After months of tense negotiations, Canadian rail companies enlisted the government to block a strike, shutting down railworkers’ fight for safer conditions and better hours. The federal intervention sets a troubling precedent for future union talks.
Locked out railway workers demonstrate on August 22, 2024, in Brampton, Canada. (Ian Willms / Getty Images)
On August 22, Canadian rail workers represented by the Teamsters Canada Rail Conference (TCRC) spent a brief moment on the picket lines before the Canadian Liberal government intervened to end the work stoppages and force binding arbitration.
After months of intransigence at the bargaining table, the two corporations that make up Canada’s rail duopoly — the Canadian National Railway Company (CN) and Canadian Pacific Kansas City Ltd (CPKC) — locked out their workers, counting on government intervention to resolve the dispute in their favor.
It was a dark day for Teamsters rail members and for Canadian workers more broadly. The government had been delaying and frustrating these workers’ right to strike throughout the bargaining process, and when push came to shove, it didn’t hesitate to do the bidding of the rail giants.
This sets a dangerous precedent, in more ways than one.
The safety concerns raised by railworkers and their union during negotiations may not get the hearing they deserve in arbitration. Beyond the rails, employers will get the message: if your industry is important enough, the government will ensure you don’t have to take your workers’ strike threats seriously.
Work Intensification on the Rails
Over the past two years, railworkers across North America have been sounding the alarm about the connections between their working conditions and public safety. As work has become more intense, workers and communities in the path of rail lines have experienced deteriorating safety and increased risks from derailments.
In 2022, the United States narrowly avoided a national rail strike over these issues when President Joe Biden signed a bill preventing the workers from walking out. After the Norfolk Southern train derailment in East Palestine, Ohio, in 2023, rail safety and the grueling working lives of railworkers were again on the radar.
In Canada, similar issues abound.
Working hours has been a long-standing concern for the TCRC. Like their US counterparts, Canadian railworkers have focused on hours of work, rest periods, and rail safety in their recent negotiations with CN and CPKC. The companies have been pressuring the union to accept cuts to collectively bargained rest periods and reduced time off.
In May, Canada’s Transportation Safety Board finally reduced maximum train crew shifts from sixteen to twelve hours, addressing an abiding safety concern. In June, a Federal Court judge found Canadian Pacific guilty of contempt for forcing employees to work “excessively long” hours in 2018 and 2019, violating the Teamsters’ collective agreement.
As the Teamsters noted at the time of the Federal Court decision, the Transportation Safety Board of Canada has identified crew fatigue as a factor in at least thirty-two train derailments since 1990. The TCRC’s collective agreements provide working time and rest period protections beyond those stipulated by federal regulations. It’s these work rules that the companies had in their crosshairs.
Railworkers are tasked with operating trains that are much longer and heavier than in previous decades, while the volume of cargo handled by rail has grown exponentially. At the same time, the rail giants’ adoption of so-called precision scheduled railroading (PSR) has cut crew levels and rest time, putting workers and the public at risk from derailments and other accidents.
In fact, precision scheduled railroading was pioneered in Canada by the CEO of Canadian Pacific Railway, the predecessor to CPKC. Infamously, the staff cuts and work intensification entailed in PSR partly contributed to the Lac-Mégantic disaster wherein a derailment and runaway oil tanker exploded, killing forty-seven people in Quebec.
As the union argued through the dispute, it wanted to protect and improve hours of work rules and was willing to strike over it. The companies, on the other hand, characterized their efforts to extend working hours as “a more modern agreement.”
Fits and Starts During Collective Bargaining
Negotiations for new collective agreements covering the more than nine thousand Teamsters at CN and CPKC began to break down in February, as the companies tried to force concessions from union members. A contentious round of bargaining with both companies had been ongoing since the previous fall.
At one point in late February, CPKC attempted to circumvent the union by mailing out contract “options” directly to workers and refusing to provide an electronic version of the mailing to the union negotiating team. The union correctly understood this as disrespect for the collective bargaining process and filed a complaint against the company with the Canadian Industrial Relations Board (CIRB) for attempting “to bargain directly with and to unduly influence employees.”
The union then had to file a second unfair labor practice complaint against CPKC for unilaterally changing work rules related to rest periods and pay during bargaining, an illegal move.
