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Federal Minister of Labour Lisa Raitt has met with CP Rail union leaders as the deadline nears for a strike.

Sean Kilpatrick/The Canadian Press/Sean Kilpatrick/The Canadian Press

Officials with Canadian Pacific Railway and the union representing nearly 5,000 of its workers met with federal Labour Minister Lisa Raitt Tuesday in the hopes of avoiding a strike.

"The union understands the government wants us to continue bargaining and get a deal, and that's what we're going to do," said Douglas Finnson, vice-president of the Teamsters Canada Rail Conference.

Mr. Finnson described the meeting with Ms. Raitt as "very positive," but said he couldn't comment on the specific topics that were discussed.

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The major points of contention are pensions, some work rules and fatigue management, he added.

The workers could legally walk out a minute after midnight local time on Wednesday.

CP spokesman Ed Greenberg said the company is willing to proceed into binding arbitration or extend the negotiation period if a deal isn't reached by the deadline.

"Meetings are continuing, so that's a positive sign for our company," he said.

A strike would halt shipments of grain, fertilizer, coal and other goods CP moves along nearly 24,000 kilometres of track in Canada and the U.S. It would also have an impact on some commuter rail routes in the Toronto, Montreal and Vancouver areas.

"Commuter and inter-city passenger rail is one component of our large Canadian network, and without the resources in place, it is simply not possible to run reliable and safe commuter service," said Mr. Greenberg.

He added a work stoppage could have ripple effects on other railways that connect to the CP network.

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In a release, Ms. Raitt urged CP management and the union to come to an agreement as quickly as possible.

"Our government is concerned that a work stoppage would have a negative effect on Canadian businesses and families, and the economy," she said. "That's why I have invited the parties to attend a working summit in hope that we can avoid any disruption of services."

George Smith, a former CP vice-president of industrial relations who now teaches at Queen's University, said he hopes Ms. Raitt doesn't intervene.

The labour minister stepped in to halt a strike at Air Canada earlier this year that would have inconvenienced March Break travellers.

Smith said that experience should have taught Ms. Raitt that "you can't legislate peace" and that she should stand back to allow the collective bargaining process to work.

"I'm a firm believer in the process working. I think I've heard enough from both sides that they realize what's at stake," said Mr. Smith, a labour relations expert at the Queen's School of Policy Studies.

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"There's a lot at stake. And generally when there's a lot at stake, rational people at a deadline find a way to resolve their differences."

The strike threat comes at a time of major changes at Canada's second-biggest railway.

A bruising months-long proxy fight with the railway's biggest shareholder culminated last week in Fred Green's exit as CEO.

New York hedge fund Pershing Square Capital Management argued the railway was lagging its peers under Mr. Green's leadership and that a change was necessary.

Mr. Green and five other board members stepped down hours before the company's annual general meeting last Thursday after it became evident shareholders had voted overwhelmingly for director nominees on Pershing's slate.

Teamsters' Mr. Finnson said the union has not yet met with Mr. Green's interim replacement, Stephen Tobias. He said the management shakeup has not affected the bargaining process one way or the other.

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Pershing Square CEO Bill Ackman told shareholders at the annual meeting that change would not happen overnight, but that CP could become one of the best railways in the world.

The railway's new leadership will have a tough time balancing shareholders' high expectations against the labour challenges the railway is up against, said Mr. Smith.

"In a certain sense, the new management is boxed in by their declaration of an economic revival for CP," he said. "The shareholders don't see that. They see new people who promised great things and here's the first test of it. Only it came a little sooner than anyone expected."

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