Bill C-46 (Historical)

Railway Continuation Act, 2007

An Act to provide for the resumption and continuation of railway operations

This enactment provides for the resumption and continuation of railway operations and imposes a final offer selection process to resolve matters remaining in dispute between the parties.

Railway Continuation Act, 2007

[Jean-Pierre Blackburn, Conservative, Minister of Labour and Minister of the Economic Development Agency of Canada for the Regions of Quebec]

moved that Bill C-46, An Act to provide for the resumption and continuation of railway operations, be read the second time and referred to a committee.

Mr. Speaker, the Canada Labour Code and our labour legislation allow us to strike a balance between the parties' rights to collective bargaining and the use of tools such as strikes and lockouts. When the parties do not reach an agreement within a reasonable timeframe and the Canadian economy is seriously affected as a result, the government not only should act, but has a duty to act. We are at that point now.

As you are aware, the tentative settlement reached on February 24 between Canadian National and the United Transportation Union was not ratified by 79.44% of the employees. I therefore must introduce the Railway Continuation Act, 2007, today. This bill provides for the immediate resumption or continuation of the railway operations of the Canadian National Railway Company.

The members of this House know that the February strike at Canadian National by the 2,800 members of the United Transportation Union had an enormous impact. This work stoppage had serious economic consequences across the country. The Canadian Wheat Board, chemical producers, the Port of Vancouver, auto manufacturers, farmers, potash mines and forest and automotive industry stakeholders have all told us how the strike affected their operations.

It is hard for me to take this step today. I would have preferred it if the parties had reached an agreement themselves, and that is why I did everything possible to help Canadian National and the union in their negotiations. But as many members know, the negotiations were long and complicated, lasting 19 months. I would like to take a few minutes to describe the process.

The collective agreements in question cover 2,800 drivers, yardmasters, and trainmen and yardmen. Bargaining to renew these collective agreements has been taking place since September 1, 2006, when the notice to bargain was given. I appointed two conciliators on November 20, 2006, and meetings have been taking place since December 14. The collective agreements expired on December 31, 2006, and failing an agreement the parties were released from the conciliation process on January 19, 2007, that is, three months ago. I then appointed two mediators to try and help the parties to conclude an agreement before they acquired the right to strike or lockout. However, on February 5, 2007, the union announced that the members had voted in favour of a strike to support the union’s demands, and the strike began on February 10.

Canadian National management then attempted to continue offering essential services, such as food and fuel delivery in remote regions, but it was all very difficult. On February 20, I decided to send our senior mediator to Montreal and I asked the parties to work with her to try and reach an agreement. I am referring to Elizabeth MacPherson. Fourteen days into the strike, the parties found some common ground with our other mediator, Laurent Lessard, and Ms. MacPherson, and the workers went back to work. We appreciate the fact that they acted promptly for the sake of railway transportation operations and the resumption of economic activity. They did not delay and we took note of this.

However, last week on April 10, a majority of the union membership rejected the tentative settlement reached between both parties. CN rail workers have since resumed strike action, engaging in rotating withdrawals of service.

Many Canadian businesses struggling to recover from the last strike will once again face costly disruptions. We all know that in just a matter of a few days in February the strike was felt right across this country.

In the Pacific region, mill owners were faced with not having enough raw materials or no means of shipping their finished products. In the north, Canadian workers, owners and investors in the mining industry waited anxiously for much needed fuel. In the prairies, where grain owners have already been reeling from a difficult fall and winter season, the strike meant that no grain was moving.

In Ontario and Quebec, factories and industries struggled to find ways to manage having inventory accumulate while contending with slowing supply lines. In some cases workers were laid off or given reduced work schedules. Continuous uncertainty in the supply chain is the very element we are up against as a result of the rejection of the tentative agreement.

There seems to be little chance of ratifying an agreement at this time. The government and the millions of Canadians who have already been affected by the CN Rail dispute will not stand for any more disruptions to our economy and to our livelihood.

The legislation that we are moving forward today, the Railway Continuation Act, 2007, ensures the continued operation of CN Rail. This act also extends all previous collective agreements between CN and the UTU until the coming into force of new collective agreements to replace them.

