TORONTO (AP) — A Canadian arbitrator appointed to resolve a complex railroad labor dispute in a bid to protect the North American economy has ordered employees at the country’s two biggest railroads to return to work so both companies can resume service.
Saturday’s order means Canadian National Railway can continue running trains that resumed service Friday morning, just over a day after locking out employees. But Canadian Pacific Kansas City Railway will likely not be able to resume service by 12:01 a.m. Monday, when employees are ordered to return.
Railroads play a vital role in the economy, with CPKC and CN moving more than CAD1 billion (US$730 million) in freight per day and billions of dollars worth of goods between the United States and Canada each month. Trains for both U.S. and Mexican companies continued to operate, but the lockout caused major disruptions. A number of smaller, short-line freight railroads serving regional deliveries continued to operate across Canada, but were unable to deliver freight to either major railroad during the shutdown.
The Teamsters union, which represents the workers, said it would comply with the Canada Labour Relations Board’s order to return its members to work but would also pursue a legal challenge to the arbitration order.
“The CIRB’s decision sets a dangerous precedent. It sends a signal to Canadian companies that all it takes for a big company to shut down for a few hours and inflict short-term economic pain is for the federal government to step in and dismantle unions,” said Paul Boucher, president of the Teamsters Canadian Railway Congress, which represents more than 9,000 engineers, conductors and dispatchers on both railways.
“Today, workers’ rights in Canada have been severely curtailed,” Boucher added.
Labour Minister Stephen McKinnon ordered an end to the lockout just over 16 hours after it began, as government authorities could not stand by and watch the economic collapse continue if the rail line remained closed.
McKinnon addressed the board’s decision in a post on social platform X, saying he looked forward to the railroad and its employees returning to work as soon as possible.
Businesses across Canada and the U.S. say they will soon be in trouble without rail service, as they rely on freight rail to transport raw materials and finished goods. Without regular deliveries, many businesses may have to cut production or even shut down.
Canadian National Railway trains resumed service Friday morning, but the union had threatened to go on strike starting Monday morning. Saturday’s order nullified the strike threat. Canadian National Railway workers have been on strike since the lockout began early Thursday morning, and the railway’s trains remain suspended.
“While CN is disappointed that an agreement was not reached at the negotiating table, we are gratified that this order effectively brings to an end an unpredictable situation that has adversely affected our supply chain for many months,” the railroad said in a statement. “CN remains focused on resuming freight movement as safely and efficiently as possible.”
Following Saturday’s decision, CPKC formally ended the lockout and asked workers to return to the Sunday day shift, but union spokesman Christopher Monette said the striking workers will not return to CPKC by the order’s Monday deadline.
“We want to get the Canadian economy moving again as quickly as possible and avoid further disruptions to our supply chains,” CPKC said.
Railroads began gradually shutting down their networks more than a week ago and said a full recovery could take weeks as cargo remains stranded at customers’ loading docks and at ports across the country.
The previous contract, which expired late last year, remains in effect while the arbitration process proceeds, and the commission has ordered the union not to further disrupt operations while the arbitration process proceeds.
Negotiations between CPKC and CN broke down over issues of worker schedules and contract provisions aimed at preventing fatigue. The two railroads had proposed changing worker pay from a mileage-based system to one based on hours worked.
Railroads argued that doing so would make it easier to provide predictable time off, but unions resisted, fearing the changes could undermine important fatigue protections and jeopardize workplace safety.
Canadian National and CPKC said they offered pay increases in line with other recent rail industry deals. CN said its engineers earn about C$150,000 a year and conductors earn C$121,000 a year. CPKC said its salaries were comparable.
There has also been contention at CN over efforts to expand a program that allows workers to be temporarily transferred to other areas during staffing shortages: Unions did not want CN to have the power to disrupt families, but the railroad argued the program was voluntary and already in place in some areas.
While Canadian railroads have struggled to reach agreements with unions, major U.S. railroads have been reaching agreements one after another in recent days.
CSX announced its first contract on Wednesday, months before its current one expires and before the traditional national bargaining process that typically takes years begins, and announced seven more on Friday. In all, the new contracts cover more than half of the railroad’s workforce. Norfolk Southern Railway and BNSF Railway followed suit, announcing four contracts each on Friday with some of their 13 unions.
The agreement would help the U.S. railroad industry avoid the kind of fractious labor unrest that nearly led to a strike two years ago, before Congress and President Joe Biden stepped in to force the deal.
