The Harper government is expected to introduce back-to-work legislation on Monday after negotiations between Canadian Pacific Railway Ltd and its striking locomotive engineers and conductors fell apart over the weekend.
CP Rail and the union representing 4,800 workers who have been on strike since Wednesday, confirmed that talks broke off Sunday afternoon with little hope of resumption.
"With the mediator withdrawing and the federal minister releasing the parties this afternoon, the legislative process can now commence," said Ed Greenberg, a spokesman for CP Rail.
Earlier in the day, Labour Minister Lisa Raitt said she still hoped the parties could agree on a process that would end the strike, but made clear she would not wait long.
Pensions, as well as work rules and fatigue management remained major points of contention in the bargaining process.
Teamsters Canada Rail Conference, which represents workers at CP (TSX:CPR) as well as its chief competitor Canadian National Railway (TSX:CN) among others, blamed the rail company for the stalled talks.
"Unfortunately, the company negotiated in bad faith despite Minister Raitt's wishes," said Doug Finnson, the union's vice-president.
"Canadian Pacific was hiding behind the federal government since the very beginning of the process."
But CP Rail said it was only fair that the union agreed to a deal similar to the one the they have in place with CP's primary competitor _ Canadian National.
"The real issue is the reluctance of the Teamsters to agree to pension provisions comparable to those provided to employees represented by the Teamsters at other Canadian railways," Greenberg said in an interview.
"We were simply seeking the same agreement to insure CP can remain competitive."
Raitt said earlier on Sunday that government officials have been talking with impacted industries, farmers and the mining sector, and the reports are that the strike is "starting to actually affect their operations."
"That's the kind of national economic significance we are looking for in order to intervene," she told CTV's Question Period.
"What we're talking about is the prolonged effect of a strike, about what happens for seven days, eight days, nine days, and that's when you start seeing some really significant effects on the economy."
The minister gave notice of intention to intervene shortly after Wednesday morning's walkout halted the company's freight train service across the country, meaning she can table the bill as early as Monday and strikers can be ordered back to work later in the week.