Canada Labor Board Orders Rail Employees Back to Work

(Bloomberg) -- An independent tribunal in Canada has ordered workers at the country’s two largest railways to get back on the job and to engage in binding arbitration to resolve a dispute that has snarled North American supply chains.

The Canada Industrial Relations Board agreed on Saturday to Labor Minister Steven MacKinnon’s request for arbitration as well as an extension of the workers’ expired contracts and for the railways to resume operations “forthwith.”

“The board has concluded that, in this case, it has no discretion or ability to refuse to implement, in whole or in part, the minister’s directions or modify their terms,” the CIRB said in its decision, signed on behalf of Chairwoman Ginette Brazeau. The decision was unanimous.

MacKinnon had argued that a return to work was needed because Canadians’ livelihoods, safety and communities were at stake.  

Canadian National Railway Co. and Canadian Pacific Kansas City Ltd. shut down operations Aug. 22 after talks with the Teamsters Canada Rail Conference failed. Following MacKinnon’s request to the board, CN trains started rolling again early Friday, but CPKC workers went on strike. A strike notice was issued to CN by the Teamsters for 10 a.m. on Monday.

The labor board’s ruling clears the way for the railways to fully resume operations.

However, the Teamsters are likely to appeal the decision to the Federal Court. The union has accused the government of violating the Charter of Rights and Freedoms by denying the right to strike and undermining the foundation on which labor unions work to improve wages and working conditions.

The Teamsters union, which represents nearly 10,000 workers at the two railways, said in an emailed statement Friday evening that it would “lawfully abide by any decision from the CIRB.”

CN, CPKC and the union didn’t immediately respond to a request for comment.

Business groups in Canada and the US had been calling on the Canadian government to intervene, as the lockout disrupted their interconnected supply chain and thwarted C$1 billion ($736 million) in goods transported by train each day.

Commodities like coal, wheat, fertilizer and lumber depend on the railways to transport product between Canada’s ports and the two countries. Collectively, the two companies account for 80% of the country’s rail network. 

Talks between the two parties have stalled over arrangements to address scheduling and crew fatigue issues. The previous collective agreements expired at the end of 2023.

--With assistance from Monique Mulima.

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