UPDATE 1-Canada's CN Rail reaches tentative deal with Teamsters union

Thu Oct 31, 2013 8:43am EDT

TORONTO Oct 31 (Reuters) - Canadian National Railway Co , the country's largest rail operator, agreed to a new labor contract for some 3,300 conductors, trainmen, yardmen and traffic coordinators represented by the Teamsters union, the railway said Thursday.

The tentative three-year deal, the details of which were withheld pending ratification, comes after a week of talks with government-appointed mediators. It averts the possible disruption of a cross-country network that ships goods ranging from lumber to crude oil.

Talks had earlier stalled over issues such as working longer hours and having less rest time between trips, the Teamsters Canada Rail Conference union had said.

Montreal-based CN, which reported market-beating quarterly profit last Tuesday, has said that none of its proposals would compromise worker health or safety.

The Teamsters' previous contract expired on July 22.

Labor peace at the railways comes at a particularly good time for Canadian farmers, who have a record crop that must move to market. The Grain Growers of Canada had asked the government to take "swift and decisive" action in the event of a strike.

Canada's government has been quick to intervene in recent years, sending unionized staff at railways and airlines back to work several times.

Last May, it used legislation to end a Teamsters strike at Canadian Pacific Railway Ltd, Canada's No. 2 railway, forcing 4,800 engineers, conductors and traffic controllers back to their jobs.

That strike, over pension funding, would have cost the Canadian economy an estimated C$540 million in economic activity each week, the labor minister said at the time.

CN's labor issues come amid a renewed focus on rail safety in Canada.

The company's mainline was closed for several days after 13 cars on a mixed-freight train derailed on Oct. 19, causing one car with propane to explode and three others to catch fire. There were no injuries in the incident, which the Transportation Safety Board linked to emergency brakes.

Safety issues are particularly sensitive after a July crude oil train derailment and explosion in Lac-Megantic, Quebec killed 47 people.

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