Preventing a rail labour disruption
Joint letter to the Right Honourable Justin Trudeau, P.C., M.P., Prime Minister of Canada, The Honourable Steven MacKinnon, P.C., M.P., Minister of Labour and Seniors and The Honourable Pablo Rodriguez, P.C., M.P., Minister of Transport and Quebec Lieutenant about the importance of preventing a labour disruption to Canada’s railway system
Re: Potential Labour Disruption in Class I railways
Dear Prime Minister and Ministers:
We are writing to urge you to immediately intervene and do everything necessary to avert a disruption in Canada’s Class I railways.
A concurrent or sequential work stoppage at both major railways will leave Canadians with access to fewer goods and products, driving up prices and exacerbating affordability challenges. A failure to act swiftly will also put the livelihoods of millions of workers in jeopardy.
A disruption to our railway system will have an immediate impact on thousands of businesses from coast to coast and to commuters in several major urban centres. All of Canada’s ports, logistics and warehouse operators, and suppliers will be affected, while a prolonged stoppage will quickly lead to shortages of supplies for numerous industries, forcing businesses to suspend their operations and furlough their employees. Factoring in the millions of Canadian jobs that would be impacted, the magnitude of the disruption is daunting.
Our international reputation and relationship with our trading partners is also at stake. Canada’s railways transport $380 billion worth of goods annually – that’s over $1 billion each day – and account for half of the country’s exports. A prolonged railway strike will also surely weaken Canada’s negotiating position in advance of the renewal of the Canada-United States-Mexico Agreement in 2026. A loss of confidence from our most important trading partner would take years to repair.
The uncertainty around the potential of a nationwide rail strike has already forced businesses across the country to adjust their operations (see Appendix).
We are respectfully asking that you safeguard the well-being of Canadians and the country’s reputation as a reliable trading partner by ensuring that a disruption to our national railway system does not occur.
To support this effort, we would like to propose a meeting with you and a select group of association leaders as soon as possible. This meeting would provide an opportunity to discuss our concerns in detail and to explore how we, Canada’s business community, can support the government in preventing any potential disruption.
Thank you for your attention to this urgent matter.
Sincerely,
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Cambridge Chamber of Commerce British Columbia Trucking Association
Canadian Chamber of Commerce Business Council of Canada
Cap-Acadie Chamber of Commerce Canadian Agri-Food Trade Alliance
Chamber of Commerce Brantford-Brant Canadian Association of Petroleum Producers
Chamber of Commerce for Greater Moncton Canadian Association of Recycling Industries
Chetwynd Chamber of Commerce Canadian Automobile Dealers Association
Cold Lake Regional Chamber of Commerce Canadian Canola Growers Association
Consort & District Chamber of Commerce Canadian Cattle Association
Fort Nelson & District Chamber of Commerce Canadian Construction Association
Greater Kingston Chamber of Commerce Canadian Corrugated and Containerboard Association
Greater Niagara Chamber of Commerce Canadian Federation of Agriculture
Greater Saskatoon Chamber of Commerce Canadian Federation of Independent Business
Halton Hills Chamber of Commerce Canadian Fluid Power Association
Hamilton Chamber of Commerce Canadian Food Exporters Association
High River Chamber of Commerce Canadian Franchise Association
London Chamber of Commerce Canadian Fuels Association
Madoc & District Chamber of Commerce Canadian Home Builders’ Association
Manitoba Chambers of Commerce Canadian International Freight Forwarders Association
Mississauga Board of Trade Canadian Kitchen Cabinet Association
North Bay & District Chamber of Commerce Canadian Manufacturers and Exporters
Port Hope & District Chamber of Commerce Canadian Paint and Coatings Association
Prince George Chamber of Commerce Canadian Pork Council
Quebec’s Federation of Chambers of Commerce Canadian Produce Marketing Association
Quinte West Chamber of Commerce Canadian Rental Association
Sarnia Lambton Chamber of Commerce Canadian Sugar Institute
Saskatchewan Chamber of Commerce Canola Council of Canada
Surrey Board of Trade Chamber of Marine Commerce
Thunder Bay Chamber of Commerce Chemistry Industry Association of Canada
Tillsonburg District Chamber of Commerce Conseil de la transformation alimentaire du Québec
Tri-Cities Chamber of Commerce Electro-Federation Canada
Truro & Colchester Chamber of Commerce Fenestration Canada
Tumbler Ridge Chamber of Commerce Fertilizer Canada
Windsor-Essex Regional Chamber of Commerce FETCO
Yorkton Chamber of Commerce Food & Beverage Atlantic
Food and Beverage Canada
Food and Beverage Ontario
Food & Beverage Manitoba
Food, Health and Consumer Products of Canada
Food Producers of Canada
Forest Products Association of Canada
Freight Management Association of Canada
Global Automakers of Canada
Global Cold Chain Alliance
Grain Growers of Canada
Hearth, Patio & Barbecue Association of Canada
I.E. Canada
Independent Contractors and Businesses Association
Medtech Canada
Mining Association of Canada
National Maritime Group
Nature and Outdoor Tourism Ontario
New Car Dealers Association of B.C.