The bill also provides for that the final offer selection process will be used to settle the issues in dispute by the parties. What is a final offer? Following three months’ negotiations between the parties, if there are still points of disagreement, the arbitrator will ask each party to make its offer, and the arbitrator will choose either the union’s or the employer’s proposals. There will not be an amalgam of the two proposals; it will be one or the other.

This forces the parties to reach an agreement. This is what we call the final offer. I repeat:, the arbitrator must choose between the employer’s final offer and the union’s. The arbitrator’s decision becomes the new collective agreement. It should be pointed out, however, that passing this bill does not in any way prevent the parties from continuing to negotiate and reaching an agreement. The bill actually expressly provides that the parties can at any time agree to conclude new collective agreements. We hope that the parties will continue to negotiate to resolve this conflict before the arbitrator has to decide the issue, but without paralyzing the economy and while continuing to work for everyone’s sake.

With this legislation, arbitration costs may be recovered in equal parts from the employer and the union. Furthermore, the legislation states that any contravention may result in fines of up to $1,000 for individuals, up to $50,000 for officers of both parties, and up to than $100,000 for the employer and the union if they do not respect the stated conditions.

The act would come into force 24 hours after it receives royal assent, making it possible for workers to be fully informed of its provisions and consequences. I would like to ensure that the members of this House truly understand that our government supports the collective bargaining process, which is fully covered by the current provisions of the Canada Labour Code. A settlement negotiated by the parties is always preferable to a solution imposed by the government. But when nothing works, it is our duty and our responsibility to act in the common interest and in the interest of the sound management of the economic well-being of our country.

The case before us is a good example of the importance of providing a balanced and stable legislative framework. The Canada Labour Code was thoroughly reviewed in 1999. Unions and employers were very involved in the exercise, which led to the amendments adopted in 1999. The current provisions of the code are the result of compromise and consensus, resulting in the well-balanced framework of the Canada Labour Code, part I. The results are evident: the government has not had to use back-to-work legislation since that time. Before the act was amended in 1999, this instrument of last resort— that is, back-to-work legislation— was used much more frequently. In fact, CN and the United Transportation Union have since renewed their collective agreement without a work stoppage.

In 2000, they reached an agreement through a conciliation process. Similarly, in 2003, an agreement was reached with the help of mediation. However, the current situation has become unique, which is why we must act. Railway operations are crucial to the Canadian economy and the well-being of all Canadians. Railway operations have become essential, not as defined by the Canada Labour Code, because this is not yet affecting the health and physical well-being of the public, but in the sense of the health of the economy. Railway operations play a crucial role in the functioning of Canada's economy. Additionally, our government is determined to ensure that Canada's reputation as a leader in the global economy is not tarnished, and that our country continues to be perceived as a place where businesses can depend on a railway network that is a reliable and efficient means of transport.

It is our responsibility to intervene when the stability of our economy and the livelihood of thousands of workers are at risk. Government intervention in this dispute is now inevitable. This is why we are proposing this bill here today. The provisions of the bill would allow for a fair and rapid resolution of the dispute. Our message is clear: we have made every possible effort to allow for settlement through collective bargaining, but we are not willing to stand by and watch this labour disruption jeopardize the Canadian economy.

I urge all members of this House from all political parties—the Liberal Party, the Bloc Québécois, the NDP—and independent members to support this position, in order to pass this bill as quickly as possible.

I would remind the House that, regardless of this bill, there is nothing to stop the two parties from reaching an agreement. If they manage to do so, that agreement would take precedence. We must take action. We cannot continue to endure rotating strikes. The 14-day strike in February meant $1 billion lost in exports. Thus, it meant $1 billion out of $5 billion for the month of February.

I would like to reiterate that we encourage Canadian National, the employees and the union to negotiate and reach an agreement themselves. We must take action in the interest of the healthy functioning of Canada's economy.

[Peter Julian, NDP, Burnaby—New Westminster, BC]

Mr. Speaker, the NDP cannot vote in favour of this bill because it gives CN managers a blank cheque. We have seen what this bad management has caused in communities across the country; I will come back to that later.

My question is simple. The government had a choice to make. We know full well that the safety of our railway is the major sticking point between the workers and the management of this company.

My question for the minister is simple. Has he talked to the Minister of Transport about resolving the railway safety problems that communities have been dealing with for years now? Have they tried to find solutions to satisfy the workers who are concerned about the growing number of accidents across the country?