Rather than bargain in good faith, the companies instead filed notices of dispute and requested a federal conciliator to assist with contract talks in mid-February, though no deal was reached during the conciliation period. This followed a familiar pattern — CPKC itself acknowledged that nine of the last ten collective bargaining rounds have involved the use of federal conciliators. Clearly, the rail giants have been driving a hard bargain for a long time.
Fed up with the companies’ refusal to budge, union members voted 98 percent in favor of striking in early May, signaling their determination to stand firm in their demands and take action if necessary.
Ending the Strike Before it Started
Before workers could walk out, however, then federal minister of labor Seamus O’Regan used an obscure section of the Canada Labour Code to preempt their strike on May 9.
As work stoppages loomed, O’Regan requested “clarity” from the CIRB concerning whether certain rail services could be deemed essential and thus maintained during a strike. Never mind that the Teamsters and the rail companies had already entered into “maintenance of activities” agreements and established that the rails were not such an “essential service.” According to the agreements, a strike on the railways posed no danger to public safety.
Despite this, the labor minister delayed a potential strike and introduced an additional bureaucratic hurdle into bargaining. O’Regan’s intervention effectively froze the timeline for strike action until the Industrial Relations Board could complete its investigation and issue a determination.
With the Teamsters’ strike threat temporarily neutralized, bargaining resumed with the union’s power predictably diminished. Indeed, following the minister’s directive to the CIRB, the companies seemed to grow more obstinate.
Union members, who should have been able to exercise their constitutionally protected right to strike after a difficult bargaining process, were left in limbo awaiting a decision from the board. When the Canadian Industrial Relations Board finally returned its decision in August, it found that the rails contained no essential services — just as the Teamsters expected. The rail companies quickly issued lockout notices, and workers hit the picket lines, but only briefly.
On August 22, mere hours into the stoppage, the new minister of labor, Steven MacKinnon, directly intervened to end the strikes and impose arbitration. MacKinnon employed the rarely invoked section 107 of the Canada Labour Code, which grants wide powers to the minister “to maintain or secure industrial peace and to promote conditions favorable to the settlement of industrial disputes or differences.”
Much to the chagrin of the union, the CIRB sided with the labor minister and complied with his direction to force binding arbitration.
As the Teamsters put it,
By resorting to binding arbitration, the government has allowed CN and CPKC to sidestep a union determined to protect rail safety. Despite claiming to value and honour the collective bargaining process, the federal government quickly used its authority to suspend it, mere hours after an employer-imposed work stoppage.
The Teamsters have since appealed the board’s decision in federal court — a case they have a good chance of winning — but the damage has already been done. With their right to strike suspended, workers have been railroaded into binding arbitration.
A Dangerous Precedent
The government’s interventions in this rail dispute raise several serious concerns.
First, throughout the negotiations, the rail employers remained steadfast in their desire to lengthen working time, despite concerns over worker and public safety. Ultimately, the companies forced a lockout as a last-ditch effort to extract these concessions. By imposing arbitration, the government let the rail bosses off the hook and may have put safety at risk in the process. Although these outstanding issues will be heard by an adjudicator, arbitration is notoriously mixed when it comes to settling nonmonetary disputes.
Second, as the TCRC president recognized, the government’s action “signals to Corporate Canada that large companies need only stop their operations for a few hours, inflict short-term economic pain, and the federal government will step in to break a union.” In other words, government intervention in work stoppages has a demonstrative effect. Coming to the aid of employers when they refuse to bargain only incentivizes further stubbornness. The rail giants modeled bad employer behavior, and the government rewarded them for it. Other employers will surely take note.
Last, the government’s final decision to put its thumb on the scale for the rail bosses was taken without even a semblance of democratic deliberation. Rather than table back-to-work legislation in Parliament — which would have been bad enough — the minister of labor ordered the Labour Board to end the strike by using a section of federal labor law that most union members have likely never heard of. In this way, the Liberals excused themselves from having to debate their actions in public.
The chilling effect this episode could have on Canadian labor relations is unpleasant to contemplate. No one should have been under the illusion that the Liberal government was on the side of workers and unions, but this blatant suppression is a stark reminder of where its loyalties lie.