Ontario Craft Brewers
Pets Canada
Private Motor Truck Council of Canada
Pulse Canada
Quebec Employers Council
Quebec Hemp and Cannabis Industry Association
Responsible Distribution Canada
Retail Council of Canada
Shipping Federation of Canada
Southern Interior Construction Association
Truck Training School Association of Ontario
Western Canadian Shippers’ Coalition
Western Grain Elevator Association
Wheat Growers Association
Wood Manufacturing Cluster of Ontario
Appendix
- Canada’s railways transport approximately $380 billion worth of goods annually, supporting approximately 50% of Canada’s GDP.
- A work stoppage will directly impact the movement of over $1 billion worth of goods per day, not accounting for broader economic disruptions.
- Shutdowns of commuter rail services will have a profound impact on major urban centers such as Toronto, Vancouver, and Montreal, severely disrupting the daily routines of thousands of Canadians.
- Public health impacts, though difficult to quantify, include risks like compromised drinking water treatment due to halted chemical shipments.
- No other modes of transport can effectively replace the high-volume and capacity to safely move hazardous products by rail.
- Frequent supply chain disruptions impact Canada’s ability to compete in global markets and damage our reputation as a reliable trading partner.
| Sector | Impact | Canadian Industry says: |
| Agriculture (Grain) | Could devastate the grain sector during critical planting and harvest periods. | Grain Growers of Canada: “We are entering harvesting season, a critical time for grain farmers across Canada. A stoppage in shipping will directly impact the bottom line of producers, risk food spoilage, and cause substantial economic losses across the agricultural sector.”
Western Grain Elevator Association: “A work stoppage of any length of time means lost shipping opportunities that will never be recovered. Shippers and exporters who cannot move grain, their customers who are waiting for product to arrive in the country of import, grain producers who are not paid because they cannot deliver, and Canadians in general, are the ones that suffer.” |
| Agriculture (Livestock, Perishable Goods, and Operations)
|
Could impact livestock slaughterhouse capacity, loss of perishable goods and food waste, as well as interruption to operations through an inability to heat facilities. | Canadian Federation of Agriculture: “A prolonged rail disruption could result in a backlog of livestock slaughterhouse capacity which could in turn have negative impacts on supply chains and animal welfare.
Based on previous experiences, it could also result in loss of high-value perishable agriculture and agri-food products, at a time when Canadians at home and abroad are increasingly concerned with food security. Interruptions to the delivery of propane would also have significant impacts on farmers’ ability dry grain and heat their barns, greenhouses, and other agricultural growing structures.” |
| Agri-Food
(Cold Storage) |
Could lead to food waste and added refrigeration, energy, and logistics costs. | Global Cold Chain Alliance: “The cold storage supply chain is reliant on the efficient flow of goods, with disruptions in one part of the chain having ripple effects both upstream and downstream.” |
| Automotive | Due to the industry’s heavy reliance on rail, disrupted services will impact the automotive supply chain, the retail supply of new vehicles and the supply of critical auto parts for repair and maintenance. | Global Automakers of Canada: “The automotive industry in Canada has faced ongoing labour disruptions at Canada’s ports and elsewhere in the distribution system. Consumers ultimately pay the price through increased wait times for their vehicles and potential increased costs, as companies seek workarounds for an unreliable transportation network. A coordinated rail strike will do nothing to alleviate these problems.”
