TORONTO (AP) \u2014 Both of Canada\u2019s major freight railroads have come to a full stop because of a\u00a0contract dispute\u00a0with their workers, an impasse that could bring\u00a0significant economic harm\u00a0to businesses and consumers in Canada and the U.S. if the trains don\u2019t resume running soon.<\/p>\n\n\n\n
Canadian National and CPKC railroads both locked out their employees after the deadline of 12:01 a.m. Eastern Thursday passed without new agreements with the Teamsters Canada Rail Conference that represents some 10,000 engineers, conductors and dispatchers.<\/p>\n\n\n\n
All rail traffic in Canada and all shipments crossing the U.S. border have stopped, although CPKC and CN\u2019s trains will continue to operate in the U.S. and Mexico.<\/p>\n\n\n\n
Billions of dollars of goods each month move between Canada and the U.S. via rail, according to the U.S. Department of Transportation.<\/p>\n\n\n\n
\u201cIf rail traffic grinds to a halt, businesses and families across the country will feel the impact,\u201d Jay Timmons, president and CEO of the National Association of Manufacturers, said in a statement. \u201cManufacturing workers, their communities and consumers of all sorts of products will be left reeling from supply chain disruptions.\u201d<\/p>\n\n\n\n
There will be other impacts as well, including on the more than 30,000 commuters in Vancouver, Toronto and Montreal who will be scrambling to find a new way into work because their trains won\u2019t be able to operate over CPKC\u2019s tracks while the railroad is shut down.<\/p>\n\n\n\n
Business groups had urged the government to intervene, but Prime Minister Justin Trudeau has declined to force both sides into arbitration yet.<\/p>\n\n\n\n
CN said it was waiting for a response on one final offer made late Wednesday when it locked the workers out. CPKC spokesperson Patrick Waldron said the union rejected its last offer that CEO Keith Creel made at the table in person. Both railroads have said they would end the lockout if the union agreed to binding arbitration.<\/p>\n\n\n\n
\u201cDespite the lockout, the Teamsters remain at the bargaining table with both companies,\u201d the union said in a statement.<\/p>\n\n\n\n
CN had been negotiating with the Teamsters for nine months while CPKC had been trying to reach an agreement for a year, the unions said.<\/p>\n\n\n\n
Many companies across all industries rely on railroads to deliver their raw materials and finished products, so without regular rail service they may have to cut back or even close.<\/p>\n\n\n\n
That\u2019s why the U.S. government kept rail workers from going on strike two years ago and forced them to accept a contract despite their concerns about demanding schedules and the lack of paid sick time.<\/p>\n\n\n\n
Canada\u2019s railroads have sometimes shut down briefly in the past during contract negotiations \u2014 most recently CPKC was offline for a couple days in March 2022 \u2014 but it is rare for both railroads to stop at the same time. The impact on businesses will be magnified because both CN and CPKC have stopped.<\/p>\n\n\n\n
Both CN and CPKC had been gradually shutting down since last week ahead of the contract deadline. Shipments of hazardous chemicals and perishable goods were the first to stop, so they wouldn\u2019t be stranded somewhere on the tracks.<\/p>\n\n\n\n
As the Canadian contract talks were coming down to the wire, one of the biggest U.S. railroads, CSX, broke with the U.S. freight rail industry\u2019s longstanding practice of negotiating jointly for years with the unions. CSX reached a deal with several of its 13 unions that cover 25% of its workers ahead of the start of national bargaining later this year.<\/p>\n\n\n\n
The new five-year contracts will provide 17.5% raises, better benefits and vacation time if they are ratified. The unions that have signed deals with CSX include part of the SMART-TD union representing conductors in one region, the Transportation Communications Union, the Brotherhood of Railway Carmen and the Transport Workers Union. TCU President Artie Maratea said he\u2019s proud that his union reached a deal \u201cwithout years of unnecessary delay and stall tactics.\u201d<\/p>\n\n\n\n
Trudeau has been reluctant to force arbitration because he doesn\u2019t want to offend the Teamsters Canada Rail Conference and other unions, but he urged both sides to reach a deal Wednesday because of the tremendous economic damage that would follow a full shutdown.<\/p>\n\n\n\n
\u201cIt is in the best interest of both sides to continue doing the hard work at the table,\u201d Trudeau said to reporters in Gatineau, Quebec. \u201cMillions of Canadians, workers, farmers, businesses, right across the country, are counting on both sides to do the work and get to a resolution.\u201d<\/p>\n\n\n\n
Numerous business groups have been urging Trudeau to act.<\/p>\n\n\n\n
Trudeau said Labor Minister Steven MacKinnon met with both sides in the CN talks in Montreal on Tuesday and would be on hand for the CPKC talks in Calgary, Alberta. MacKinnon later said he wrapped up his meetings with the rail companies and the Teamsters.<\/p>\n\n\n\n
\u2018Workers, farmers, commuters and businesses can\u2019t wait. Canadians need urgency at the table. The parties need to get deals done now,\u201d he posted on the social platform X.<\/p>\n\n\n\n
The negotiations are stuck on issues related to the way rail workers are scheduled and concerns about rules designed to prevent fatigue and provide adequate rest to train crews. Both railroads had proposed shifting away from the existing system, which pays workers based on the miles in a trip, to an hourly system they said would make it easier to provide predictable time off.<\/p>\n\n\n\n
The railroads said their contract offers have included raises consistent with recent deals in the industry. Engineers make about $150,000 a year on Canadian National while conductors earn $120,000, and CPKC says its wages are comparable.<\/p>\n\n\n\n
Similar\u00a0quality-of-life concerns\u00a0about demanding schedules and the lack of paid sick time nearly led to a\u00a0U.S. rail strike\u00a0two years ago until Congress and President Joe Biden\u00a0intervened\u00a0and forced the unions to accept a deal.<\/p>\n\n\n\n
Manufacturing companies may have to scale back or even shut down production if they can\u2019t get rail service, while ports and grain elevators will quickly become clogged with shipments waiting to move. And if the dispute drags on for a couple weeks, water treatment plants all across Canada might have to scramble without new shipments of chlorine.<\/p>\n\n\n\n
\u201cIf railways are not picking up the goods that are coming in by ships, then pretty soon your terminals get filled up. And at that point you cannot take any vessels at the terminal anymore,\u201d said Victor Pang, chief financial officer at the Vancouver Fraser Port Authority.<\/p>\n\n\n\n
He pointed to the 13-day strike by 7,400 British Columbia dockworkers last summer, which manufacturers said blocked the flow of $500 million Canadian (US$368 million) worth of goods each day.<\/p>\n\n\n\n
Some companies would undoubtedly turn to trucking to keep some of their products moving, but there\u2019s no way to make up for the volume railroads deliver. It would take some 300 trucks to haul everything just one train can carry.<\/p>\n","protected":false},"excerpt":{"rendered":"
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