The prospect of work stoppage on Canada’s railroads is looking more and more likely to take shape next week. Canada’s labor minister announced yesterday that there will be no immediate intervention from the government in the ongoing labor dispute between the rails and the unions.

In response to this announcement, both the Canadian National Railway (CN) and Canada Pacific Kansas City (CP) have begun to implement a phased shutdown of their Canadian networks. August 22nd has been announced as the date a work stoppage would start if the two (2) sides are not able to come to an agreement. The CN and CP have both stated that they will begin to lockout workers on that date if there is no agreement in place. Additionally, the Canadian Government has decided to remain on the sidelines as the two (2) sides negotiate. This will likely change in the event of an actual strike. Canada’s rail system supplies critical infrastructure goods that impact day-to-day living. A long-term strike is not expected. 

Any prolonged shutdown of rail operations is expected to have a significant impact on both Canadian and US supply chains. In particular, freight transiting via Prince Rupert and Vancouver would feel the impact. Vancouver is Canada’s busiest container port and acts as a gateway on the Asia-US trade. Vancouver has already been experiencing backlogs and congestion.

Depending on how the situation unfolds, there is the potential for heavy congestion in Vancouver. There is also the potential for work slowdowns or stoppage at the port in sympathy with the rails. Options to move cargo out of Vancouver can ultimately be discussed with your RIM representative. Carriers are putting contingency plans in place over the weekend.  

RIM is monitoring the situation closely and will continue to keep you updated on developments. Please reach out to your RIM representative should you have any questions.