Since the main problem is safety, did he talk to the Minister of Transport about what the government could do to resolve the safety issue? That is the problem. The problems raised by the minister are not the crux of the problem. This is a matter of safety in our railway operations. Communities have to deal with the accidents that occur across the country. Have there been discussions to resolve these differences, instead of simply telling the companies that we will impose what they want?

[Jean-Pierre Blackburn, Conservative, Jonquière—Alma, QC]

Mr. Speaker, what does the hon. member want? Would he like the Canadian economy to be paralyzed for months and months because of a strike, because from the union's standpoint at Canadian National, we know there was a dispute between the American union and the Canadian union? Would the hon. member like the economy to be paralyzed and for us to wait indefinitely?

People are writing in to us. Some of them may even come from his own riding.

This includes Potash Corporation of Saskatchewan, Sultran Ltd. in Calgary, Superior Propane in Calgary, Western Grain Elevator Association, West Fraser Timber in Vancouver, Nutrinor in Saint-Bruno, Keystone Agriculture Producers in Winnipeg, Tembec in Abitibi, Canpotex in Saskatoon, Canadian Chemical Producers' Association in Ottawa, the Canadian Federation of Agriculture in Ottawa and others.

Just yesterday our office received 78 phone calls from people asking us to please proceed with this. They need security in transportation and they need the economy going well. We answered the people from across Canada. We said that it was their responsibility, my responsibility and our responsibility to act for the health of the country

[Carole Lavallée, Bloc, Saint-Bruno—Saint-Hubert, QC]

Mr. Speaker, I have an important question to ask the minister about his bill.

When he appeared before the Standing Committee on Human Resources Development to speak against Bill C-257, one of his arguments went like this, “You can see how well balanced my current legislation on replacement workers in the Canada Labour Code is working. Since it came into effect in 1999, there has been no need to pass back-to-work legislation”.

I would like the minister to explain something to me. We still have the same legislation on replacement workers, which is not really any legislation at all. Employers only need to pretend to negotiate in order to hire as many scabs as they want. But that was the argument he used. He still has the same legislation today. There is still no anti-strikebreaker bill, unfortunately, but the minister is obliged to introduce back-to-work legislation.

[Jean-Pierre Blackburn, Conservative, Jonquière—Alma, QC]

Mr. Speaker, if the anti-strikebreaker bill that the hon. member introduced had come into force, the employees would not have been able to return to work between February 24 and April 10, even though the parties had reached an agreement in principle around February 24, because they would have had to wait for the results of the vote to be made known. We would have been without trains for two months.

How could the country function without trains? Would the hon. member please explain to the House why she could possibly want this to happen? Even though replacement workers can be used, it is not always easy to find them. People do not necessarily have the skills needed for the job. It is not easy to find people. That is why it is important to maintain a balance between employers and employees in the Canada Labour Code. It is working quite well.

Despite everything, though, sometimes particular situations arise where it becomes apparent that the parties do not want to reach an agreement and we cannot ensure that there will be good service for the economic health of the country and we have to assume our responsibilities. That is what we are doing here.

[Peter Julian, NDP, Burnaby—New Westminster, BC]

Mr. Speaker, the minister is talking about situations where there would be no trains and no service. But that is precisely what we have with all the problems we are seeing at CN because of bad management.

The government did not encourage talks with the Minister of Transport. That is absolutely absurd. So what have we seen for the last several weeks? No trains in Kamloops, Pickering, Montmagny or Fraser Canyon, precisely because of that bad management and lack of safety in the rail system.

What I am hearing from the minister is that the Conservatives have done absolutely nothing to settle the issue regarding those discussions and those disputes with the workers, who in fact want to have a safe rail system. The managers of the companies in the United States simply want to make big profits. So it is their responsibility to take measures that could have settled these disputes.

If I understand correctly, there has not been a single discussion about the question of safety and the escalating accidents we are seeing everywhere. What he is doing here is writing a blank cheque that will encourage more accidents, will encourage the stoppage and shutdown of the rail system across the country, because we will have even more accidents, since they have not solved the core problem.

Why have they not held a single discussion to solve the core problem in these disputes, which is the safety of our rail system?

