Canada on the Brink: Massive Railway Strike Could Cripple North American Supply Chains

A Canadian railway union strike is happening soon due to no meaningful negotiations. If the strike occurs, experts predict it will disrupt supply chains across North America.

Teamsters Canada Railway Conference (TCRC) announced a 72-hour strike notice against Canada’s largest railway companies, Canadian National Railway (CN) and Canadian Pacific Kansas City (CPKC), on Sunday.

TCRC plans to proceed with the strike on the 22nd if there is no significant improvement. CN and CPKC have suspended transportation services and banned hazardous materials in preparation for the strike.

TCRC criticized CN and CPKC for concentrating on stripping existing rights rather than fostering a positive labor-management relationship and respecting union members. They also pointed out that CN and CPKC have not adequately implemented work and rest period regulations (DRPR).

The union highlighted that its members are dealing with daily challenges and increasing unpredictability in their work schedules. Despite these issues, they pointed out that companies are not adhering to the Canadian Transportation Agency’s guidelines concerning requests for reset breaks.

CN claimed the union rejected its proposal for several new agreements to improve guaranteed days off, safety, wages, and work-life balance. They also mentioned that the union turned down a proposal to voluntarily agree to binding arbitration, which would involve an independent arbitrator determining the terms of the agreement.

CPKC countered that it maintains the “status quo” working rules. Furthermore, they claim to focus on competitive wage increases and renewing guaranteed three-year contracts.

Earlier, TCRC approved a strike against CN and CPKC through a member vote in May. About 9,300 workers from CN and CPKC participated in the vote, with over 95% in favor.

However, TCRC decided to postpone the strike at the Canadian government’s request until the Canadian Industrial Relations Board (CIRB) completes a national safety impact assessment related to the railway strike.

If the railway union strike occurs, it will significantly affect the Canadian automotive supply chain and the broader North American supply network. Global shipping company Maersk has already decided to stop accepting additional cargo destined for Canada that requires rail transport and exceeds the weight of large trucks.

Nick Little, the Railway Education Director at Michigan State University, expressed concern about the demands for responsiveness in the railway and automotive industries. He noted that the automotive sector, in particular, has extensively embraced just-in-time supply models, eliminating buffer stock at various supply chain stages.

He also predicted that strikes and transportation bans that included parts, subassemblies, and finished vehicles would significantly impact the automotive industry.