Human Resources Committee on Feb. 8th, 2007

[Sean Finn]

Broader than that, Canadian companies have to have the possibility, other than just to maintain their assets, to make sure they can serve their customers and maintain the economy.

That's why, in 1999, when the Canada Labour Code was amended, Mr. Sims clearly did not go to that point, saying we need a balance between these two areas—and I understand that. But these comments about scab workers in Quebec....

This is not a provincial debate, and a province is not the country and vice versa. But it's important that we realize here that to look at most Canadian companies as regulated by this law requires that we continue to maintain a level of service, which is important for the country.

If it requires that we have replacement workers, because in our case we need skilled workers and use managers, that's one issue. But I submit to you that we're not talking about CN. There are other industries in Canada that you might want to continue servicing people without having highly skilled people, and that's just a balance in the power.

So to answer your question, in CN's case, no, it would not be sufficient. We think the bill is flawed—

[Sukh Dhaliwal, Liberal, Newton—North Delta, BC]

But when I look at 95% of business in this country being run by small businesses...and I went to small businesses on this particular bill. In fact, they're happy because in British Columbia—I'm speaking from a British Columbia perspective—there was an NDP government, and then a free-enterprise government of so-called Liberals came in and didn't touch that legislation either.

When I went to the business community, they supported the union, because those small towns, including the aboriginal population, depend on those union towns. So I think making statements such as that is not fair.

I'm going to pass it to Mr. Savage for his time.

[Michael Savage, Liberal, Dartmouth—Cole Harbour, NS]

Do I have seven or eight seconds?

[The Chair, Conservative, Dean Allison]

Go ahead.

[Michael Savage, Liberal, Dartmouth—Cole Harbour, NS]

Let me finish on this point.

I may come back again, Mr. Finn, because I come from Halifax, and I'm very concerned that the Port of Halifax will be impacted by a work stoppage.

My question is a follow-up to Mr. Dhaliwal, in order to understand the extent to which CN can operate with managers and retirees. If the bill was explicit in saying you could use managers, and let's say that it allowed you to move them from establishment to establishment, which is not allowed now, could CN operate under those circumstances?

[Sean Finn]

Clearly we will always do what we can to make sure we serve the customers and not shut down a port. By using managers and retirees, you know...who knows what will happen in the future? That's one of the issues, obviously.

We also have unionized clerks who prepare waybills and customs documents. They're not necessarily highly skilled people, but you cannot send a train out of Halifax to Chicago without doing the customs work. That would be an example of where you want to make sure those trains can get through the border. I can load containers in Halifax, stop at the Canada-U.S. border, and not get through because I don't have customs documentation.

So I'll come back to my point. I have listened to quite a few of the hearings, and I think the Canadian Chamber of Commerce and other chambers in Canada have clearly said that you have to think beyond the railway here. What are the customers' needs here, and how do we make sure that the customers are served? Small businesses are customers of the Purolator business as well as CN, and those customers also require that we move their goods to market. It would be somewhat difficult to explain to a customer in Halifax who needs one container moved that we can't move their car through the customs border because we're missing documentation.

I think it goes to the point that this system is not broken today. We had a strike of the CAW in February of 2004, the first railway strike in the last 20 years that did not get solved by back-to-work legislation. After a 30-day strike they came back to work. We operated the railway. We served our customers. The parties came back and signed a new agreement.

You know, it does work. Last week the CAW, who two years ago were on strike, signed a new three-year agreement.

So my comment to you is that I don't think the provision under a federal statute requiring that we have the right or not to use replacement workers is required in the current environment in Canada. With all due respect, I do not share your view that small businesses aren't impacted by this. They are.

[The Chair, Conservative, Dean Allison]

Thank you, Mr. Savage. You're slightly over your time.

We're going to move to the Bloc now.

Monsieur Lessard, five minutes, please.

[Yves Lessard, Bloc, Chambly—Borduas, QC]

Thank you, Mr. Chair. I want to thank our guests for accepting our invitation.

I simply want to make a comment on Mr. Nicholls' remarks on workers' ability to judge the merits of the decision.

When it's said that they made the decision to strike because they didn't understand what the vote implied, I think that's quite contemptuous, particularly since, in that situation, we're talking about Aboriginal people. I've worked with Aboriginal people and they are people concerned about being able to communicate among themselves and to understand situations clearly. I've even seen them interrupt meetings that I've attended in order to hold group meetings among themselves so that they could be sure they had understood everything. So these are people who are concerned about clearly understanding things before making a decision.