[Jean-Pierre Blackburn, Conservative, Jonquière—Alma, QC]

Mr. Speaker, the Canada Labour Code allows employees to strike. It also allows employers to order a lock-out. That is the principle of balance enshrined in the act. When there is a strike, which the unions are entitled to engage in, and which they call, we have an opportunity to conduct conciliation, followed by mediation and, ultimately, arbitration. At present, that is in the law and that is what we are going to do. We are going to allow the parties to do it. We are going to force them to bargain so that they can reach an agreement.

If one of the parties wants to abuse its powers, thinking that it can force the other to come around to its view, then it risks hitting a bump in the road. Why? Because under our legislation, after three months, if the parties have not agreed, if they have not reached an agreement, they will have to submit their offer. The union will submit its offer based on what it wants, CN management will submit its own offer, and the arbitrator will decide. The arbitrator will select offer A or offer B, but not something between the two.

No one wants to find themselves in that situation. We believe that it is in the parties' interests to sit down, bargain and come to an agreement, while keeping our economy functioning. That is what our legislation does, it provides for our system to function properly.

[Joe Volpe, Liberal, Eglinton—Lawrence, ON]

Mr. Speaker, I would like to ask the Minister of Labour a question. We saw in his presentation and in his responses that he is thinking about the interests of workers in his plan. I would hope so.

I would like him to explain as briefly as possible whether his plan is compatible with all the existing regulations in the free market for resolving workplace conflicts between management and employees in a company. Can he tell us if the system he is suggesting we consider today, as parliamentarians, is compatible with all the other means available in the free market? Yes or no?

[Jean-Pierre Blackburn, Conservative, Jonquière—Alma, QC]

Mr. Speaker, during this dispute between the two parties, we made our conciliation services and then our mediation services available, providing the parties with the best people we could offer. They worked hard and an agreement was reached between the representatives of the union and of Canadian National. However, perhaps because of a dispute between unions—this is the right of the workers—the workers decided they were not satisfied with the agreement. They had a 3% annual increase, they had a $1,000 signing bonus and they had one year to discuss. They refused this.

Balance is important here. It is extremely important. One party cannot crush the other. Both parties must come to an agreement that is in the best interests of everyone, to keep the country running smoothly. With this in mind, we must now take—

[The Acting Speaker, Andrew Scheer]

I am sorry, but the clock has run out.

Resuming debate, the hon. member for Davenport.

[Mario Silva, Liberal, Davenport, ON]

Mr. Speaker, let me first begin my remarks today by pointing out that the bill we are debating here today is quite frankly the worst way in which labour disputes should be resolved. However, there are times when it is clear that the parties to a labour dispute hold positions that are so utterly irreconcilable there is virtually no reasonable prospect of a resolution being attained.

This reality alone is sufficient for consideration of government intervention. However, let us add to this the fact that today we are dealing with a strike that has the potential to significantly impact the lives of Canadians across the country, as well as our economy, and there is really little option but to intervene. It is indeed a last resort whose time has come.

From the very beginnings of our country, the dream of a national railway linking all parts of Canada was a recognition of the very unique challenges that face us geographically and economically. Our reliance upon our national railway system is undisputed. The realities expressed by Sir John A. Macdonald at the very birth of our nation are the same realities that we continue to understand today. The railway has been an integral part of this country's success, both as a nation and economically.

All of this brings us to the Canadian National Railway strike that began on February 10. Looking back to the beginning of this strike, we cannot help but wonder how anyone could be surprised at how this strike has come to the point where government intervention is unavoidable.

Under Canada's labour code, employers and their union representatives are required to designate which employees are essential prior to a strike being authorized. This process did in fact take place in the case of Canadian National and it is simply inconceivable that both parties would agree that there were no essential workers at CN.

Let me reiterate this statement: the two parties to this labour disruption, CN management and the United Transportation Union, both agreed that there were no essential employees who would need to continue working in the event of a strike.

As members can imagine, this agreement was challenged by the former Liberal labour minister. However, in view of the law, the Canada Labour Code, and the fact that this was mutually agreed upon by both parties, the agreement was confirmed by the Canada Industrial Relations Board: no essential employees.

Since there would be no essential employees in place in the event of a strike, it was simply inconceivable that Canadian National would be able to fulfill its essential duties to Canadians or its business customers. In effect, the die was cast long ago as to how this strike would end.

