Bill C-39 Committee on Oct. 27th, 2026

[Eric Harvey, President and Chief Executive Officer, Railway Association of Canada]

Mr. Chair and members of the committee, thank you for the opportunity to present the Railway Association of Canada's perspective on Bill C‑39.

Our industry supports the government's objectives of accelerating infrastructure projects, encouraging investment, and strengthening Canada's competitiveness. However, certain provisions of the bill risk undermining these objectives. We believe targeted amendments are necessary to ensure the stability of our supply chains.

You have heard and will continue to hear a consistent message from supply chain participants, including the message from 18 national associations, in a letter I shared with you yesterday: Canada needs greater certainty to build, invest and trade, including the ability to intervene proactively before a strike or lockout significantly disrupts our supply chains.

We strongly support measures that accelerate infrastructure development and encourage private investment, including streamlined federal approvals, expanded exemptions for railway construction and the productivity mega deduction, a long-standing RAC priority that will strengthen supply chains and Canada's competitiveness.

There are also positive changes to the Canada Labour Code. Earlier bargaining can help. Special mediation and public reporting can improve transparency and accountability. Geographic certification can help promote supply chain stability at B.C. ports.

However, Bill C-39 falls well short of solving Canada's labour stability challenges. As proposed, the section 107 authority can be exercised only after a strike or lockout begins. By then, significant economic damage will already have occurred, and Canada will continue to repeat the damaging pattern of routinely telling global customers and investors that our supply chains are not reliable.

Railways cannot simply turn operations on and off. With 100,000 railcars and 4,000 locomotives across 40,000 kilometres of tracks, railways must begin winding down operation days or even weeks before a potential work stoppage. Trains stop. Ships wait. Canadian businesses lose sales. Workers lose income. Customers make other arrangements. Our trading partners again question whether Canada can deliver, and traffic diverts to alternative U.S. ports and supply chains.

This is not simply a labour relations issue: It is a national economic and trade issue. The Senate transportation committee recognized this challenge in its “Keep Canada Moving” report, recommending alternative dispute resolution when rail or marine work stoppages threaten the national interest. Bill C-39 should act on this recommendation by allowing the government to intervene before a work stoppage in exceptional circumstances, when failed negotiations threaten significant harm to the national economy.

We're not asking government to routinely intervene in collective bargaining. We always want to reach a negotiated outcome with unions, and we work hard to achieve deals at the bargaining table. We are talking about exceptional circumstances in which the national interest is at stake because of failed negotiations, no reasonable prospect of an agreement, a pending work stoppage and evidence of significant harm to Canada's national economy, trading relationships, consumers and exporters.

We also recommend removing extended interswitching from Bill C-39. Previous pilots demonstrated that this measure diverted Canadian rail traffic, jobs and investment to a U.S. carrier. This policy undermines the government's trade diversification, investment and economic growth objectives.

We are also concerned about the proposed national trade corridors council. We have already seen the supply chain table and the national supply chain office, neither of which demonstrated that greater government involvement improves supply chain operations. What would another council accomplish that these initiatives could not?

We ask the committee to make three targeted amendments: Enable earlier intervention under section 107 in exceptional circumstances, remove extended interswitching and remove the national trade corridors council. These changes would help Canada build, invest and trade with greater certainty.

Thank you.

[The Chair, Liberal, James Maloney]

Thank you very much.

We'll start with Mr. Albas for six minutes.

[Dan Albas, Conservative, Okanagan Lake West—South Kelowna, BC]

Thank you, Mr. Chair.

I want to thank all of our witnesses for coming today to help us try to improve this piece of legislation.

Conservatives obviously believe—and we've been making the case for over a decade—that Canada needs to build and needs to build faster, but on the transportation side, I'm really concerned that your industry is getting the short end of the stick in this bill.

Essentially, part 1 of the bill gives a statutory 12-month term. Now, we could take issue with whether that will actually deliver, but in part 2, where transportation is, there is just a cabinet directive that basically says there will be a one-year process.

There's a single window. I would prefer to actually make the national supply chain window the entity, because it exists right now and it has some familiarity with supply chains, but it's toothless.

I'll give an example. The Deltaport expansion, berth four, is a current project. As of September 19, 2026, the federal dashboard showed zero of five potential permits completed. The potential permits span Transport Canada, Environment and Climate Change Canada, and Fisheries and Oceans Canada. Outside of Transport Canada's area are the disposal at sea permit, the Fisheries Act authorization and the Species at Risk Act permits involving DFO and ECCC.

The question I have for all of you is this: Do you believe that there should be statutory timelines of a year in part 2 of the bill for Transport Canada? Do you believe that the office—whatever it ends up being—needs to have the coordinating power, so that you have a single window that can get all of that permitting done within the same time, just like in section 1?

