Two agricultural groups say the uncertainty around a possible a strike of workers from CPKC and CN Rail is negatively affecting Canada’s reputation as a reliable exporter, and if workers walk off the job, it would come at a time when harvest is in the very early stages.

Executive Director of the Western Grain Elevator Association Wade Sobkowich says a strike now is terrible timing, adding with hindsight a strike would have been better around May, considering a large amount of the previous year’s crop had been moved by that point “and companies were given a lot of notice.”

“They started winding down operations, they started talking to their customers, they started deferring sales just to anticipate a work stoppage of some length on both CN and CPKC in May, and then that didn’t happen, but it had consequences because of the actions taken to prepare for it, right? So even the threat of a strike has consequences, even if a strike doesn’t actually happen.” he added.

Members of Teamsters Canada Rail Conference (TCRC), the union that represents CN and CPKC rail workers, voted in favour of a strike on May 1 and would have been in a legal strike position on May 22, however on May 19, former Labour Minister Seamus O’Regan ordered the Canadian Industrial Relations Board (CIRB) to review whether there are critical shipments that must continue during a strike and if they were stopped would that jeopardize the health and safety of Canadians. “Because of the delay at the CIRB, the union had to take the unusual step of asking members to reauthorize strike action.” said TCRC in a news release from June 29.

Friday is when the CIRB will announce details of their review.

On Monday, both railway companies met with current Labour Minister Steven MacKinnon and Transport Minister Pablo Rodriguez and committed to separate contract talks with the union on Wednesday. “Since the beginning of negotiations, CN’s goal has always been and continues to be to negotiate in good faith with the Union to reach a mutually beneficial agreement that maintains safety and stability for its team, customers, and North American supply chains. CN has made multiple offers to the TCRC that we believe address employee issues. We also believe that a negotiated outcome is best for all involved and are eager to get back to the bargaining table. ” said CN Rail in a statement on Wednesday.

Greg Northey, Vice-President of Corporate Affairs with Pulse Canada – a member of the Ag Transport Coalition – claims both sides have committed to negotiate through to August 15. “So unless something drastic happens, we do know that August 15 would be the earliest that we would potentially see that 72 hour strike notice,” says Northey, “the other uncertainty, and we’ll see this tomorrow, is the Industrial Relations Board may ask for some period of a cooling off period, which would basically mean that a strike cannot happen until the end of that cooling off period, so that could be 30 days which would push the potential date for a strike to happen in September. Again a lot of uncertainty; this is quite a serious potential repercussions here if you have both railways going down, especially for grain.”

Sobkowich says if workers walk off the job, the hope is to have it resolved as soon as possible to ensure the railways resume full operation before getting into the thick of harvest.

The federal government has been adamant to let both sides get a deal done, rather than issue back-to-work legislation. Sobkowich says Ottawa should step in, but knows they won’t because of the political ramifications. “We have the Liberals and the NDP that have a supply-and-confidence agreement, we have an election that’s going to have to happen probably within a year or just over a year, and we have governments that are pandering to the labour side of the equation for votes, so they’re very, very reluctant to do anything that interferes with the collective bargaining process, and for that reason I doubt we’re going to see anything heavy handed come from this government…behind the scenes they have been and probably will continue to try and put pressure on the parties to come to an agreement…but I don’t see them introducing back-to-work legislation or anything like that.”

Sobkowich says there should be alternative ways to resolve labour disputes so it doesn’t disrupt traffic vital to the Canadian economy. Northey also said there have been conversations in the past about finding alternative ways to ensure something like this doesn’t happen again, from making railways an essential service, to implementing the aforementioned back-to-work legislation, to looking at the labour process and see whether “there is enough of a driver for the two parties to come to a negotiated agreement within the time frame.”

Northey went on to say both sides have had lots of time to negotiate a deal. Talks started at the end November 2023 and the main sticking points have been crew scheduling and fatigue management. “Is there a process that can be put in place at least from the federal government’s standpoint to try and get the two parties to negotiate in good faith in a better way with a bit more of a pressurized environment, where you have arbitration that would be mandatory at certain checkpoints along the way,” Northey adds, “there’s a lot of things that can be started to look at in that sense to get this process working in a more dynamic way.”

Northey and Sobkowich believe Canada’s reputation as a reliable supplier has been negatively affected as countries see the labour dispute unfold.

Sobkowich says there are financial consequences such as vessel demurrage – a fee that must be paid when cargo remains at a port or terminal for longer than the agreed free time period specified in a shipping contract – and contract extension penalties. From a reputation perspective, Sobkowich said Canada is viewed as a “last resort for purchasing product because of all the disruptions we have.”

Northey says a strike or a disruption in the supply chain in Canada has happened more often than not over the last several years and each time it happens “it takes a little bit of the shine off of Canada.”