One can only wonder why the employers in this case would have agreed to such an understanding. If it was indeed simply a strategy to solicit government intervention, then it was wrong, short-sighted and irresponsible.

To this, we can add the obvious difficulties that are currently taking place within the union representing Canadian National employees. As soon as the strike commenced, we quickly witnessed a scenario where the union in Canada was at odds with its international leadership, the latter indicating that it had not authorized the strike to commence and therefore the strike was not sanctioned.

The confusion associated with such a revelation obviously added to the difficulties in resolving this labour dispute. I would also question why, in view of the realities of the situation between Canadian National and the union, the government would wait so long before becoming directly involved in efforts to resolve this issue.

In a country like Canada, vast in geography and sophisticated economically, few would reasonably argue that the rail system in this country was anything but essential, all of which leads us to why we are supporting the back to work legislation today. Let us look at how this strike is impacting Canadians and our economy.

The Canadian Wheat Board informs us that the CN strike threatens the shipment of 10 million tonnes of grain. In fact, delays have already caused grain suppliers $150,000 per day in fees charged by ships stuck in the ports of Vancouver and Prince Rupert, British Columbia. The president of the Wheat Board, Mr. Greg Arason, has called upon the government to invoke this back to work legislation.

When the strike began in February, it was not long before one of our major industries was affected. Last February, only days passed before the Ford Motor Company was forced to close its plant in St. Thomas, Ontario. Ford and the other major automobile manufacturers are reporting that the same pressures are facing them once again as this strike begins again.

The Mining Association of Canada has expressed the same concerns. Due to the nature of its business and where it takes place, the mining industry clearly has a significant dependency on rail transportation.

Fertilizer producers across this country have also expressed their concerns in view of the coming spring season when their products will be most in demand.

We also recall that in February the rail strike was blamed for increasing gasoline prices for Canadians due to the pressure the strike created in the marketplace. This will surely come to pass once again.

In my home city of Toronto, there is continued uncertainty with respect to GO Transit, which transports hundreds of thousands of commuters each day. Even though there was an agreement in place to keep the Canadian National employees in place during the strike, this uncertainty is clearly of significant concern to those who use this commuter railway service.

Communities across the country rely on rail service. This is particularly true of smaller and more remote communities that rely on rail service for all sorts of commodities, supplies and transportation needs.

These are but a few examples of the dependency Canadian individuals and Canadian industries have on rail transportation. It is indeed our economic lifeline.

As I have said, back to work legislation is really our last resort. However, it is not unprecedented. In fact, since 1950 the federal government in this country has invoked back to work legislation over 30 times. In six of those instances, back to work legislation has been used for the rail industry.

Over the years, governments have clearly recognized the importance to our country of the railway industry for both the personal and the economic interests of Canadians. The need for this legislative approach is reinforced by the statement of the stakeholders themselves.

Just yesterday, Canadian National issued a statement indicating that “CN has concluded that a national collective agreement with the UTU cannot be reached”. From the union we heard over the weekend that “the UTU has no choice but to turn up the heat in their selective and targeted strike action”.

It is obvious that both sides to this labour disruption are becoming more entrenched rather than working together in agreement. One side is saying there is no hope of an agreement and the other is talking about escalating its activities. Quite frankly, Canadians and the Canadian economy cannot continue to countenance these positions.

Having said all of this, I must confess to being disappointed in the government's handling of this issue. Long before the strike began on February 10, the minister and the government understood the essential nature of railway services in Canada.

As I have already stated today, there are questions to be asked of the government. Why would it have left this to the very last minute, so to speak, before the issue appeared on its radar screen? Why would the government have allowed the brinkmanship to escalate to this level before bringing these two parties together to find a resolution that might have avoided the situation in which we now find ourselves? These are important questions for which the government must be held to account.

However, our decision to support this back to work legislation is a reflection of our commitment to put Canadians first. We much rather would have preferred to see the issue between Canadian National and its employees resolved through the normal channels of collective bargaining, but clearly the time for this has passed.

The bill introduced by the government receives our support not because it is prudent action on the part of the government, but because it constitutes a last resort that cannot be avoided. While supporting the passage of this bill, we encourage the government to be more prudent in the future in advance of labour situations like this strike.

