As rail shutdown looms, Freeland vows no tolerance for ‘self-inflicted wound’

August 21, 2024 Canuck

It is “entirely unacceptable” for parties in a looming nationwide railway shutdown to risk sabotaging Canada’s economic progress, finance minister Chrystia Freeland says.

“It is entirely unacceptable for anyone to get in the way of that economic progress that we have all been making and that has been so hard-fought and so hard-won,” Freeland told reporters.

She said Canadians expect Canadian Pacific Kansas City Ltd., Canadian National and the Teamsters Canada Rail Conference to negotiate in good faith and reach a solution.

“Your customers expect that, your customers’ employees expect that, farmers … expect that. Canada and Canadians expect that,” she said.

“We cannot tolerate a self-inflicted wound.”

Freight trains across Canada could come to a grinding halt as soon as midnight on Wednesday with roughly 9,000 railway employees nearing a looming strike or lockout date.

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The union representing thousands of workers at Canadian Pacific Kansas City Ltd. says it has served a 72-hour strike notice on the railway.

The Teamsters Canada Rail Conference issued a news release Sunday saying that unless the parties reach a last-minute agreement, workers will be off the job as of 12:01 a.m. eastern time Thursday.

Not long after the union’s statement, CN Rail issued a notice that it intends to lock workers out at that same time unless an agreement or binding arbitration is achieved.

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Trudeau added, “My message is very straightforward. It is in the best interest of both sides to continue doing the hard work at the table to find a negotiated resolution. Millions of Canadians, of workers, of farmers, of businesses right across the country are counting on both sides to do the work and get to a resolution.”

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Canadian manufacturers, exporters and voices from the industry are urging the federal government to step in.

“A rail strike right now would be catastrophic to the sector. But it’s one that I think could be avoided if the government decides to act,” Dennis Darby, president and CEO of Canadian Manufacturers and Exporters (CME), told Global News.

According to the CME, Canada’s railways transport $380 billion worth of goods annually – that’s over $1 billion each day. Of that, the CME estimates that approximately $531 million of manufactured goods will be stranded each day of a stoppage.

Darby said they surveyed their members and found that 92 per cent expect some sort of delay or penalty if the shutdown goes ahead.

“About three-quarters of everything we produce goes to the U.S. And rail is a key component in moving those goods,” he said.

Stephen Laskowski, president of the Canadian Trucking Alliance, said some rail customers were already starting to look at the trucking industry for support.

“Shippers across the country are now looking, if they can, to alternative mode of transportation, particularly trucking,” he said.

“Can trucking help during this strike crisis? Yes. But it’s limited,” he said.

Darby said, “One train is worth about is worth over 300 trucks. There’s so much extra needed capacity. And for large items, for bulk items, for large machinery, there really is no alternative to rail.”

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Laskowski said the trucking industry faces its own challenges with capital and labour shortages.

“No trucking company is going to go out and add extra capital or extra labour because of a strike,” he said.

Darby said the federal government needs to bring in binding arbitration, a measure that the unions have resisted.

“Binding arbitration is never the right approach. First off, this would allow the company to get concessions that they could not otherwise get through good-faith negotiations,” TCRC spokesperson Christopher Monette said.

The federal Liberals need the support of at least one other party to pass legislation, and their current supply-and-confidence agreement partners in the NDP have urged Ottawa not to use binding arbitration, saying it “would take away the unions’ power to negotiate for their workers.”

Will shoppers feel the pinch?

The Retail Council of Canada is warning that the looming railway strike is going to have an impact on holiday shoppers as many retailers begin stocking up many months in advance.

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“The stakes are high. This has the potential to wreak havoc on retailers, particularly if you look at the upcoming holiday shopping season,” Michelle Wasylyshen, spokesperson for the Retail Council of Canada told Global News.

Wasylyshen said that while the back-to-school supplies should already be on the shelves, holiday shoppers will be hit across sectors.

“It’s food, it’s fashion, it’s footwear, it’s furniture, it’s appliances, it’s sporting goods, it’s electronics. It goes on and on and on,” she said.

She said smaller retailers are being hit harder.

“It’s different if you’re a bigger retailer because they can perhaps look for backup on trucking systems and other kind of backup plans. For our small retailer members it’s dire. Smaller retailers have a more difficult time in terms of looking for backup.”

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