The standoff could cause economic damage and supply chain disruptions for businesses and consumers in Canada and the United States.
Canada's two major freight railroads have halted operations entirely due to a contract dispute with their workers, in a standoff that could cause significant economic damage to businesses and consumers in both Canada and the United States.
Canadian National (CN) and CPKC railroads have locked out workers after a Thursday deadline passed without new agreements with the Teamsters of Canada Railway Conference, which represents about 10,000 engineers, conductors and dispatchers.
This is the first time the country has faced simultaneous work stoppages at the two companies, which have negotiated labor agreements in alternate years in the past.
All rail traffic in Canada and all shipments crossing the U.S. border have been halted, although CPKC and CN trains will continue to operate in the United States and Mexico.
Labor talks began earlier this year, but progress has been slow as both the union and the companies accuse each other of bad faith.
Negotiations are deadlocked over issues related to how railroad workers’ work is scheduled and concerns about rules designed to prevent fatigue and provide adequate rest for train crews. Both railroads had proposed abandoning the current system, which pays workers based on miles traveled on a trip, and adopting an hourly system that they said would make it easier to provide predictable time off.
Business groups had urged the government to intervene, but Prime Minister Justin Trudeau has refused to force the two sides into arbitration yet, but urged them to reach an agreement Wednesday because of the economic damage that would follow a full shutdown.
“It is in the interest of both sides to continue to work hard at the negotiating table,” Trudeau told reporters in Gatineau, Quebec. “Millions of Canadians, workers, farmers and businesses across the country are counting on both sides to do the work and come to a solution.”
Numerous business groups have urged Trudeau to act.
“Despite the lockout, the Teamsters remain at the bargaining table with both companies,” the union said in a statement.
Effect on trade
Canada, the world's second-largest country by land area, relies heavily on rail to ship grain, fertilizer and raw materials, and the country's main business lobby group estimates losses could reach C$1 billion ($733 million) a day during a shutdown.
If the dispute drags on for a couple of weeks, water treatment plants across the country could be left scrambling without new shipments of chlorine.
According to the U.S. Department of Transportation, billions of dollars worth of goods are transported between Canada and the United States by rail each month.
“If rail traffic is halted, businesses and families across the country will feel the impact,” Jay Timmons, president and CEO of the National Association of Manufacturers, said in a statement. “Manufacturing workers, their communities and consumers of all types of products will be affected by supply chain disruptions.”
