By Paul Vieira
OTTAWA--The union representing over 9,000 workers at Canada's two biggest railroads said nearly all of its members voted in favor of going on strike as early as May 22, which could cause extensive disruptions across North American logistics networks.
Teamsters Canada, which is negotiating three labor agreements at Canadian National Railway and Canadian Pacific Kansas City, said Wednesday its negotiators and company executives are at an impasse, claiming the freight carriers are trying to scale back safety provisions, such as ensuring workers have enough rest between shifts.
Paul Boucher, president of Teamsters Canada's rail conference, said simultaneous strikes at the railroads "would disrupt supply chains on a scale Canada has luckily never experienced."
Reverberations would likely extend across the continent. Montreal-based CN operates about 20,000 miles of tracks, connecting Canada's Eastern and Western coasts with the U.S. South, and carries about 300 million metric tons of cargo annually. CPKC's network also runs about 20,000 miles, serving markets across Canada, the U.S. and Mexico. CPKC, based in Calgary, Alberta, generated freight revenue of more than 12 billion Canadian dollars last year.
More than 7,000 workers at ports on Canada's west coast struck for about two weeks in July 2023, disrupting shipping operations across the Pacific Northwest and buffeting the country's economy.
A report from the Canadian legislature's trade committee, published this week, suggested the port strike reduced Canada's gross domestic product by nearly C$1 billion, or the equivalent of $725 million, and affected shipments totaling C$10 billion. The report, citing data from Canada's transport department, indicated it took Canada's supply chain up to six weeks to stabilize following the end of the strike.
"A strike at both of our major railways would be a terrible blow to Canada's diminishing reputation as a reliable place to do business," said Pascal Chan, senior director for transportation, infrastructure and construction at the Canadian Chamber of Commerce. "We simply don't have the capacity to replace the movement of goods by rail."
CPKC said company executives and Teamsters Canada negotiators intend to meet this week, with the help of federal labor conciliators. "Unfortunately, despite our best efforts, the parties remain far apart," the railroad said. The company added it has made offers to the union leadership that provide significant benefits for employees and comply with Canadian regulatory requirements.
CN said the union has made "very few concessions" during five months of talks, "and has been unclear on what it is seeking for employees." It added it has offered significant wage gains and provisions for scheduled time off.
Boucher said the two railroads' proposals would compromise safety for its members, and disputed claims by the companies that they are offering predictable work schedules. He said negotiators on the three agreements are "seeing little to no engagement from the companies" in talks.
Separately, Canadian National said members of the United Steelworkers Local 2004, which represents roughly 2,500 workers largely responsible for track maintenance, ratified a three-year labor deal with the railroad.
CN said the agreement includes wage increases each year and improved health and dental benefits. It also includes measures to increase productivity and reduce the need to outsource work to contractors by creating new positions in the company and allowing more workers to move outside their region when needed, the company said.
--Robb M. Stewart contributed to this article.
Write to Paul Vieira at Paul.Vieira@wsj.com
(END) Dow Jones Newswires
May 01, 2024 16:16 ET (20:16 GMT)
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