Canada’s two largest railways, Canadian National Railway (CN) and Canadian Pacific Kansas City (CPKC) have halted operations nationwide after locking out 9,300 workers, according to the Globe and Mail. The work stoppage occurred after both parties failed to reach a new contract agreement before 12:01 a.m.
The shutdown marks the first simultaneous work stoppage at both CN and CPKC. According to the Railway Association of Canada, the stoppage disrupts approximately $1 billion in goods movement daily, with some shipments already pre-emptively halted to prevent cargo from being stranded.
“Without an agreement or binding arbitration, CN had no choice but to finalize a safe and orderly shutdown and proceed with a lockout,” a statement from CN reads.
Negotiations between the railways and the Teamsters Canada Rail Conference, which represents the workers, focused on wages and schedule but failed to produce an agreement before the deadline, according to the Globe and Mail. Talks continued into the evening, with Labour Minister Steven MacKinnon meeting separately with both sides in Calgary earlier in the day.
Despite months of negotiations, the Teamsters Canada Rail Conference says the parties remained far apart. CN and CPKC initiated what the union described as an “employer-driven work stoppage.”
Next steps toward change
The work stoppage has prompted business groups to call on the federal government to intervene and prevent further disruption to supply chains. Furthermore, the government has suggested that it refer the dispute to the Canada Industrial Relations Board for binding arbitration or pass back-to-work legislation.
FHCP president Michael Graydon recently alluded to the necessity of the measure.
“I’m a strong supporter of collective bargaining and agreements, but we need to recognize that when monopolies are allowed in certain sectors, we need a different approach to labour disputes. We can’t afford to be held hostage in this environment. It’s ridiculous that the new board didn’t deem rail service as essential. I can’t believe they reached that conclusion, given the huge impact on consumers. The government doesn’t seem interested in intervening; they want the bargaining process to play out. However, I think binding arbitration would be a reasonable solution,” Graydon says.
In response to the anticipated stoppage, Canadian Pacific began barring new shipments on Tuesday (Aug. 20), followed by CN on Wednesday (Aug. 21).
The industries most affected by the shutdown include agriculture, mining, energy, retail, automaking and construction. According to the Globe, retailers are particularly concerned about the impact on holiday and seasonal products, with some items already being withheld from transportation to avoid potential backlogs.
Additionally, more than 32,000 rail commuters across the country may need to find alternative transportation due to the work stoppage. Several commuter lines that operate on Canadian Pacific tracks in Toronto, Montreal and Vancouver face potential suspension if dispatchers walk off the job.
“Product is not being loaded onto various forms of transportation because of the expectation that it could just get backlogged and stuck. We’re looking at holiday shopping products, Halloween products, even food items,” says Michelle Wasylyshe, Retail Council of Canada (RCC) spokesperson.