Today we will support this bill because it represents the best interests of Canadians and acts to ensure that there is not an overwhelming disruption of our economic interests. I am hopeful that this issue will be resolved in a fair and equitable manner following the process set out in the legislation. We will certainly continue to follow this issue closely.

[Robert Carrier, Bloc, Alfred-Pellan, QC]

Mr. Speaker, I listened carefully to my hon. colleague's speech, and that of the Minister of Labour, concerning the back to work legislation for CN employees. The official reason given for this bill has to do with avoiding further damage to the country's economy. In principle, that is a valid argument. Yet, I am a member of the Standing Committee on Transport, Infrastructure and Communities and we are in fact just now beginning a review of railway safety. We are learning that, for reasons of profitability, the number of workers on trains is often reduced to a strict minimum and all decisions are made based on how rail companies can reap the greatest profits. This all goes on with the okay of, or unmonitored by, the Department of Transport, which is responsible for ensuring safety. Once again, it is the monetary aspect, the money factor, that supersedes everything else.

I would like to ask my hon. colleague how he can logically support a bill that simply forces workers back to work despite the dangerous conditions that exist on railways, rather than having a bill or a government that is devoted to improving the safety of our rail system. This would prevent the senseless loss of lives, both on railways and in the communities through which our railways run, as we have recently learned in committee. I now give the floor to my hon. colleague for his response to my question.

[Mario Silva, Liberal, Davenport, ON]

Mr. Speaker, I want to thank my colleague for that question. I have a great deal of respect for CN employees and the excellent work they have done for our country and, of course, to develop our economy and our market.

But quite honestly, we are in a very difficult situation now, and we have no choice but to support this bill. Not only is our economy at risk, but the situation between the employer and the employees is untenable.

The situation at present is difficult and, as members of this House, we have a duty to shoulder our responsibilities and adopt this bill.

[Peter Julian, NDP, Burnaby—New Westminster, BC]

Mr. Speaker, I do not understand the Liberal stance on this. I simply do not understand.

The member should know that we are now facing a situation whereby, because of CN's horrible management, we are facing derailments, collisions, fires and explosions, escalating to a rate of three to four a day now, because of what happened under the Liberals and the Conservatives when they simply gutted safety conditions.

The employees at CN said, “Enough is enough”. They said, “We have to restore some safety standards”. What we are seeing here in the House now is three parties saying that this is fine, that they do not want to see more safety, that they do not want to see those safety concerns addressed. They are saying that they want CN's position, the management position, imposed and simply given a blank cheque.

I cannot understand why the Liberals are supporting the Conservatives on doing something that we know will lead to a state of permanent uncertainty in our railway network. There are three to four accidents every day, any one of which has the potential to shut down portions of our system. When the employees said no to this, that the situation had to be addressed, the Conservatives said no, they were not going to touch safety, no sir, they were going to give a blank cheque to Hunter Harrison and CN's American management.

Why are the Liberals and the Bloc supporting these measures that will lead to permanent insecurity in our railway system?

Out there, Canadians expect us to make intelligent decisions based on the facts. We have seen escalating derailments and escalating safety problems. The employees want to see that addressed, but the government is imposing a settlement and basically imposing CN's management decision on the employees, which will lead to problems right across the country.

Why are the Liberals supporting the Conservatives on what is bad public policy, bad for communities from coast to coast to coast and bad for the employees of CN who want to have safety issues finally addressed?

[Mario Silva, Liberal, Davenport, ON]

Mr. Speaker, being a New Democrat in this House means being in the easy chair. It means never having to take responsibility for anything, being critical of everything and not worrying about what will happen to the economy of the country or what decisions will take place.

If the hon. member is really concerned about giving a blank cheque, then maybe he could propose an amendment or perhaps his party could bring in a private member's bill banning all back to work legislation, which his party has so far not done. Perhaps the NDP could say that if there is no settlement within three to five months it will support back to work legislation. Instead, those members like to take the easy road.

They will not bring in any of those amendments or make any of those decisions. All the NDP members like to do is criticize what is happening in the House. They basically say that we should allow things to happen and that even if it takes a year or two there is nothing we can do. They do not want to be responsible in the House.

There are times when issues can be addressed but the reality is how long that will go on. We have a problem here. Even though I am fully supportive of my colleague's argument about safety and of the argument of putting the blame on CN, there is a lot of blame to go around here. To blame only one side is totally unfair.