CN, CPKC prepare to restart railways after Ottawa steps in to end stoppage

UPDATE: 3:45 p.m.

Canada's two biggest railways are preparing to get trains running again after Ottawa said it would step in to end a bitter labour dispute.

Canadian National Railway Co. says it has ended its lockout of workers that began earlier today and is to immediately begin a recovery plan.

The company says while it's awaiting a formal order from the Canada Industrial Relations Board, it made this decision in order to speed up the recovery of the economy.

It says it's satisfied the labour conflict has ended but is disappointed a negotiated deal could not be achieved.

Canadian Pacific Kansas City, meanwhile, says it's preparing to restart operations.

It says it will provide further details about timing once it receives an order from the board to impose final binding arbitration.

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UPDATE 2:23 p.m.

Labour Minister Steven MacKinnon says the federal government will ask the Canada Industrial Relations Board to end the lockout at the country's two biggest rail companies.

MacKinnon says he's asking the board to order a return to work and to impose binding arbitration.

He says the impacts of the work stoppage, which started last night, are being felt by all Canadians.

Canadian National Railway Co. and Canadian Pacific Kansas City Ltd. locked out 9,300 engineers, conductors and yard workers after the parties did not agree on new contracts before deadline.

Business groups have been urging the government to step in with binding arbitration or back-to-work legislation, warning of massive economic consequences that could cost an estimated $341 million per day.

NDP leader Jagmeet Singh said earlier on Thursday that his party wouldn’t support any interference in the bargaining process by the Liberals.

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UPDATE 1:20 p.m.

Labour Minister Steven MacKinnon is set to provide an update Thursday afternoon about the lockout at Canada's two biggest rail companies.

Canadian National Railway Co. and Canadian Pacific Kansas City Ltd. locked out 9,300 engineers, conductors and yard workers after the parties did not agree on new contracts before a midnight deadline.

While visiting a manufacturing facility in Sherbrooke, Que., on Thursday morning, Prime Minister Justin Trudeau said the government was working "to make sure that the right solution is found quickly for the economy."

A spokesman for MacKinnon said a news conference was scheduled in Ottawa at 4:30 p.m. E.T.

Business groups have urged the government to step in with binding arbitration or back-to-work legislation, warning that the shutdown will have massive economic consequences.

While the economic cost of the work stoppage is staggering, the lockout also comes at a time when all federal parties are courting the labour vote. Moody's warned that the work stoppage could cost the Canadian economy $341 million per day, with agriculture, forestry and manufacturing among the hardest-hit sectors.

The Conservatives, who have been taking steps to strengthen relationships with unions, voted earlier this year in favour of legislation that bans replacement workers at federally regulated workplaces. Leader Pierre Poilievre has been clear he's looking for the support of unionized blue-collar workers.

Jagmeet Singh said the New Democrats will not support back-to-work legislation or any interference in the bargaining process.

The NDP leader also criticized the companies for locking out their employees and said they should be bargaining with Teamsters Canada.

Speaking to reporters in Montreal on Thursday, Singh said the NDP will vote against back-to-work legislation even if becomes a confidence vote in Parliament.

The NDP agreed in 2022 to support the minority Liberal government on confidence measures in exchange for movement on key priorities, including pharmacare and dental care.

However, Singh said, it has been his party’s position since the "very beginning" that if Liberals were to bring in back-to-work legislation and call it a conference vote, "we will vote against that every single time." He also said New Democrats would considered the deal to be broken if a confidence vote were to happen.

If it opts to turn to back-to-work legislation, the Liberal government would need to seek support from either the Conservatives or the Bloc Québécois.

Neither party had commented about the lockout by mid-afternoon and neither answered questions from The Canadian Press.

The last time the Liberal government enacted such a law was in 2021, to end a strike by dockworkers at the Port of Montreal.

A spokesman MacKinnon said the minister was in meetings on the rail shutdown all day and was following the matter closely.

MacKinnon said Thursday on X that he had spoken to his American counterpart about the work stoppages and the importance of the rail sector to both countries.

American officials are tracking the situation closely.

The U.S. ambassador to Canada, David Cohen, said his State Department colleagues have expressed concern about the ramifications for cross-border trade.

"While the embassy does not take sides or intervene in Canadian labour disputes, we hope for a speedy resolution and encourage all the parties to remain at the bargaining table and to reach a settlement as quickly as possible," Cohen said in an emailed statement.

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ORIGINAL 5:42 a.m.

In a first for Canada, freight traffic on its two largest railways has simultaneously ground to a halt, threatening to upend supply chains trying to move forward from pandemic-related disruptions and a port strike last year.

In the culmination of months of increasingly bitter negotiations, Canadian National Railway Co. and Canadian Pacific Kansas City Ltd. locked out 9,300 engineers, conductors and yard workers after the parties disagreed on a new contract before the midnight deadline.

The Teamsters Canada Rail Conference has begun posting pictures to social media of workers from Halifax to Vancouver setting up picket lines.

The impasse also affects tens of thousands of commuters in Toronto, Montreal and Vancouver, whose lines run on CPKC-owned tracks. Passenger trains cannot run on those rails without the locked-out traffic controllers to dispatch them.

GO Transit warned Thursday morning that its service "may be busier than usual."

The regional transit service for southern Ontario’s Greater Golden Horseshoe region said rail service was suspended at Hamilton GO Centre and on the Milton line, which cuts through Mississauga to Toronto’s downtown Union Station.

In Vancouver, TransLink said West Coast Express service was suspended, while Exo said its Candiac, Saint-Jérôme and Vaudreuil/Hudson lines in the Montreal area would not be running.

Pressure from industry groups and government to resolve the bargaining impasse has been mounting for weeks, with calls to hash out a resolution likely to ratchet up further now the work stoppage has begun.

The companies haul a combined $1 billion in goods each day, according to the Railway Association of Canada. Many shipments were pre-emptively stopped to avoid stranding cargo.

Parties bargained late into the night Wednesday at hotels in Montreal and Calgary before talks broke off shortly before midnight.

Each side has accused the other of failing to negotiate seriously.

"The railroads don't care about farmers, small businesses, supply chains or their own employees. Their sole focus is boosting their bottom line, even if it means jeopardizing the entire economy," said Teamsters president Paul Boucher in a statement early Thursday morning.

Bargaining played out in separate negotiations between each company and the Teamsters, which represents 6,000 CN workers and 3,300 CPKC workers.

CN said it has negotiated in good faith over the past nine months.

"The company consistently proposed serious offers, with better pay, improved rest and more predictable schedules. The Teamsters have not shown any urgency or desire to reach a deal that is good for employees, the company and the economy," CN said.

CPKC called for binding arbitration, saying the union has made "unrealistic demands."

Business groups have also demanded the government step in by imposing binding arbitration and barring strikes and lockouts as the process plays out.

Prime Minister Justin Trudeau called on both sides on Wednesday to work out a deal at the bargaining table.

Affected industries include agriculture, mining, energy, retail, automaking and construction. U.S. railways have also had to turn away Canada-bound shipments.

Shippers south of the border also rely on Canada's two main railways, whose tracks run to the Gulf of Mexico and, in CPKC's case, to several Mexican ports.

Meanwhile, Canadian ports fear containers will pile up on the docks as cargo goes unmoved, causing congestion down the line and prompting some carriers to reroute to U.S. terminals.