Canadian Underwriter

Strike or lockout possible for thousands of Canadian Pacific freight train workers Sunday

February 12, 2015   by Canadian Underwriter

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It is too early to predict the impact on Canadian supply chains if there is a labour disruption involving thousands of railway workers at Canadian Pacific Railway Company, but a union official suggested Thursday it “could get a little chaotic” in the event that a work stoppage occurs.

A strike or lockout – of locomotive engineers, conductors, trainmen and yardmen – “is possible as early as” Sunday, stated the union representing those workers – Teamsters Canada Rail Conference – in a press release Feb. 7.

“If necessary, CP plans to run a reduced service on our Canadian network, using qualified management crews,” a spokesperson for the Calgary-based railway wrote Thursday in an e-mail to Canadian Underwriter. “It is too early to say what that service might look like exactly.”

Two unions delivered strike notices to Canadian Pacific Railway

A wide variety of commodities – including wheat, corn, soybeans, canola, coal, petroleum, metals, potash, pulp & paper, lumber and vehicles – are transported by Canadian Pacific, in Canada and the United States.

Canadian Pacific accounts for about 35% of all Canadian rail transport revenues in Canada, while Canadian National Railway accounts for 50%, Transport Canada notes on its website.

Teamsters Canada – which is affiliated with Washington, D.C.-based International Brotherhood of Teamsters – is currently in talks with Canadian Pacific management, with the assistance of mediators from the federal labour department.

A Teamsters Canada spokesperson confirmed to Canadian Underwriter that the aim of those talks is to reach a tentative agreement by midnight Saturday night. If an agreement is reached, TCRC would then put that agreement to its members for a ratification vote.

Asked by Canadian Underwriter whether there is a possibility that negotiations could continue beyond midnight Saturday – without a strike or lockout – if no tentative agreement is reached, the Teamsters Canada spokesperson replied: “Not at this moment.”

“We can’t make any comments about the impact on the supply chain, but we know it could get a little chaotic in the first days of the strike,” the Teamsters Canada spokesperson said.

More than nine in 10 (93%) of employees voted “in favour of taking strike action in order to obtain a negotiated settlement with Canadian Pacific Railway,” Teamsters Canada said in a press release Feb. 7.

Teamsters members are not the only Canadian Pacific Railway employees who could be off the job Sunday.

Unifor (formed through the merger of the Communications Energy and Paperworkers and Canadian Auto Workers unions) also announced Thursday it issued a strike notice, to Canadian Pacific, for 12:01 a.m. Sunday. Unifor says it represents 1,800 Canadian Pacific employees who conduct safety inspections on all rail cars and locomotives, as well as maintenance and repairs.

In its investor fact book for 2014, Canadian Pacific noted that grain (including wheat, corn, soybeans and canola, as well as processed products such as meals, oils and flour) accounted for 22% of its revenues in 2013. At the time, Canadian Pacific was also serving eight pulp mills in British Columbia, Ontario and Quebec, and handled 66,000 carloads in 2013 of forest products. The railway firm was moving imported vehicles from the Port Metro Vancouver, as well as Canadian-produced vehicles moving to the U.S. from Ontario and vehicles produced in the U.S. and Mexico.

“We provide direct rail service to five of the eight southern Ontario auto producers, and service two others through transload facilities in the region,” the railway stated in its 2014 fact book.

In addition to serving 10 potash mines in Saskatchewan, Canadian Pacific ships also coal from Teck Resources’ mines, through terminals in Vancouver, to steel makers outside of Canada.