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Issue #589

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2014 Media Kit
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Canadian shippers crippled by delays, CN rail strike

By: | at 07:00 PM | Breakbulk & Projects  

Leo Ryan, AJOT

For shippers in Canada relying on rail to get their products to domestic centers or to ports for overseas destinations, it’s been a nightmare in recent weeks, provoked by a disastrous combination of bad weather and an untimely labor crisis.

First, the West Coast was hit by the worst snowstorms and most violent winds seen in two decades, starting in late December and only recently subsiding. Mounting cargo delays followed, with notably up to 7,000 containers grounded at one point at Deltaport, the largest box terminal at the Port of Vancouver.

Then more disaster for shippers struck on Feb. 9 when negotiations broke down over wages and working conditions between CN and the United Transportation Union (UTU) representing 2,800 conductors and yard service employees. The next day, a strike was launched that CN claimed was illegal because it was not authorized by the US headquarters of the union.

It was later qualified as legal, however, by the Canada Industrial Relations Board, and the Ottawa authorities appointed a mediator to hopefully resolve the dispute that had quickly sparked, raising production cutbacks, lay-offs and port congestions from coast to coast.

‘I want the dispute ended in hours, not days,’ said Labor Minister Pierre Blackburn, who warned that he intended to introduce back-to-work legislation in Parliament if the two sides did not rapidly find a compromise agreement. As this edition of AJOT was going to press, Blackburn indicated he would introduce legislation paving the way for work resumption the week of Feb. 26.

Although the Conservative government does not command a majority in Canada’s Federal Parliament, the opposition Liberal party looks poised to support legislation on a pressing national economic issue.

Internecine union divisions

Adding to the confusion surrounding the strike has been the infighting within the union. The UTU’s international headquarters in Cleveland fired four Canadian general chairpersons amid allegations the ousted leaders had engaged in maneuvers to steer Canadian locals to the rival Teamsters Union.

One of those dismissed also claimed that CN had actually blocked conductors and yard workers from returning to their jobs. This was angrily denied by CN.

Some 350 workers even defied their own union, returning to their jobs on Feb. 21, rather than end up with a legislated contract.

In an unusual move in such labor conflicts, CN issued a statement on Feb. 21 declaring that, in light of the ‘intense internal divisions’ within the UTU in Canada, the railway acknowledges the need for Canadian government legislation to end the labor dispute.’

After recalling that CN’s preference has always been to achieve new labor agreements through collective bargaining, President and CEO E. Hunter Harrison urged the Federal Parliament, in this case, to ensure ‘quick passage’ of back-to-work legislation.

CN management employees have been filling in for striking conductors to keep freight trains rolling ’ but obviously relatively far from near full capacity. Union officials argue that there are considerable safety risks involved, with many managers lacking sufficient training and experience for often dangerous tasks.

Mounting shut-downs and lay-offs

In both eastern and western Canada, shippers have been anxious for the dispute to end.

The Association of Canadian Manufacturers and Exporters said the impact was widespread, with many companies no longer stockpiling parts and materials.

Ford Canada shut down its assembly plant in St. Thomas, Ontario, because parts supply shortfalls prevented it from keeping production rolling.

‘It’s starting to bite,’ said Garry Fedchum, president of the Automotive Parts Manufacturers Association. ‘It’s like a bunch of dominoes falling down.’

In addition to auto shippers, grain, forest products and chemical shippers complained of slowdowns.

‘The potential economic damage from a prolonged strike is now quite evident,’ said Maureen Fitzhenry, spokesperson