I use that example to say that you can't rely on an argument such as yours to establish the validity of Bill C-257.

I very much like the viewpoint of Mr. Turnbull, who urges us to examine what's really essential. I don't think everything can be essential, and I think you'll agree with me on that. Otherwise, if Messrs. Finn and Turnbull, for example, told us that everything must be essential, all that would then remain for you to do would be to seek the abolition of the right to strike. But I don't think that's what you are arguing for today. So some things are not essential.

Based on experience observed in Quebec, there are key areas, including health, where there is a right to strike, but also essential services. However, those services are based on a relationship of understanding, first of all, as to what must be essential or not, and when the parties do not agree, a third party decides the matter.

I want to get a clear understanding because we'll have to take a position on this question. You two have argued to this effect, and you may intervene, as well as others. What should we favour between the two? Is this an approach whereby we agree on essential services with the union, or the right to replacement workers?

[David Turnbull]

I'm going to say that there's a false premise to that question. I have explained, in a brief statement, the ripple effect through the economy of a federal strike. It's important that we not interrupt the flow of goods and inventory to small and large companies—

[Yves Lessard, Bloc, Chambly—Borduas, QC]

Yes, I understood that.

[David Turnbull]

No, no, I'm getting to your question. I just have to put this into the right context.

It's important that we get those services there. I have spoken about a tremendous number of areas that are affected. I just used two examples. I used the auto sector and I used the health care sector.

First of all, I don't think your bill is fixable for two separate reasons. One is a technical aspect--that you would have to effect changes to so many bills in Canada, federal bills that are not referenced in the Bloc's bill--which I believe technically isn't addressable. Secondly, I'm going to say that the very nature of federally regulated companies and organizations is such that these are important services to the whole of Canada.

I don't believe there is a problem at this moment. When you look at the situation in Quebec, the number of days lost in strikes in Quebec under legislation that bans replacement workers, and you compare it with the federal experience, I am saying wait a minute, this is a solution looking for the problem. There is no problem.

[Yves Lessard, Bloc, Chambly—Borduas, QC]

You're missing a great opportunity to answer my question. You're answering with overall and philosophical arguments. However, I'm asking you a question about something very concrete. I followed you very well. Everything has a cascading effect. However, businesses don't all strike at the same time.

If I understand your logic correctly, there may be a strike at some point in the goods handling link or chain.

For that link, do you advocate that there one day be a mechanism for replacing by means of replacement workers, or rather a mechanism in which the parties will identify what is essential and what is not?

[David Turnbull]

Let's be very clear. This bill suggests that replacement workers would be anybody in the organization. It is very clear in the drafting of the bill in English, and that is the fact that it is only for conservation measures. Read your own bill. Read your bill. That's what it says in the bill.

[The Chair, Conservative, Dean Allison]

We're out of time.

Sorry, Mr. Lessard, that's just over the time.

We're going to move to Ms. Davies for five minutes, please.

[Libby Davies, NDP, Vancouver East, BC]

Maybe I can follow that up and help clear that up a bit.

First, it is certainly not a surprise to me—and I don't think to anybody else—that we have major employers and very large companies coming here today saying they don't like this bill, they don't want to see a change. In fact, it's not a surprise to me to hear BHP saying the sky is going to fall, and we might have to make another decision. That's something that always happens when there is a change in legislation.

I would point out that in B.C. and in Quebec, where this legislation has existed for many years, there has been no flight of investment, and companies keep operating. In fact, it has helped produce labour stability. There is a point of view there, but the future will show somewhat different.

The question I wanted to ask to both Mr. Finn and Mr. Turnbull is there's a perception that this bill will somehow stand on its own, and it is not attached to the Canada Labour Code. It is actually an amendment to the Canada Labour Code.

Mr. Finn, you said that in recent history there have been four strikes at CN. I'm curious to know whether or not CN has ever used section 87.4 of the Canada Labour Code, because that is the section called “maintenance of activities”. When you read it, it really is the designation of essential services.

To you, Mr. Turnbull, as well, when you say there is a problem with this bill because it doesn't allow you to deal with that in terms of ongoing measures, it talks about conservation, but in actual fact, the very next section in the Canada Labour Code, which is section 87, lays out the whole process for how either the company or the employer or the union can go forward to the board and have an agreement about what those essential services are.

