TORONTO– Canada’s two largest freight carriers could halt their trains on Thursday if they can’t agree to renewed contracts with the union that represents their engineers, conductors and dispatchers. The Canadian government is keeping a close eye on things and could intervene to prevent widespread damage to the economy.
Both Canadian National and CPKC have been gradually shutting down since last week ahead of the 12:01 Eastern Thursday contract deadline, and all traffic will cease before then if this is not resolved. Shipments containing hazardous chemicals and perishables were the first to be stopped, so they would not be stranded somewhere on the tracks.
As Canadian contract negotiations came to a close, CSX broke with the U.S. freight rail industry’s longstanding practice of collectively negotiating with unions. CSX reached a deal with three of its 13 unions ahead of the start of national negotiations later this year.
The new five-year contract with the Transportation Communications Union, the Brotherhood of Railway Carmen and the Transport Workers Union will provide 17.5 percent pay increases, better benefits and vacation time for about 1,600 employees and the carmen who inspect rail cars. TCU President Artie Maratea said he is proud that his union reached a deal “without years of unnecessary delays and stalling tactics.”
Canadian Prime Minister Justin Trudeau has hesitated to force both sides to arbitration because he doesn’t want to offend the Teamsters Canada Rail Conference and other unions. However, he has called on both sides to reach an agreement on Wednesday because of the huge economic damage that would follow a complete closure.
“It’s in the best interest of both parties to continue to do the hard work at the table,” Trudeau told reporters in Gatineau, Quebec. “Millions of Canadians, workers, farmers, businesses, all across the country, are counting on both parties to do the work and come to a solution.”
Several business groups are urging Trudeau to take action.
Trudeau said the labour minister spoke to both sides of the Canadian national talks in Montreal on Tuesday and would attend the CPKC talks in Calgary, Alberta. Talks at both railways were ongoing on Wednesday.
Negotiations have stalled over issues related to how rail workers are scheduled and concerns about rules designed to prevent fatigue and provide adequate rest for train crews. Both railroads had proposed moving away from the existing system, in which workers are paid based on the number of miles they travel, to an hourly rate system, which they said would make it easier to provide predictable time off.
The railroads said their contract offers included wage increases consistent with recent industry deals. Engineers earn about $150,000 a year at Canadian National, while conductors earn $120,000, and CPKC said their wages were comparable.
Nearly 10,000 employees are covered by these contracts.
Comparable concerns about the quality of life over demanding schedules and lack of paid sick leave nearly led to a American Railroad Strike two years ago until Congress and President Joe Biden intervened and forced the unions to accept a deal.
Countless businesses that rely on railroads to deliver their raw materials and finished products would be hurt if the trains stopped. All rail traffic in Canada and all cross-border traffic with the U.S. would stop, although CN and CPKC’s U.S. and Mexican operations would continue.
Manufacturing companies may have to scale back or even shut down production if they don’t get a rail connection, while ports and grain silos quickly clog with shipments waiting to be moved. And if the dispute drags on for a few weeks, water treatment plants across Canada may be scrambling to get new shipments of chlorine.
Some companies would undoubtedly turn to trucking to move some of their products, but there is no way to offset the volume that railroads provide. It would take about 300 trucks to move everything that one train can carry.
In addition to the potential impact on operations, more than 32,000 commuters could be stranded in Toronto, Montreal and Vancouver as these trains run over the CPKC rail line.
In the United States, all major railroads have made efforts to address worker concerns, and CSX has led the way with the first paid sick leave agreementThe Jacksonville, Florida-based railroad also relaxed its strict attendance policy and announced new efforts to work with its unions.
The current national contracts for U.S. railroad workers expire at the end of this year. This is the first time TCU members have a new agreement before the old one expires, and the deal includes the first improvements to vacation provisions in more than 50 years. If the other railroad unions later get a better deal, this TCU pact will be updated.
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Funk reported from Omaha, Nebraska, while Gillies reported from Toronto.