Federal government rejects CN request to intervene in labour dispute ahead of potential lockout, strike

Labour Minister Steve MacKinnon has rejected the Canadian National Railway Company’s request to intervene in the ongoing labour dispute between the company and the union representing railway employees.

The decision by Prime Minister Justin Trudeau’s new labour minister comes ahead of a looming lockout and strike that could begin as early as Thursday, Aug. 22.

Industry groups warn a shutdown of Canada’s railways will impact large swaths of Canada’s economy, including agriculture, automotive, manufacturing and construction.

Canada’s international reputation as a reliable trading partner could also be at stake, industry groups warn, noting that Canada’s railways transport over $1B in goods each day and account for half of the country’s exports.

In a letter addressed to CN’s lawyer, MacKinnon said it is the "shared responsibility" of both Canadian National Railway Company (CN) and the Teamsters Canada Rail Conference (TCRC) to negotiate in good faith and work diligently towards a new collective agreement.

"I trust that with continued effort, an agreement can be achieved promptly. The government firmly believes in the collective bargaining process and trusts that mutually beneficial agreements are within reach at the bargaining table," wrote MacKinnon.

"To support this process, mediators from the Federal Mediation and Conciliation Service remain available to work with you to facilitate productive negotiations and help bridge any gaps," wrote MacKinnon.

In a statement provided to CTV News, CN says it is “disappointed” in the government’s decision not to intervene in the labour dispute, but the company is hopeful that the TCRC will "listen to the Minister’s strong message that they must get serious and engage meaningfully at the negotiating table."

"The Minister must reconsider his decision if they don’t," said Jonathan Abecassis, director of media relations at CN.

CN asked the federal government to intervene last week to "protect Canada’s economy from the impacts of prolonged uncertainty," accusing the TCRC of not engaging "meaningfully" at the negotiating table.

"Unless there is immediate and meaningful progress at the negotiating table or binding arbitration, CN will have no choice but to begin a phased and progressive shutdown of its network, starting with embargoes of hazardous goods, which would culminate in a lockout at 00:01 Eastern Time on August 22nd," the company wrote in a statement published last week.

The union, which represents nearly 10,000 workers at CN and the Canadian Pacific Kansas City railway company, said Thursday that it agrees with MacKinnon that "agreements are within reach at the bargaining table."

"The only way forward is for the rail companies to engage in genuine negotiations at the bargaining table, and to back down from their demands for concessions," wrote Teamsters Canada in a statement provided to CTV News.

Paul Boucher, TCRC president, said rail workers have only ever sought a fair agreement.

"Unfortunately, both rail companies are demanding concessions that could tear families apart or jeopardize rail safety. Rail workers have fought for a safer and more humane industry for decades, and we will not accept moving backwards," he added.

CN insists none of its offers on a new collective agreement jeopardize safety, and the company says the union has made no counter-offers. In the event of a full railway network shutdown, CN says "any product coming to, leaving, or moving within Canada on rail will not be transported."

The union says it will provide 72 hours advance notice in the event of any strike action.

Goldy Hyder, president and CEO of the Business Council of Canada, joined with dozens of industry groups and associations across Canada last week in calling on Trudeau and MacKinnon to intervene in the labour dispute.

"A concurrent or sequential work stoppage at both major railways will leave Canadians with access to fewer goods and products, driving up prices and exacerbating affordability challenges. A failure to act swiftly will also put the livelihoods of millions of workers in jeopardy," wrote Hyder, who described the magnitude of the potential disruption as "daunting."

"A disruption to our railway system will have an immediate impact on thousands of businesses from coast to coast and to commuters in several major urban centres," Hyder said. "All of Canada's ports, logistics and warehouse operators, and suppliers will be affected, while a prolonged stoppage will quickly lead to shortages of supplies for numerous industries, forcing businesses to suspend their operations and furlough their employees."