CN Rail Lockout Leaves U.S. Trade Stranded

Many hours after the Canadian labor minister told a labor board to review his request for binding arbitration and to restart rail operations, with regard to the CN rail lockout. The CNBC has effectively learned that both the railroad companies and the worker’s union have been called. This was done for individual management conferences with the board for the CN rail lockout.

Canada’s Labor Minister Steven MacKinnon said at at press conference that he was “confident” the Canada Industrial Relations Board (CIRB) would accept his referral.

“Negotiated agreements have and always will be the best way forward,” a statement from MacKinnon said. “Collective bargaining is how the strongest, longest lasting deals are made – deals that are good for unions and employers alike.”

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With regard to the CN rail lockout, recently MacKinnon’s office told CNBC that the CIRB gets to decide whether to move forward with the request.

The highly integrated trade relationship between the Canadian and U.S. economies has left billions worth of cargo. This is in limbo after over 9,000 freight rail workers represented by the Teamsters Canada union were locked out by Canadian National Railway (CN) and Canadian Pacific Kansas City (CPKC). This was after months of failing negotiations.

Therefore, keeping the CN rail lockout in mind, the CNBC has reached out to CIRB for comment. Also, the MacKinnon’s office told CNBC that it can take up to 24 hours for the CIRB to announce its decision.

What Did the CN Rail Lockout Do After MacKinnon’s Comments?

Shortly after MacKinnon’s comments, both the Canadian railroads decided to put a hold on their CN rail lockout has announced their plans to restart operations.

The CN told CNBC that they have ended their lockout. In a statement, the company wrote, “While CN is satisfied that this labor conflict has ended and that it can get back to its role of powering the economy, the Company is disappointed that a negotiated deal could not be achieved at the bargaining table despite its best efforts.”

The CPKC also said it was preparing for a “safe and orderly resumption” of operation. Plus, it also added that it “will follow the order of the CIRB once it executes the Minister’s direction.” They have not lifted their lockout.

“The Canadian government has recognized the immense consequences of a railway work stoppage for the Canadian economy, North American supply chains, and all Canadians,” said Keith Creel, CPKC president and CEO. “The government has acted to protect Canada’s national interest. We regret that the government had to intervene because we fundamentally believe in and respect collective bargaining; however, given the stakes for all involved, this situation required action.”

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Both railroads told CNBC it will take at least several days. This is required to clear out the buildup of freight. This is because it takes time to ramp down and ramp up operations.

The Teamsters Canada Rail Conference told CNBC that picket lines would remain in place. This would be while they reviewed MacKinnon’s referral and the CIRB’s response. Plus, they consulted with their legal counsel to determine next steps.

“By resorting to binding arbitration, the government has allowed CN and CPKC to sidestep a union determined to protect rail safety,” the statement said. “Despite claiming to value and honour the collective bargaining process. The federal government quickly used its authority to suspend it, mere hours after an employer-imposed work stoppage. This action mirrors their earlier interference this year, where they used the CIRB to stifle bargaining for months,”

Along with it, the Teamsters Canada confirmed to CNBC they met with the CIRB Thursday night. It would also again on Friday morning to participate in their case management conference on the CN rail lockout.

Conclusion

The CN rail lockout has been called off. However, the CN rail lockout shows that rails are a large component of logistics for companies. This is from Dow Chemical to automakers in Detroit like Ford and General Motors. This is hinted towards the using of rails to transport auto parts. Plus, retailers such as Walmart, Target, Nike, Procter & Gamble and Canada Goose also import some of their goods. This is done into Canadian ports which are then transported by rail and truck.