Canadian Pacific, union reach deal on commuter trains

Officials with Canadian Pacific Railway and the union representing nearly 5,000 of its workers say commuter trains in Montreal, Vancouver and Toronto will keep running in the event of a strike.

Members of the Teamsters Canada Rail Conference can legally walk off the job one minute after midnight Wednesday local time if a deal isn't reached. But now rail passengers on AMT, West Coast Express and GO Transit networks won't be affected if the deadline passes without a deal.

The two sides met with federal Labour Minister Lisa Raitt on Tuesday morning and continued their negotiations throughout the day. "At the request of the minister of labour, and as a demonstration of goodwill, CP has agreed to allow operation of the three metro commuter services in Canada," said CP spokesman Ed Greenberg.

"The union continues to threaten to withdraw its members' services for the remainder of the CP Canadian freight network."

Two inter-city Via Rail routes in Ontario that use CP infrastructure will still be affected if there's a strike: between Sudbury and White River and the Brockville-to-Ottawa segment of the Toronto-Ottawa route.

That list would have been longer had the two sides not reached a deal, said Via spokesman Malcolm Andrews.

"We would have had some runs to Kitchener, London, Sarnia that would have been affected, but because of what they were able to do, those lines now are not affected."

"VIA is considering all possible options for trains that are affected," it said in a release, "and where possible will either detour or replace by bus for a portion of the trip.

It promised to post details will be posted on itswebsite"as the situation evolves."

In an interview with CBC's As It Happens, Raitt wouldn't say whether the government would bring in back-to-work legislation. Earlier this year, Raitt stepped in to halt a strike at Air Canada.

"Our government has made no secret over the fact that we were elected with a strong mandate to ensure Canada's economy continues to grow and prosper...and that's what we're there to do," she said.

"In this case, if there's a work stoppage, we're going to continue to monitor and see what the effects are."

Asked if there was legislation in the works, Raitt said,"Ihave nothing but my good intentions at the table to help these guys do the deal. Talking about legislation really isn't going to help the matter."

Douglas Finnson, vice-president of the Teamsters Canada Rail Conference, described the meeting with Raitt as "very positive," but said he couldn't comment on the specific topics that were discussed.

The major points of contention are pensions, some work rules and fatigue management, Finnson said.

Greenberg said the company is willing to proceed into binding arbitration or extend the negotiation period if a deal isn't reached by the deadline.

'I think I've heard enough from both sides that they realize what's at stake' Prof. George Smith

"Meetings are continuing, so that's a positive sign for our company," he said.

A strike would halt shipments of grain, fertilizer, coal and other goods Canadian Pacific moves along nearly 24,000 kilometres of track in Canada and the U.S.

Greenberg added a work stoppage could have ripple effects on other railways that connect to the CP network.

No contract since October

The strike threat comes at a time of major changes at Canada's second-biggest railway.

A bruising months-long proxy fight with the railway's biggest shareholder culminated last week in Fred Green's exit as CEO. New York hedge fund Pershing Square Capital Management argued the railway was lagging its peers under Green's leadership and that a change in CEO was necessary.

Green and five other board members stepped down hours before the company's annual general meeting last Thursday after it became evident shareholders had voted overwhelmingly for director nominees on Pershing's slate.

The Teamsters' Finnson said the union has not yet met with Green's interim replacement, Stephen Tobias. He said the management shakeup has not affected the bargaining process one way or the other.

Pershing Square CEO Bill Ackman told shareholders at the annual meeting that change would not happen overnight, but that Canadian Pacific could become one of the best railways in the world.

CP's new leadership will have a tough time balancing shareholders' high expectations against the labour challenges the railway is up against, said Smith.

"In a certain sense, the new management is boxed in by their declaration of an economic revival for CP," he said.

"The shareholders don't see that. They see new people who promised great things and here's the first test of it. Only it came a little sooner than anyone expected."