OTTAWA – Canada’s automotive industry is calling for improved labour relations in the country’s rail sector following significant disruption caused by an ongoing walkout by 10,000 rail workers on Canada’s two rail networks.

The Canadian government on Thursday halted a lockout with an order requiring binding arbitration at the Teamsters Canada Rail Conference (TCRC) and the Canadian National (CN) and Canadian Pacific Kansas City (CPKC) railroads. However, the Teamsters have challenged the order with respect to CPKC and are now, according to spokesman Marc-André Gauthier, “formally on strike, no trains are running.”

The union is considering doing the same with CN Services and could give the company a 72-hour strike notice: “We are not happy with the government’s decision. It is undemocratic to let bureaucrats decide what is in our contract,” Gauthier tells WardsAuto.

The two companies’ rail lines stretch across the United States (and into Mexico in the case of CPKC), and even if the union had accepted the arbitration decision, it would likely have taken several days for rail service to resume on both networks. While the work stoppage has not directly affected these companies’ domestic rail services, shipments to and from Canada have been halted. https://cnebusiness.geomapguide.ca/ And https://www.cpkcr.com/en/our-advantage/connecting-a-continent

Matt Blunt, president of the American Automotive Policy Council (AAPC), told WardsAuto that any prolonged work stoppage would “severely impact the North American automotive supply chain, which is critical to the U.S. auto industry, its domestic manufacturing supply chain, and the hundreds of thousands of people employed in the industry.”

“AAPC has been in touch with the Biden administration on behalf of our member companies regarding the potential impact on the U.S. automotive industry and its employees.”

David Adams, CEO of Global Automakers of Canada, says of his 22 non-Detroit-based members, including Toyota, Honda, Nissan and others: “Virtually all finished vehicles are shipped by rail. The majority of production from Canadian plants goes to the United States – 85% by rail.”

Pointing to a “series of strikes” in Canada’s transportation sector over the past three years, Adams says, “We have a real labor relations problem in our transportation service in Canada. Given that we are a nation that relies on trade, that is not an enviable position. The country is being held hostage.”

He says that over the past 20 years, Canada has seen rail outages lasting between two and 10 days, but “we’ve never had a situation where both rail lines were out at the same time.” So all of Canada’s businesses are putting pressure on the government, businesses and unions to find a solution, Adams says.

This could still involve binding arbitration after CN quickly announced the end of its lockout and the Teamsters initially announced an end to picketing. CPKC also ended its lockout, but the Teamsters went on strike instead and have been challenging the validity of the government order to this day.

Announcing the referral of the conflicts between CN and CPKC to the Canada Industrial Relations Board (CIRB), federal Labour Minister Steve MacKinnon said in Ottawa on Thursday: “We will investigate why conflicts keep occurring in the rail sector and what circumstances led to the parallel work stoppages… We want things to be predictable and reliable. That’s why we will investigate why these threats are happening.” https://www.cpac.ca/headline-politics/episode/railway-dispute-govt-orders-binding-arbitration-resumption-of-operations?id=508eadd5-cb9b-411f-90e3-c60ff081798d

The government acted after a year of wage negotiations failed to produce a solution. MacKinnon said the talks had reached an impasse.

Its binding award under section 107 of the Canadian Labour Code ordered the parties to return to work and extended the existing contracts until the arbitration was completed and a new contract came into effect.

Adams warns: “This cannot go on for long. It does not bode well for our international reputation. It is not practical to deliver vehicles by road. Dealers’ inventories will fall. If this continues, it will be difficult for them to stay in business.”

As for automakers, he says that factories that build 2,000 to 3,000 vehicles a day will “quickly run out of storage space” to accommodate the models: “Nobody wants to close a production line, but if you don’t have space to accommodate the vehicles, that becomes a problem.”

He says parts and components were mostly delivered to Canadian original equipment manufacturers by land, with the exception of a few smaller shipments sent by rail from the West Coast to manufacturing centers in Ontario.

On Thursday, Teamsters spokesman Christopher Monette accused the companies of “shutting down their own operations to break the union and pressure workers to accept these concessions.” He told WardsAuto: “They have acted without any regard for the impact on the auto industry, farmers and small businesses. Our workers want to reach a negotiated settlement.”

CPKC, meanwhile, says: “Throughout nearly a year of negotiations, CPKC has remained committed to doing its part to avoid this work stoppage,” adding: “TCRC leadership continues to make unrealistic demands that would fundamentally impact the railroad’s ability to serve our customers.” According to CN, conductors and train drivers currently work about 160 days a year when you add up on-duty and rest time, paid sick days, personal leave and existing rest and vacation entitlements. Conductors earn an average of 121,000 Canadian dollars (US$90,000) and train drivers earn 150,000 Canadian dollars (US$110,000), not including pension and health insurance benefits.