CPKC, CN Rail both threaten lockout if labour deal isn't reached by Aug. 22

Both of Canada's national railways are now threatening to lock out employees if their separate labour negotiations with Teamsters Canada aren't resolved by 12:01 a.m. on Aug. 22.

CN Rail is formally calling onthe federal government todeploy binding arbitration in the company'sdispute with Teamsters Canada.In a media release, CN Rail said it is making the request to "protect Canada's economy."

CN said that if the dispute isn't resolved soon,it will have "no choice" but to begin a phased network shutdown, concluding with a lockout.

Canadian Pacific Kansas City (CPKC) saidin a media release it is issuing its lockout notice publicly to give customers andsupply chainstime to plan for awork stoppage. The rail company adds that it hasoffered to enter binding arbitration with the Teamsters.

In an email to CBC News, Teamsters Canada public affairs director Christopher Monette called the the threat of alockout "unexpected and needlessly antagonizing."

"With at least thirteen days of negotiations still ahead, this move represents an unnecessary escalation that goes against the principles of good faith bargaining that CN and CPKC claims to uphold,' Monette said.

The news follows a decision by the CanadaIndustrial Relations Board (CIRB)that CN Rail and CPKCwill not be expectedto maintain service in the event of astrike or lockoutbecause rail serviceis not considered"essential" under the Canada Labour Code.

The roughly 9,300 employees represented by Teamsters Canada at the two railways now have a strike mandate.The CIRB has ordered a 13-day cooling off period for both sides anda strike can't take place now beforeAug. 22.

Back in May, then-labour minister Seamus O'Reganaskedthe CIRBto look into whether serviceshould be maintainedduring a strike or lockout.

In its ruling, released Friday, the CIRB said that while what constitutes an "essential service" might seem self-evident, the Canada Labour Code's definition is specific.

The CIRBsaid it had to decide whetheran interruption of rail servicewould result in an immediate, serious threat to public health and safety under the law.

The board concluded that a work stoppage would not present an immediate threat to public safety because previous work stoppages involving the parties presented no such threat, and no party brought forward convincing evidence to the contrary.

"There is no doubt that a work stoppage at CPKC/CN would result in inconvenience, economic hardship and, possibly, as some groups and organizations have suggested, harm to Canada's global reputation as a reliable trading partner," the CIRB decision says.

"While such possible harm is by no means insignificant, these are not factors that are to be considered by the Board when addressing a referral under section 87.4 of the [Canadian Labour Code]."

Posting on the social media platform X, Labour Minister Steven MacKinnon said the parties involved have a responsibility to Canadians.

"I call upon the parties to stay at the bargaining table and continue holding productive and substantive discussions that meet the needs of this moment. A negotiated agreement is the best way forward," he wrote.

MacKinnon met with the parties on Aug. 4. At the endof that meeting, he saidthe parties had agreed to restart negotiations on Aug. 7, accompanied by federal mediators.

CN Rail said the union hasnot "engaged meaningfully" since talks resumed.

Beforethe rail companies announcedtheir lockout intentions, Teamsters Canada indicated it would provide 72 hours' notice of any strike action.

"From the very beginning, rail workers have only ever sought a fair and equitable agreement. Unfortunately, both rail companies are demanding concessions that could tear families apart or jeopardize rail safety. Rail workers have fought for a safer and more humane industry for decades, and we will not accept moving backwards," said Teamsters Canada Rail Conference president Paul Boucherin the statement.

Business groups call on Trudeau to act

The Business Council of Canada released a lettercalling for immediate federal intervention to stop a labour disruption on the railways. The letter was co-signed by nearly 100business groups and industry associations, and is addressed to Prime Minister Justin Trudeau, MacKinnon and Transport Minister Pablo Rodriguez.

"Rail is the backbone of the Canadian economy. Businesses of all sizes and in all sectors rely on rail to deliver goods that are essential for their operations and the employment of millions of Canadians," Business Council of Canada president and CEO Goldy Hyder said in an emailed statement.

"In addition to the overall harm to the economy and jobs, a national work stoppage would also drive up prices for essential goods at a time when Canadians are facing affordability challenges."

In their letter, the Business Council says goods worth $380 billion areshipped on Canada's railways every year.

The Canadian Manufacturers and Exporters (CME), which also signed the Business Council letter, iscalling on the House of Commons transport committee to hold an emergency meeting next week to study the impacts of a railstoppage on the broader economy.

CMEsaysa rail work stoppage would cost manufacturesan average of $275,000 daily due todecreased output and increased expenses.