I'll start with Mr. Harvey.

[Eric Harvey]

For the purpose of transportation projects that are direct concerns of ours, the bill is essentially proposing amendments under the Department of Transport Act that would give the minister the authority to coordinate the processes required for transportation projects. To that extent, we see it as an example of trying to have a single desk to coordinate all those processes.

There's also the proposal that the minister may create the transportation project office, which I guess is along the same lines. It is aimed at accelerating the approvals of projects.

[Dan Albas, Conservative, Okanagan Lake West—South Kelowna, BC]

What I want to convey, though, is that coordination.... The Major Projects Office can coordinate between different departments and different agencies, but it does not have a formal approval authority, nor can it actually name and shame those departments that don't come through.

Therefore, what we're asking for is a single window, which the minister can name, that would have the authority, similar to what's in section 1 of the bill on the Canadian Nuclear Safety Commission, to do the consultation and coordinate any permitting that's outside their direct purview in a single coordinated permit.

[Eric Harvey]

I would say that the Canadian rail industry has been asking for a long time to accelerate the approval of projects—and not just rail projects, by the way, because we don't sell or make anything that we move. For us, accelerated approvals of all kinds of projects for products that we move is key, and that's not just for us; it's key for the Canadian economy as a whole.

To the extent that your proposal would in fact assist in accelerating those approvals without compromising on consultations and mitigation measures for the environment, we would certainly be prepared to look at it.

[Dan Albas, Conservative, Okanagan Lake West—South Kelowna, BC]

I'll go to the Canadian Trucking Alliance, because when we're talking about major infrastructure, it includes roadworks, culverts and a lot of DFO and ECCC permits, in addition to Transport Canada.

Do you want to have a single window that has some authority and can bring all these different groups together so that projects get built within that statutory 12-month timeline?

[Jonathan Blackham]

Well, I certainly think we'd be open to the concept. From our perspective, we're looking to see things built faster. We rely heavily on the provision of infrastructure. We've been calling for a number of years for it to be expanded. If that's an idea to help improve things, then we're certainly open to the concept.

[Dan Albas, Conservative, Okanagan Lake West—South Kelowna, BC]

One of the things that we've also been talking about in terms of amendments is that if an outside agency—in this case, ECCC or DFO—is deficient and does not meet the statutory deadline, then whichever entity is head of the process, whether it be the Canada Energy Regulator, the Canadian Nuclear Safety Commission or Transport Canada, should be able to name and shame with some public accountability and say that this particular group is out of order, so that there's some transparency and the relevant minister can then be alerted.

Would you be in favour of an amendment that would put the onus on those agencies that are not under the direct control of the minister or deputy minister of transport?

[Eric Harvey]

It is clear that in recent years—and this is why we welcome this project so much—there has been a long period of time before some approving authorities recognize that the file is complete and then give the authorization with all the conditions that typically industries are prepared to go with.

I guess the purpose here is to make sure that things are done efficiently and rapidly, again without compromising the quality of the review.

I think this goes along the line of the previous proposition or suggestion that you made—

[The Chair, Liberal, James Maloney]

I'm going to have to ask you to wrap up, Mr. Harvey.

[Eric Harvey]

Okay. Again, if it would accelerate the process, we're certainly prepared to look into that, yes.

[The Chair, Liberal, James Maloney]

Thank you.

Thanks, Mr. Albas.

Mr. Louis, please go ahead.

[Tim Louis, Liberal, Kitchener—Conestoga, ON]

Thank you, Chair.

I want to thank all the witnesses for being here as well.

I'll start with the Canadian Trucking Alliance, which you mentioned in your opening remarks represents about 5,000 trucking companies across Canada.

Your organization expressed the need for strengthening trade corridors, reducing bottlenecks, digitizing trade documentation and modernizing transportation approvals. All of those objectives align closely with this bill, which addresses strengthening supply chains, strategic trade corridors, transportation project coordination and reducing administrative burdens.

For trucking companies in my region—Erb Group, Challenger motor freight—this can help. It's going to help move goods instead of moving paper.

Can we talk about strategic trade corridors and how we can focus on removing those bottlenecks? How could the framework that's proposed here improve the movement of goods and strengthen that supply chain, especially at those intermodal points?

[Jonathan Blackham]

Thank you for that. Broadly speaking, taking this type of focus on improving trade is in itself a win for us.

Trucking companies travel all over this country. They see all the issues out there. They experience the bottlenecks on the highway, and they experience them at facilities with other modes. They experience it in their everyday travel in this country. To see this kind of focus on trade corridors....

