Three men standing in a warehouse managing ending inventory counts

Canada’s Liberal government is taking proactive steps to address the possibility of a strike by seeking a review from the federal labor-relations board regarding the transportation of certain goods in the event of a rail strike later this month.

Labor Minister Seamus O’Regan’s referral to the Canada Industrial Relations Board could potentially delay the commencement of a strike by over 9,000 members of Teamsters Canada at Canadian National Railway and Canada Pacific Kansas City. With more than 90% of union members voting in favor of a strike, tensions are mounting as the strike could commence as early as May 22.

The union is currently engaged in negotiations to renew three collective bargaining agreements with the two railroads. O’Regan’s filing of the request underscores concerns about the potential impact of a simultaneous strike at both railroads on the health and safety of Canadians.

Under Canadian labor laws, the government has the authority to seek the board’s intervention to ensure the maintenance of certain services during a strike to prevent immediate risks to public safety or health. The looming strike has raised concerns about the delivery of critical goods, such as propane, which is essential for heating homes in rural communities and for agricultural purposes.

While Teamsters Canada is reviewing the minister’s referral, they have affirmed their commitment to complying with any directives issued by the Canada Industrial Relations Board, particularly concerning safety-critical needs. Meanwhile, both Canada Pacific Kansas City and Canadian National are eager for swift resolutions to the negotiations, emphasizing the need for certainty in the Canadian economy and North America’s supply chains.

Business groups have warned of the significant disruptions a rail strike would cause in the supply chain network, particularly impacting manufacturers heavily reliant on rail transportation. With contingency plans being made by companies like Nutrien, Canada’s largest fertilizer producer, the looming strike could potentially affect second-quarter sales volumes.

Minister O’Regan has reiterated the government’s stance against using back-to-work legislation, emphasizing the importance of resolving disputes through negotiations. The repercussions of last summer’s strike at Canada’s Pacific Coast ports serve as a stark reminder of the economic impact of prolonged labor disputes, with authorities estimating a nearly 1 billion Canadian dollar reduction in GDP.