about 10-per-cent capacity: a small number of managers are qualified to do the striking workers’ jobs but can only keep a fraction of the trains moving. Both Quebec and the Maritime provinces have warned of propane shortages if the strike continues.
Grain-growers can’t get their goods to international markets. Canada’s largest potash mine announced this week it will temporarily shut down and lay off 550 employees as a result of a strike. Short-term layoffs at CN’s auto terminal in Halifax have also been announced.
Chemical companies have suggested they will halt production soon, as they can’t stockpile more than a few days worth of product while waiting for the trains to run again.
4) The striking workers are asking for improvements in several areas
The striking workers are represented by Teamsters Canada. The employees have been without a contract since July.
They have concerns about safety, fatigue, time-off provisions and a lifetime cap on drug-insurance benefits.
One example provided by the union of unsafe conditions is that its members sometimes operate moving trains alone from outside locomotives, hanging on with one hand while working a remote control with the other. CN disputes that the company puts workers at risk.
5) There are a few ways it could end
CN wants the Teamsters to accept binding arbitration by an independent third party the two sides pick together, or by the government.
The union says it still wants to negotiate and notes federal mediation and conciliation officers continue to assist.
Agriculture groups, and some politicians, want the Liberal government to legislate the employees back to work, but the Liberals so far say they want to respect the negotiation process.