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Minister Forces Arbitration to Resolve Canada Rail Dispute

Canada’s Labor Minister, Steven MacKinnon, has ordered final binding arbitration to end a rail work stoppage involving over 9,000 workers and the country’s two class 1 railroads, Canadian National Railway (CN) and Canadian Pacific Kansas City (CPKC).

MacKinnon’s decision came after 17 hours without a new labor deal. Both railroads wanted binding arbitration, while the union, Teamsters Canada Rail Conference (TCRC), opposed it. Despite the order, a strike is still possible. The core issues include wages and work-rest rules. CN and CPKC argue that a shift to per-hour wages would benefit workers, but the union disagrees, claiming it would reduce salaries.

The rail work stoppage has wide-reaching impacts across North America, including halting cargo movement at Canadian ports and affecting U.S. railroads which are no longer accepting Canada-bound containers. Transload operations are also facing increased pressure as Canadian trucking faces a surge in demand.

U.S. railroads, including BNSF Railway and Union Pacific Railroad, expect increased business, which will put pressure on railcar supply, locomotive power, and train crews. Importers in Chicago might dray containers from Vancouver to Seattle or Tacoma for Midwest delivery using BNSF or UP.

Source: Journal of Commerce

Minister MacKinnon said he is invoking powers under Section 107 of the Canada Labor Code to direct the Canada Industrial Relations Board (CIRB) to "assist the parties in settling the outstanding terms of their collective agreements by imposing final binding arbitration." Minister MacKinnon has also ordered CIRB to extend the term on the parties' current collective agreements until new deals have been signed and is calling for operations on both railways to resume "forthwith."