(Reuters distributed the following article by Charles Grandmont on March 15.)
MONTREAL — The strike at Canadian National Railway Co. could be over by the end of the week, the Canadian Auto Workers (news – web sites) union said on Monday, as 5,000 workers prepared to vote on the latest contract offer from Canada’s largest railway.
“We will begin (the vote) tomorrow and we will try to have a final result for the whole country by Friday,” CAW negotiator Abe Rosner said.
If union members vote to accept the offer, the strike, now in its fourth week, would be lifted immediately.
“It’s a bit ambitious, but we have to do it because the strike will continue as long as there is not a positive vote,” Rosner said.
Meantime, logistical headaches for Canadian shippers will remain because the 5,000 mechanics, sales clerk and container yards workers will stay off the job until the results of the vote are known. CN carries more than half of all rail shipments in Canada.
“Everybody will be holding their breath until the ratification vote,” said Bob Ballantyne, the president of the Canadian Industrial Transportation Association. “I think, in this instance, the possibility of ratification is quite high.”
The CAW said the tentative three-year deal includes annual wage increases of 3 percent and scraps CN’s new and much maligned disciplinary system, a sticking point that helped scupper an earlier contract offer.
Nearly a quarter of CN’s work force went on strike on Feb. 20 after rejecting the initial offer.
The latest offer also contains a C$1000 ($750) back-to-work bonus and improved shift pay and pension formula.
“We will await the results of the ratification vote, we hope that it is successful and we hope to have people back as soon as possible,” CN spokesman Jim Feeny said.
CN stock, which has lost 6.5 percent since the strike began, gained 31 Canadian cents, or 0.6 percent, to C$51.40 on the Toronto Stock Exchange on Monday amid a broad-based selloff. In New York, the stock closed up 46 cents at $38.76.
FIRST DEAL REJECTED
Union members caught their leadership off guard in February when they rejected a tentative agreement recommended by CAW negotiators.
The first agreement offered the same 3 percent wage increases, but did not address discontent over CN’s disciplinary practices.
In the first full week of the strike, CN’s overall traffic plunged 14 percent, as many shippers were forced to turn to more expensive truck deliveries to avoid bottlenecks at rail yards where containers are loaded between truck and train.
CN managers and contractors stepped in to help with the workload and, by the second full-week of the strike, overall traffic was down only 5 percent.
CN’s network, which is Canada’s biggest, also reaches the Gulf of Mexico through the U.S. Midwest. Its U.S. workers were not on strike.
CN, North America’s No. 5 railway, is the continent’s biggest hauler of forest products and also a major carrier of chemicals, grain and automobiles.
The nearly four-week long strike, the longest CN has faced in more than 15 years, contradicted initial industry expectations of a short disruption.
But transport analysts also said last week the strike seemed to have had a milder impact than expected on the company’s operations and profitability.
“CN held to its belief that it would not hurt its operating leverage through drastic wage increases,” said Merrill Lynch analyst Ken Hoexter in a research note on Monday.
“We could see a bit of a rebound in the share price over the next few days,” said the analyst, who reiterated a “buy” recommendation on the stock.