COMPETITION WATCH: CN looking to have conductors strike declared illegal

MONTREAL, Que. Canadian National Railway is looking to have the strike by its conductors and yard-service workers, which started this weekend, declared illegal.

About 2,800 members of the United Transportation Union employed by CN walked off the job early Saturday after negotiations in Montreal broke down.

CN moved quickly to file a complaint with the Canada Industrial Relations Board within hours of the announced strike. In the complaint CN claims the union’s pressure tactic is against the law.

The UTU International, which is the certified bargaining agent for the employees, has not authorized this strike, CN spokesperson Mark Hallman told the media.

The strike does not have the authorization of the unions international president, who is based in the U.S. However, Canadian representatives of the union have shot back that not having such authorization does not affect the legality of the strike.

There is definitely a dispute internally with the Canadian portion as compared to the American parent, the union’s chief negotiator, Rex Beatty acknowledged. But he told the media that what you have to look at is the constitution of the union cannot supersede the law.

Before negotiations broke down, the United Transportation Union was believed to be seeking a 40-minute lunch break on nine-hour shifts instead of the current 20-minute break. It also wanted seeking a 4.5% per cent wage increase over two years, and 4% in the final year of the contract.

CN called the UTUs wage demands excessive, adding they were 40 per cent higher than the increases CN negotiated in recent collective agreements for a comparable three-year period.

CN also said the UTU’s final offer on lump sum bonus payments – C$1,000 per year over the three-year period – was three times greater than the other recent agreements.

The average 2006 annual wage increase in major collective agreement settlements in the private sector in Canada was 2.1 per cent. The transportation industry average wage increase was also 2.1 per cent, according to CN.

In 2006 average annual UTU employee earnings were C$75,000, with 25 per cent of the UTU membership in Canada making more than C$90,000 annually, according to CN.

“We are prepared to negotiate a fair and equitable settlement with the UTU in the same way we’ve done with our other unions. But such a settlement must be economically sustainable and maintain the company’s competitiveness in the transportation marketplace,” said E. Hunter Harrison, president and chief executive officer of CN

Meanwhile, CN plans to continue its freight operations across Canada during the dispute, with management personnel performing union jobs. After the first day of the strike the railway reported that its freight network across Canada remained fluid. The UTUs Beatty, however, predicted the system would eventually come to a grinding halt.
The Canadian Wheat Board, is the largest rail shipper in Western Canada, and is reportedly concerned the dispute could result in delays for its clients. The board’s President and CEO Greg Arason told the Winnipeg Free Press on Saturday that he expects that some trains won’t make it.

It’s definitely a major concern for us. We have been in a backlog situation with shipments to the West Coast. We already have ships waiting, and this will make it worse.

New negotiations have not been scheduled between the two sides .

CN and the UTU have agreed during the conductors’ strike to maintain normal commuter rail operations on CN lines in Toronto and Montreal. Service in both cities continued today with no disruptions.

Excluded from strike action are UTU members employed on CN’s Northern Quebec Internal Short Line, Algoma Central Railway in northern Ontario, and Mackenzie Northern Railway in northern Alberta.

— with files from the Globe & Mail