This is a very important point, because I think some members of the committee believe there is no provision whereby these essential services can be sorted out and an agreement can be made. In actual fact, it is right there in the code. It is the very next section. You may not like the section, but has it been used by CN or by your company when you have actually sought those agreements to have those determinations made for maintenance and services, or what we call essential services?

[Sean Finn]

We have not recently. Again, in the first three strikes, back-to-work legislation was not an issue.

[Libby Davies, NDP, Vancouver East, BC]

It wasn't an issue.

[Sean Finn]

No, it wasn't an issue then.

In 2004, we reflected on it, mostly for GO Transit or for the transit authority in Montreal. To be able to do so, either the federal minister does so or the shipper can do so. A customer cannot, but I'll come back to that in a second.

More importantly, as you know, one of the criteria places the burden on the shipper—in our case, it's on CN—to demonstrate to the Canada Labour Relations Board that there's immediate danger to the safety or health of the public. There are no commercial criteria, so having the CLRB telling Alcan to shut down four smelters, including one in Kitimat and three in Quebec, because there's a railway strike in Canada is not a criterion to have that service determined as being essential. There's no demonstration that by not producing aluminum you're impacting the safety or health of the public. Obviously, that argument is hard to make in that case.

In the case of GO Transit, you have to demonstrate that by having a transit strike in downtown Toronto you are endangering public health, because effectively there will be so much gridlock in downtown Toronto that you cannot get an ambulance between an accident site and the hospital. That's pretty hard to make as a case. It goes to show that sometimes you have transit strikes in Toronto that are not tied to the railway.

To answer your question, we have not done so, but the better view of council is that the provisions provided for under section 87.4 are effectively restrictive and therefore cannot be used. Therefore, without prejudging the decision, it would most likely come to the view that no services of CN would be considered essential.

I submit to you that the reason is that there's no economic argument to reach such a conclusion. But if you make an economic argument that the impact of a railway strike in Canada will shut down the Port of Vancouver, the Port of Halifax, and any smelter, and that it would have a major impact on the automotive industry, then why do you think Parliament decided three times in a row—1974, 1986, and 1995—to enforce back-to-work legislation or at least arbitration? Parliament realized that there was an economic impact to the country of Canada.

[Libby Davies, NDP, Vancouver East, BC]

Parliament always has the ability to do that, or the right, and that's something we debate very closely. But the point here is that I think we're hearing again and again that there's no provision whereby essential services can be determined.

Certainly a strike has an impact. We all accept that. A strike has an impact both on workers who are on strike and their families, on the local community, and certainly on the employer, the company, the services, and the public. But the point here is—and I really want your agreement—that there is a provision whereby essential services....

It may not go as far as you want. Your job as the employer is to argue that, right? It's to say that “essential services” to you means X, Y, and Z. You go before the board and the union goes before the board, and you each make your case. But that provision does exist. That process exists. But I think there's some suggestion here that somehow it doesn't exist, when it does.

[The Chair, Conservative, Dean Allison]

It does, but it's very restrictive.

[Libby Davies, NDP, Vancouver East, BC]

That's what essential services are. Otherwise, you would be impacting the strike.

[The Chair, Conservative, Dean Allison]

That's all the time we have.

I know Mr. Morrison and Mr. Atkinson want a quick comment. We're just over time, so just give a quick response.

[Jeff Morrison]

I just wanted to clarify one of the premises of the question, though, Ms. Davies.

You mentioned that you're not surprised that the large employers are here making the points that we are making. To clarify, we are not a large employer. The Canadian Construction Association represents roughly 20,000 companies, of which 90% to 95% are small businesses with under twenty employees or less.

To meet the point that Mr. Dhaliwal made—that many small business are welcoming this bill—I can suggest to you that Mr. Atkinson and I are here not because this bill impacts construction, because we are not a federally regulated industry, but because many small business members of our association have asked us to come because they are fearful of the exact same repercussions, in terms of the trickle-down effect, that Mr. Turnbull has raised.

[The Chair, Conservative, Dean Allison]

Mr. Atkinson, you can make a quick last point.

[Michael Atkinson]

It's a very quick comment.

There is a provision in the code right now that allows you to go before the board and get a temporary ban on replacement workers. It's there. The case has not been made to amend the code. The burden of proof is on those who want to put an outright ban in there, but you have not made the case, and there is a provision in the code right now. Mr. Sims' group put that in to allow the union or whoever to go before the board and argue that, because of an unfair labour practice, a temporary ban should be put in place. It's there.