Thank you, Mr. Chairman. My name is Sean Finn. I'm the senior vice-president and chief legal officer at CN.
Mr. Chair, it is a pleasure for us to be here today and to have the opportunity to give you our comments on Bill C-257.
We at CN take Bill C-257 very seriously and view it with great concern. CN has approximately 15,000 unionized employees across Canada. These employees belong to seven unions in 21 certified bargaining units and are covered by 30 collective agreements.
There are a number reasons why certain sectors are federally regulated. One is that we are companies with broad enough operations and important economic impacts that we significantly impact the Canadian economy.
CN, as you know, is a freight railway. We serve eight provinces as well as the mid-United States. In Canada, CN serves the ports of Vancouver, Prince Rupert, Montreal, and Halifax. In the case of Halifax and Prince Rupert, we are the only railway servicing those ports. The majority of VIA Rail Canada's trains travel on CN tracks, as well as much of the commuter traffic of GO Transit in Toronto and the Agence métropolitaine de transport in Montreal.
Since 1971 CN and its unions have been involved in four strikes. Strikes in 1974, 1986, and 1995 all required back-to-work legislation by the federal government. This was done because Parliament deemed it necessary to ensure that the Canadian economy did not suffer serious damage, and also to ensure that CN's customers did not have to shut down plants and lay off workers, with substantial impact to their businesses.
In 2004 CN faced a month-long strike by the CAW. CN continued to operate during the work stoppage, exercising our rights under the existing labour legislation, using managers—who had to be qualified and skilled—as well as retirees to continue to operate the railway and service our customers. The strike was generally peaceful, and ultimately a settlement was reached through the collective bargaining process and ratified by a large majority without government intervention. I'm very pleased to note that just last week the same CAW employees, without a work stoppage, ratified a new four-year agreement.
If this legislation were passed, with its strict limit on the tasks management personnel can perform and taking away our ability to bring back retired managers to help run the railway, it would not be possible for us to maintain operations through a strike.
Under current labour legislation, bargaining representation is system-wide. With the changes suggested in this bill, labour would have the power to disrupt company operations nationwide. Companies would not have the resources to deploy to maintain the critical services necessary to maintain nationwide services essential to the general welfare of Canadian citizens. We fear this would mean a return to a system where any nationwide railway work stoppage would inevitably require government intervention. This is not the way to build trust between management and the union or to improve labour relations.
I'd like to speak a few minutes about the collateral damage that would take place in the event of even a short railway strike.
First, the commuter rail service in Toronto and Montreal would quickly grind to a halt, leading to traffic jams and great inconvenience for millions of people. In some cases, depending on which union is striking, VIA Rail service could largely stop.
I must remind you that while it is possible to apply to have workers designated as essential, the grounds are very narrow, and the chance of success, unless the unions agree, is minimal. Economic consequences are not considered.
Canadian railways are a significant driver of the economy. The Canadian economy is heavily dependent on trade. The majority of our bulk products and many of our manufactured goods are moved to export position by rail, as referred to by Canpotex. Grain, forest products, coal, sulphur, fertilizer, metals and minerals, and many other bulk commodities rely almost exclusively on rail to get to destinations in the United States or to export position at Canadian ports. The many companies relying on just-in-time delivery parts would see their production lines slow and eventually stop. Companies would incur increased storage costs and in some cases would have serious problems finding places to store their production. Canadian ports would face serious backlogs on incoming containers, and ships waiting for out-going products would sit in port running up large demurrage bills. Canadian farmers and other primary producers would suffer, as would Canada's international reputation.
These would not be short-term or one-time issues, as the reliability of Canadian suppliers to meet their commitments would be drawn into question. In the past, strikes at west coast ports have caused traffic to move to U.S. ports, and some of that traffic never comes back.