Canadian Automobile Dealers Association: “Canadian families and businesses rely on the auto sector for almost every facet of modern life and the modern economy. Since the pandemic, auto supply chains are struggling to catch up, and disruptions impacting new vehicles sales and parts will hurt consumers and businesses that rely on the auto sector for transportation.” |
| Construction and Building Supplies | Impact on the supply of crucial construction and wooden building materials. | Forest Products Association of Canada: “Impacts on production are likely to occur within less than a week, with the threat of complete mill shutdowns and furloughing close behind. Even a mill shutdown would generate approximately $1 million [in costs] per day.” |
| Drinking Water | Risk to public health due to disrupted supply of water treatment chemicals like chlorine. | Chemistry Industry Association of Canada: “The implications of this are far-reaching. The most pressing issues, however, will be impacts linked to the disruption of chlorine shipments to Canadian municipalities to support the preparation of clean drinking water.” |
| Fertilizers | Risk to food security due to delayed or missed shipments of fertilizer during peak application seasons. | Fertilizer Canada: “Canada’s fertilizer is used by Canadian farmers and exported to over 75 countries, playing a crucial role in global food security. We depend on Canada’s Class 1 rail network to move nearly 30 million tonnes of Canadian fertilizer products to export markets and domestic farmers each year. Any delayed or missed shipments can impact crop yields, especially during the peak spring and fall application seasons.” |
| Food, Health and Consumer Products | Shortages of critical consumer staple products, particularly in rural and remote communities. | Food, Health and Consumer Products of Canada: “As rail is utilized for most long-haul shipments going to Western Canada and the Atlantic provinces, there will be guaranteed delivery delays for retailers. Those delays will be felt most acutely by northern and remote communities, and result in product shortages on many food staples, over the counter medication, baby food, and infant formula.” |
| Manufacturing | Wide-spread operational disruption and financial impacts | Canadian Manufacturers & Exporters: “A recent survey of 226 manufacturers shows the devastating impacts a stoppage will have on Canada’s industrial economy:
· 66% of manufacturers say a strike will have severe consequences on their operations. · 92% of manufacturers expect delivery delays, 76% expect increased costs, 57% expect reduced sales and 49% say it will reduce competitiveness. · Manufacturers will incur an average financial impact of $275,000 each day of a stoppage (decreases in revenues and increases in expenses).” |
| Small Business | Broad economic impacts across various sectors due to disrupted operations. | Canadian Federation of Independent Businesses: “Work stoppages at CN and CPKC could be devastating for small businesses across Canada. Critical infrastructure, such as railways, are necessary for sending goods to markets or receiving much needed inputs.” |
| Transportation Fuels | Interrupted access to a reliable supply of liquid transportation fuels, which drive Canada’s economy and ensure Canada’s energy security. | Canadian Fuels Association: “The integrated fuel supply chain relies heavily on uninterrupted daily rail service, both for the receipt of feedstock and blending components (i.e., crude oil, ethanol, biodiesel and process chemicals), and for the delivery of petroleum products (i.e., gasoline, diesel, jet fuel, heating oil, asphalt, propane), and chemical feedstocks across the country.” |
| Trucking | While some freight could be shifted to trucks, there is simply nowhere near enough capacity in our transportation network to compensate for a shutdown of the rail network. | Private Motor Truck Council of Canada: “PMTC members produce and/or supply such products as groceries, fuel for vehicles and heat, hardware, blood for medical purposes, pharmaceuticals, medical gases, and many more essential items. Private fleets heavily use rail networks to help move these products to different areas of the country, and the loss of both rail networks will have grave consequences on the health and safety of Canada’s population.” |
