MONTREAL, (May 18, 2005) — It’s business as usual today for CN Rail’s freight services as the company and the union representing 1,700 train engineers reached a tentative deal at the 11th hour to avoid a nation-wide strike.

Teamsters Canada Rail Conference and CN announced just before a strike deadline of midnight tonight that they have reached a tentative five-year deal. Mediators appointed by Transport Canada were working feverishly all day Tuesday, trying to get the two parties to agree to a new collective agreement in principle.

A strike would have thrown freight operations across the country off track, although CN had claimed it had contingency plans in place to mitigate any disruptions. About 1,490 of the locomotive engineers work for the freight service.

Toronto and Montreal were also bracing for commuter chaos this morning. Almost all of Go Transit services — six of seven lines in Toronto are operated by CN — would have been shut down, leaving 150,000 commuters no choice but to hit the highways. A strike would have also left another 36,000 users of Montreal’s Agence metropolitaine de transport looking for transportation.

The wording of the proposed five-year agreement, retroactive to Jan. 1, 2004, is still being worked out. Details of the contract are being withheld pending ratification by TCRC’s membership.

It has been reported that the engineers wanted wage and benefits improvements. Their previous agreement with CN expired at the end of 2003.

“I am pleased that CN and the TCRC were able to resolve outstanding issues and reach a new collective agreement without labour disruption,” E. Hunter Harrison, president and chief executive officer of CN, said in a statement. “This allows all of us at CN to remain focused on our customers and their transportation needs.”

It was unlikely CN could afford another massive strike. A year ago, 5,000 CN clerical, customer service, and intermodal yard employees — about one third of CN’s total workforce — went on a month-long strike, disrupting freight movement and shipping ports across Canada.

— with files from CP