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opinion

Locked-out CP Rail workers protest outside the Lachine Intermodal facility in Montreal, on March 20.Graham Hughes/The Canadian Press

Wade Sobkowich is executive director of the Western Grain Elevator Association

A labour disruption at Canadian Pacific Railway would have been devastating. Canada dodged a massive bullet. But we’re dodging these bullets far too often – and that’s a major problem for the country.

The time has come to put an end to rail work stoppages that can and should be avoided. Strikes or lockouts involving railways and their respective unions can no longer be resolved by holding shippers and the wider Canadian economy hostage.

Rail shippers throughout Canada breathed a collective sigh of relief in March after CP and the Teamsters Canada Rail Conference agreed to submit unresolved collective bargaining items to binding arbitration, thereby putting an early end to what promised to be a devastating disruption.

The premiers of Manitoba, Saskatchewan and Alberta recently issued a joint request calling on the federal government to make legislative amendments to the Canada Labour Code that would see rail transport designated an essential service that could not be interrupted by labour disruptions.

The past year has been one of the most challenging ones on record for Canadian grain producers, exporters and processors. A severe drought reduced grain production by almost 40 per cent. A combination of forest fires, flooding and generally poor rail service has resulted in grain shipments being significantly delayed. Those delays have all strained food supply chains throughout the country and have negatively impacted Canada’s reputation as a reliable global supplier of grains and oilseeds.

The vast majority of grain elevators and processing plants are serviced by only one of Canada’s two major railways, with approximately half of the facilities situated on CP lines and the other half on Canadian National Railway routes.

The CP labour disruption meant its facilities would be forced out of service, effectively shutting down 50 per cent of Canada’s grain handling and shipping capacity. Apart from adding to recent difficulties encountered by the sector, it also risked significantly exacerbating a global grain supply shortfall currently being caused by Russia’s invasion of Ukraine.

For more than a decade, a strike or lockout has occurred or been threatened at least annually at one or both national railways. On each occasion, Canada’s food processors and international customers are told that they may not receive the grain they need to manufacture food products that eventually make their way to store shelves. They are then left scrambling to determine how they will manage their operations and are forced to consider alternative (i.e. non-Canadian) sources of grain.

Operating in this perpetual crisis environment does nothing to improve Canada’s global reputation as a reliable trade partner. This becomes an even greater challenge when competing against other global exporting countries who typically have easier geography to traverse and shorter distances to travel to position products for export, as well as a milder climate and lower operating costs.

Some of those challenges are impossible to overcome. But others, such as rail service disruptions due to labour disputes or civil blockades, are avoidable and urgently need to be addressed.

Throughout the COVID-19 pandemic, the importance of maintaining robust food supply chains was plainly obvious. In fact, agriculture, food processing and rail transportation were identified as critically important infrastructure and were exempted from many regulatory restrictions in order to ensure their continued operation, failing which national security was at risk.

The fact that this critical infrastructure can be jeopardized, if not completely interrupted, every year because of labour issues is simply incongruent with its recognized importance to Canada.

Providing a framework for the fair and orderly resolution of labour disputes between railways and their unions through mediation and binding arbitration, and thereby avoiding the needless harm resulting from rail service interruption, has unquestionable merit – particularly if both parties truly believe their negotiating positions to be reasonable.

Concerns that such an approach threatens the integrity of labour relations fail to take into account the unique market dynamics of single-carrier rail service and are far outweighed by the harm caused to the Canadian economy by incessant railway disruptions.

The grain sector is part of a growing chorus of business groups across Canada urging the federal government to designate rail an essential service.

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