Work stoppage halts Canadian rail shipments
Rail traffic is at a standstill in Canada after the country’s two largest railroads locked out workers as part of an ongoing union dispute.
According to CNBC, the Canadian National Railway (CN) and Canadian Pacific Kansas City (CPKC) rail lines have locked out more than 9,000 members of the Teamsters union as of Thursday, Aug. 22, 2024. The companies and the union have been involved in contentious negotiations to reach a new contract agreement.
The two railroad lines claim they had been bargaining in good faith and made multiple contract offers with improvements to wages and working conditions before instituting the lockout.
The Teamsters say they are concerned over issues such as length of shift, scheduling, rest periods between shifts, and work-life balance. So far, the Canadian government has resisted getting directly involved but is urging the two sides to reach a compromise.
According to Moody’s, the stoppage could cost Canada more than $250 million per day and disrupt shipments of vital products. U.S. Department of Transportation figures indicate that rail shipments account for 14% of U.S.-Canada bilateral trade, which surpassed $380 billion from January to June 2024.
Read more CNBC coverage here.
U.S. avoids freight rail strike with legislation
A strike that would have halted nearly 7,000 freight trains and dealt a blow to the U.S. supply chain heading into the 2023 holidays was prevented in December 2023 with action from the federal government.
President Joe Biden signed legislation to impose a labor agreement between rail companies and workers, averting a strike that he had said would “devastate” the U.S. economy. It was estimated that the strike would have cost the U.S. economy an estimated $2 billion a day and cost as many as 765,000 Americans their jobs.
[READ MORE: Freight rail strike averted]
The signing came just days after, in a rare bipartisan vote, Congress approved a bill that forced the rail companies and employees to abide by a tentative agreement that the Biden administration helped to broker earlier in the year.
The agreement approved by the House and Senate and signed by Biden gives workers a 24% raise over five years, caps on health care premiums and one additional personal day. The Senate followed Congress in approving the bill, but it did not approve a House-passed measure to add seven days of paid sick leave to the agreement.
