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Canadian Freight Halt Anticipated with Possible Rail Strike

Canadian Freight Halt Anticipated with Possible Rail Strike

Canadian freight rail traffic could come to a halt in May, with the looming possibility of a strike by approximately 3,300 workers at Canadian Pacific Kansas City (CPKC) and a further 6,000 at rival Canadian National Railway (CN). Read on to learn more. CPKC and CN initiated the bargaining process for a new collective agreement for train conductors, engineers, and yard workers last February. However, negotiations between railway labor and management have failed to reach agreements, leading to ongoing discussions with federal conciliators since March 1.

Earlier this month, leaders of the Teamsters Canada Rail Conference (TCRC) told their members that a strike vote would be held from April 8 to May 1. If the vote favors authorizing it, a strike or lockout will occur as early as May 22. Now the country is bracing itself as the negotiation deadline approaches. 

TCRC has raised safety concerns, alleging that both CPKC and CN aim to eliminate critical safety provisions from their collective agreements. However, CN's Chief Network Operating Officer, Patrick Whitehead, refuted these claims, stating they were inaccurate.

CPKC’s chief executive, Keith Creel, emphasized the need to prepare for the worst while hoping for the best, stating that there has been minimal change in positions during negotiations. 

The Canadian freight transportation landscape might be further complicated amidst ongoing tensions between Montreal port employers and dockworkers. In March, Cargo companies began rerouting away from Montreal in case a port strike occurred.

Proposed wage and work schedule adjustments

CN and CPKC have proposed significant changes to traditional compensation and work schedules for train and engine crews. The proposed changes include replacing the mileage-based pay system with an hourly wage and implementing predictable work schedules, including scheduled days off, to comply with the Transport Canada Duty and Rest Period Rules introduced last year.

CN has suggested a new hourly wage structure that would increase engineer pay by an average of 15.5% and ensure guaranteed minimum annual earnings. Additionally, train crew schedules would feature either two or three consecutive days off under CN's proposal. 

Similarly, CPKC has presented two options for renewed contracts.

The first option focuses on providing substantial pay raises and improved work-life balance by offering scheduled, predictable days off through a simplified system. CPKC describes this offer as a progressive, modern time-based pay model designed to enhance employee benefits.

The second option maintains competitive wage increases aligned with recent settlements and preserves existing work rules within the new Transport Canada regulatory framework for rest. CPKC's proposal adjusts the held away from home provision for train crews while otherwise maintaining the status quo.

These proposals reflect the ongoing efforts of both CN and CPKC to address the needs and preferences of their employees while navigating regulatory changes and industry standards.

The ongoing negotiations underscore the importance of reaching a mutually beneficial agreement to address the concerns of all stakeholders involved.

The consequences of the Canadian Freight landscape

It is still unclear whether a strike or lockout will occur, which will potentially affect thousands of Canadian importers and become a concern for the Canadian freight landscape and the broader Canadian economy.

In an update, CN expressed its commitment to reaching a negotiated agreement during the conciliation period, emphasizing its goal to benefit employees, customers, and the economy. CN also reiterated its dedication to modernizing contracts to ensure employee satisfaction with financial compensation and work-life balance.

At Cole International, we’re following the story and will keep you informed as the updates unfold. If you need to discuss your freight forwarding options, please reach out to one of our trade professionals

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