* Govt introduces back-to-work bill Monday
* Teamsters union walked off job on May 23
* Pension changes is major sticking point in talks
* CP Rail stock drops 2.1 pct in Toronto
By Randall Palmer and Nicole Mordant
OTTAWA/VANCOUVER, May 28 (Reuters) – The Canadian government
will force striking workers at Canadian Pacific Railway
back to work with fast-track legislation aimed at re storing rail
service by Thursday, La bour Minister Lisa Raitt said on Monday.
The government introduced the legislation in the House of
Commons on Monday to end a work stoppage by 4,800 locomotive
engineers, conductors and rail traffic controllers at CP Rail,
Canada’s second-biggest railway.
“From past precedent, we’d like CP Rail continuing to roll
on Thursday. But we’d like it sooner, quite frankly, and that’s
the message today,” Raitt said in Ottawa, flanked by Canada’s
ministers of transport, energy, agriculture and industry.
The unionized employees have been on strike since May 23
over pension issues and work rules, shutting down CP Rail
freight operations across Canada fo r nearly a week. T he latest
round of mediated talks between the company and workers broke
down at the weekend.
The government fears the strike could hurt an economy still
recovering from recession. Raitt has said a strike would cost
C$540 million ($530 million) in economic activity each week.
“It is very clear that the government of Canada must act now
to resume rail service at CP Rail, as the prospect of ratified
agreements in the short term is highly unlikely,” Raitt told the
House of Commons earlier in the day.
“Simply put … the strike can’t go on. We need to get the
trains running again.”
An accelerated back-to-work bill will become law after it
passes through the House and Senate.
The majority Conservative government has resorted to
legislation to end strikes at Air Canada and the Canada
Post mail service, prompting criticism from the New Democrats,
the left-leaning opposition party.
“If employers know they can count on the government to
intervene on their side to put an end to collective bargaining,
then there is less need for them to have good faith negotiations
at the bargaining table,” said NDP finance critic Peggy Nash.
The CP Rail union, the Teamsters Canada Rail Conference,
said the two sides could likely reach a deal if CP backed down
on its pension plan demands.
“They don’t want to do that because they want to take the
money from our pension plan and they want to give it to the
shareholders,” Teamsters chief negotiator Doug Finnson told
reporters in Ottawa.
CP wants to reduce pension plan funding by 40 percent, the
union says. CP has said it needs to cut legacy pension and
post-retirement benefits to bring them in line with the rest of
the industry. The railroad says it has contributed C$1.9 billion
to its pension plans in the past three years due to funding
shortfalls.
SEEKING NEW ROUTES
Companies across a range of industries have scrambled to
find alternative ways to ship their grain, coal, fertilizer,
autos and other goods while CP trains sit idle, and some
industry groups have urged the government to step in.
The Canadian Vehicle Manufacturers’ Association said on
Monday its members, which include General Motors of Canada, Ford
Motor Co of Canada and Chrysler Canada, were incurring extra
logistics costs of C$100,000 a day due to the strike.
The strike is also frustrating grain handlers. Companies
such as Cargill Ltd, Richardson International
Limited, Archer Daniels Midland Co and Bunge Ltd
are crushing canola at a record pace, producing vegetable oil
and meal to feed strong global demand.
“It’s causing some anguish because we need all the rail
capacity we can with the larger crush volumes and larger rates
of export,” said Bob Broeska, president of the Canadian Oilseed
Processors Association.
The Canadian Wheat Board, which holds a monopoly on
marketing wheat and barley from the 2011/12 crop marketing year,
has said the strike affects up to 162,000 tonnes of grain
shipments per week.
Miners who produce potash, a globally sought after crop
nutrient, mostly use CP for exports. Canpotex, jointly owned by
producers Potash Corporation of Saskatchewan Inc
, Mosaic Co and Agrium Inc ,
ships some 40,000 to 50,000 tonnes of potash by rail each day.
But Agrium spokesman Richard Downey said the company was not
yet contemplating any slowdown in potash production at its
Vanscoy, Saskatchewan mine.
“If the strike is for a week or two, it’s not a big issue.
If it goes beyond that, it becomes an issue for all the potash
producers.”
Potash Corp has also not slowed production at this stage, a
company spokesman said.
Raitt said CP’s larger competitor, Canadian National Railway
, has tried to help CP customers but it was “too much”
for the bigger railroad.
CP’s routes are mostly in western Canada and in the United
States. The U.S. operations are not affected by the strike
although any freight destined for Canada is being held up.
CP’s stock price was down 2.1 percent at C$75.54 on the
Toronto Stock Exchange on Monday. The shares have risen 0.8
percent since the strike started.
The strike comes at a difficult time for CP, whose chief
executive and chairman quit 11 days ago after losing a boardroom
dust-up with the company’s largest shareholder.
The shareholder, Pershing Square Capital Management, has
vowed to improve CP’s operating performance, which is the
weakest in the industry.
