TORONTO — The Canadian arbitrator appointed to resolve a sensitive rail labour dispute to protect the North American economy has ordered employees at the country’s two major railroads back to work so both can resume operations.
Saturday’s order means Canadian National will be able to continue operating the trains it restarted Friday morning, just over a day after locking out its workers. But Canadian Pacific in Kansas City likely won’t be able to resume operations until 12:01 a.m. Monday, when workers were ordered back.
Railways play a vital role in the economy. CPKC and CN deliver over C$1 billion (US$730 million) worth of goods every day and transport billions of dollars worth of goods between the United States and Canada each month. While both companies’ trains in the United States and Mexico continued to operate, the strikes caused significant disruptions. A number of smaller short-line freight lines that handle local deliveries continued to operate across Canada, but were unable to transfer shipments to either major railway during their inactivity.
The Teamsters union, which represents the workers, said it would comply with the Canada Industrial Relations Board order and send its members back to work, but would also move forward with a legal challenge to the arbitration order.
“This CIRB decision sets a dangerous precedent. It tells Canadian businesses that big companies only have to shut down for a few hours, which will cause them short-term economic hardship, and the federal government will step in to break a union,” said Paul Boucher, president of the Teamsters Canada Rail Conference, which represents more than 9,000 engineers, conductors and dispatchers at both railways.
“The rights of Canadian workers have been significantly diminished today,” Boucher added.
Labour Minister Steven MacKinnon ordered the lockouts ended just over 16 hours after they began because government officials could not bear to watch the economic disaster unfold if the railways remained closed.
MacKinnon acknowledged the board’s decision in a post on the social media platform X and said he expects the railways and employees to return to operations as soon as possible.
Across Canada and the United States, businesses have said they would quickly face a crisis without rail service, as they rely on freight railways to deliver their raw materials and finished goods. Without regular deliveries, many businesses could be forced to reduce production or even close.
Canadian National trains resumed Friday morning, but the union threatened to go on strike Monday morning. Saturday’s order reverses that strike threat. CPKC workers have been on strike since the lockout began Thursday morning, and the railway’s trains have remained idle.
“While CN is disappointed that an agreement could not be reached at the bargaining table, the company is pleased that this order effectively ends the unpredictability that has negatively impacted supply chains for months,” the railroad said in a statement. “CN remains focused on getting freight moving again as safely and efficiently as possible.”
The CPKC officially ended its lockout after Saturday’s order and asked workers to return for the day shift Sunday. But union spokesman Christopher Monette said workers who have been on strike will not return to the CPKC until the Monday deadline set out in the order.
The CPKC said it wanted to “restart the Canadian economy as quickly as possible and avoid further disruptions to supply chains.”
Rail companies have said it could take several weeks to fully recover, as they began phasing out their networks more than a week ago, leaving shipments stranded at customer loading docks and ports across the country.
The previous contract, which expired late last year, will remain in effect while the arbitration process plays out, and the board has ordered the unions not to further disrupt operations during that time.
Negotiations between CPKC and CN broke down over issues related to workers’ work schedules and contract rules aimed at preventing fatigue. Both railways had proposed changes to the system of paying workers based on kilometres travelled and hours worked.
The railways said it would make it easier to provide predictable leave, but the union resisted, fearing the changes could erode important fatigue protections and jeopardize workplace safety.
Canadian National and CPKC said they offered wage increases in line with other recent rail agreements. CN said its engineers earned about C$150,000 a year, while its conductors earned C$121,000. CPKC said its pay was comparable.
At CN, a dispute also erupted over the union’s desire to expand its system of temporarily relocating workers to other regions in the event of staff shortages. The union did not want CN to have the power to disrupt families, but the railway said the system was voluntary and already in place in some locations.
As Canadian railways struggle to reach agreements with their union, major U.S. railways have reached a series of deals in recent days.
CSX announced the first agreements Wednesday, months before the current contract expires and before the start of the traditional national bargaining process that typically lasts years, and then announced seven more contracts Friday. In total, the new contracts cover more than half of the railroad’s workforce. Norfolk Southern and BNSF followed suit, announcing four agreements each Friday with some of their 13 unions.
The deals will help the U.S. rail industry avoid the kind of fraught labor dispute that brought it to the brink of a strike two years ago before Congress and President Joe Biden stepped in to force a contract.
