UPDATE 1-CP Rail trains running after government ends strike

Fri Jun 1, 2012 11:26am EDT

* Trains begin rolling Friday morning

* CP calling back 2,000 laid off workers

By Susan Taylor

TORONTO, June 1 (Reuters) - Canadian Pacific Railway Ltd trains resumed rolling Friday morning after legislation ended a nine-day strike at the country's second-biggest railroad, as the company worked to clear the backlog on its tracks and in customer facilities.

Some 4,800 locomotive engineers, conductors and traffic controllers walked off the job May 23, stalling Canadian freight traffic and costing the economy an estimated C$80 million ($77 million) a day, according to the government.

Calgary-based CP said its Canadian freight operations restarted at about 0700 ET on Friday.

The company, which two weeks ago concluded a bitter proxy fight and is now searching for a new chief executive, said it ships commodities worth C$135 million every day. That means 10,000 shipments daily for 3,000 customers over its 14,800 miles (24,000 kilometers) of North American track.

Companies have scrambled to find alternatives to ship their grain, coal, fertilizer, autos and other goods over the past week as CP trains sat idle.

"As part of the start-up plan, our customer service teams will be reaching out to our customers to work with them," said CP spokesman Ed Greenberg.

The company is also recalling the 2,000-plus workers it laid off during the stoppage.

Its engineering and signal staff ran checks earlier this week to ensure tracks were ready for traffic, and CP expects operations to return to normal within 48 hours.

A government back-to-work bill passed late on Thursday allows Ottawa to appoint an arbitrator who has 90 days to work with the company and the union to forge a compromise contract, which will then be imposed.

Talks broke down on CP's plan to cut pension funding by 40 percent, the Teamsters Canada Rail Conference union said.

CP shares were down 2.6 percent, or C$1.99, at C$74.09 on the Toronto Stock Exchange, amid broad market declines.

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