I mentioned in my opening statement that we were interested to hear more about the potential for a council. We would love to hear more about this. I think there are some who see potential and some who have some questions, as we do, but if the overall objective here is focusing on transportation—and in our case, highway transportation—we're all for it.

[Tim Louis, Liberal, Kitchener—Conestoga, ON]

That brings me to the shift to digital trade.

The building Canada strong act promotes digital trade and has tell-us-once information sharing to reduce duplicate reporting requirements. We've heard that from shipping, and we've heard that from ports.

How would that apply in trucking? How would fewer paperwork requirements and the use of digital trade improve efficiency? How can that lower costs? How can that enhance competitiveness? What would that mean for your industry?

[Jonathan Blackham]

It's excellent.

There is a surprising amount of physical paperwork involved in moving loads, probably more than people would expect in 2026. If we're aiming to reduce that, it's an excellent move, particularly at the border. There are a lot of issues with digitization and IT infrastructure at the border, so if we're making progress on that front, it's excellent, in our view.

[Tim Louis, Liberal, Kitchener—Conestoga, ON]

So many of the trucking companies are doing the proper thing, doing the right job, but you talked about misclassification and you talked about wage theft. The government is taking action at the same time as our provincial counterparts. The CTA is representing Canada, but you're also working with provincial organizations to address this. What can additional resources do to prevent wage theft and misclassification and Driver Inc.?

[Jonathan Blackham]

It's excellent.

In fact, ESDC in particular has shown a lot of collaboration, both with other departments and with provincial partners. This is absolutely something we need. They have a multi-agency presence at truck enforcement stations along the highway network, and this has produced excellent results, but it's here and it's there. It's not a sustained presence.

Within our industry, inspections still show a 40% to 45% non-compliance rate, which is massive. While we've made significant progress, particularly under Minister Hajdu, we still have a long way to go.

[Tim Louis, Liberal, Kitchener—Conestoga, ON]

What you're saying is enhanced resources, and then enforcement.

[Jonathan Blackham]

That would be for the misclassification team at ESDC.

[Tim Louis, Liberal, Kitchener—Conestoga, ON]

Thank you.

Turning now to the FETCO, thank you very much. Your perspective is important, because we're hearing from different sides on this big legislation. We're hearing different things from employers and we're hearing different things from labour. The commonality is on having negotiations start earlier when there is a potential to have strikes. That seems to be the common ground.

Ninety-five per cent of collective bargaining works out before it gets to that point, but the 5% needs to be addressed. It sounds like both sides are agreeing that starting those negotiations earlier, having longer conciliatory periods and having that mediator would work.

What advice do you have on starting earlier and having transparency to avoid the strike in the first place?

[Derrick Hynes]

Thanks for the question. It's a good one.

You properly point out that in most situations, collective bargaining is working in the federal space. The number could be that 95% or 97% of the time, the parties are coming together. There's a history of bargaining, and they are getting deals.

The legislation is aiming to get to those unique situations, those rare circumstances, when it's just not working and the impacts are significant. The legislation lays out a process that we think is really going to help in some situations.

The early bargaining would help to bring the parties together to talk about some of their issues and try to sort out some of their differences earlier in the process. The conciliation period would be extended from 60 days to 90 days for the experts from the federal mediation and conciliation service to help the parties try to come to a deal. The minister would have the authority to appoint a special mediator by day 75 of that new 90-day process, bringing an outside third party to the process to try to bring those parties to a deal. The objective throughout all of these steps is to try to incentivize better bargaining between these parties.

I think those on all sides of this discussion will agree that all of those steps are in the right direction. Where I think we tend to differ is on what happens next.

Let's say that the special mediator has come in and provided his or her expertise, but the parties are still hopelessly stuck in bargaining and there does not seem to be any meaningful bargaining happening. I think it's at that point that this process turns in a way that should be even more helpful, which is that the special mediator will issue a report to the minister, outlining what's happening at this table and recommending a series of steps forward.

Again, the parties still have an opportunity in the midst of all that to get a deal if they see government intervention as a potential outcome. Then we get to the process of some intervention by the minister, if it is necessary because a work stoppage in this space runs contrary to the national public interest. Again, it's important to point out that this would be in rare circumstances.

[The Chair, Liberal, James Maloney]

Thank you.

We will go to Mr. Ste-Marie.

[Gabriel Ste-Marie, Bloc, Joliette—Manawan, QC]

Thank you, Mr. Chair.

Greetings to all the witnesses, and thank you for joining us.

Mr. Blackham, at the beginning of your presentation, you talked about the problem related to the “Driver Inc.” phenomenon or low-cost drivers. Can you remind us what that is, what it represents in terms of risks to public safety and to your industry that pays real drivers? What has the government done so far and what remains to be done?