Canada is barrelling towards a massive rail shutdown. Leaders urge railways, union to finalize deal

Facing mounting calls to preventa massive railway disruption in the coming hours, Finance Minister Chrystia Freeland said Wednesday the federal government expectsCanada's two main railway companies and their union to "do their jobs" and reach an agreement to stave off a hit to the economy.

"We simply cannot afford, we cannot tolerate, a self-inflicted wound. And that is why I am saying with real seriousness to the companies and to the union your country is counting on you," she told reporters during a news conference in Fort Saskatchewan, Alta.

"Your friends, your neighbours, your relatives, every single one of them needs you to do your job, take your responsibility seriously and get a deal."

For the first time,Canadian National Railway (CN) and Canadian Pacific Kansas City (CPKC)are both on the brink of lockingout thousands of workers in the midst of simultaneous and tense labour negotiations.

The companies say they will start locking out workers in the early hours of Thursday if they cannot reach a deal with the union representing 9,300 engineers, conductors and yard workers. That would bringthe roughly $1 billion worth of goods that move on the companies' tracks every day to a sudden stop.

WATCH: Freelandtells railways, union not to 'sabotage' economy

Freeland tells railway companies, union not to 'sabotage' Canadian economy

6 days ago

Duration 3:52

Deputy Prime Minister and Finance Minister Chrystia Freeland says the federal government is expecting CN Rail, CPKC and the Teamsters union to get a deal done ASAP as the deadline for a potential rail stoppage approaches.

The federal government has been under pressure to intervene to avoid a work stoppage that's expected to affect supply lines fora wide range of goods, from agriculture freight to manufacturedproducts.

Earlier in the day, the Canadian Chamber of Commerce, the Business Council of Canada, the Canadian Federation of Independent Business and the Canadian Manufacturers & Exporters issued a joint statementcalling on the federal government to take "immediate action" to keep trains and the goods they carrymoving.

"The government of Canada has a responsibility to protect the Canadian public and maintain national security, and it is time to act decisively to fulfilthat obligation," said the statement.

They argue that under Article 107 of the federal labour code, Labour Minister Steven MacKinnon could refer the dispute to the Canada Industrial Relations Board for binding arbitration, and could prohibit a strike, a lockout or any ongoing stoppage pending a resolution.

The federal governmentcould also reconvene Parliament and introduce back-to-work legislation, the groups say.

"This is not about siding with either party; it is about standing up for Canadians," said the business organizations' statement.

"The federal government must show leadership and act before our trains and with them, our economy grind to a halt. Otherwise, the steep price of inaction will be paid by Canadian families, workersand businesses."

WATCH | Trudeau says Canadians are counting on both sides reaching a resolution at the table

PM says Canadians are counting on both sides reaching a resolution as rail stoppage looms

6 days ago

Duration 0:41

Prime Minister Justin Trudeau says its in the best interest of CN Rail, CPKC and the Teamsters union to continue doing the hard work at the table to find a negotiated resolution. Canada's two main railway companies say they will start locking out workers Thursday if a deal is not reached, while the union says it is ready to call a strike for that day.

Neither Freeland nor Prime Minister Justin Trudeau, who spoke earlier in the day, suggested they're entertaining that proposal.

"Our plan is for the parties to listen to Canadians, listen to their neighbours, listen to their friends, to recognize that it is totally unacceptable for us as a country to sabotage ourselves right now," said Freeland.

"The country has no patience for dillydallying right now."

Government rejected CN's call for arbitration

The government already has has rejected CN's request for binding arbitrationand has instead urged the parties to hammer it out at the negotiating table.

"My message is straightforward. It is in the best interest of both sides to continue doing the hard work at the table to find a negotiated resolution," Trudeau said during brief remarks Wednesday.

The union has been demanding better wages, benefits and working conditions for workers.

The Teamsters Canada Rail Conferencehas claimed that CPKC wants to "gut the collective agreement of all safety-critical fatigue provisions."The union says CN is foisting a relocation clause on employees that would forcethem to moveacross Canada for months at a time to fill labour shortages.

In a statement issued earlier this week, the Teamsters said that, so far, there have been "no meaningful advancements" in bargaining.

Barry Eidlin, associate professor and labour expert at McGill University, said Canada used to have a reputation for"being pretty trigger-happy" when it comes to imposing back-to-work legislation. That changed with the2015 Supreme Court decision affirming the constitutional right to strike.

"We are in a different era," Eidlinsaid. "This current Trudeau government does seem to take that right seriously, and has repeatedly stated that the best deals are negotiated at the bargaining table."

He said there are drawbacksfor both sideswhen binding arbitration is used.

"That, overtime ... erodes the confidence in the process," he said. "And so it erodes the whole collective bargaining institution as a whole."

MacKinnonrepeatedly toldCBC's Power & Politics onWednesdaythe government supports collective bargaining.

"I'm not going to get into what-ifs. The parties have to understand one thing very clearly, that it is in their hands, that the stakes are high," he said.

Some commuter and VIA Rail lines would be affected

A phased shutdown of the railway networks is already underway. Transit authorities have said some commuter lines that run on CPKC tracks in Toronto, Montreal and Vancouver will be affected if dispatchers walk off the job.

VIA Rail, which operates on some CPKC-owned rail infrastructure, said it has negotiated continued access to a one-kilometre section of tracks in Smiths Falls, Ont., and will continue to operate its regular OttawaToronto serviceif the lockdown goes ahead.

VIA Rail also said in a statement Thursday it will lose access to CPKC tracks for its SudburyWhite-River services and would have to suspend operations until the work stoppage is resolved.

The intercity passenger rail company said no other service would be affected.

The Canadian Trucking Alliance said some shippers are alreadylining up extra trucking capacity to fill the breach.

But industry members say trucks can't match rail'sefficiency and aren't equipped to transport commodities like potash, grain and coal.

U.S.Secretary of Transportation Pete Buttigiegsaid his department is closely monitoring the negotiationsand any potential impacts on the flow of goods across the border.

"We are engaging with our Canadian counterparts and tracking the flow of vital goods to U.S. consumers and businesses," he posted on social media.