CALGARY — Canadian Pacific Railway says it will avoid large-scale job cuts, like those announced November 26 by rival Canadian National, due to gradual staff reductions over the past two years and a more diversified business strategy, the Canadian Press reports.
Calgary-based CP Rail, the smallest of six remaining major railways in North America, said that two years ago, it anticipated drought-related declines in crop shipments and started reducing staff.
Since the belt-tightening began, CP Rail has cut about 1,600 positions to about 16,000 employees, and boosted its productivity to the envy of the industry.
“We’ve already made the significant reductions to account for the poor grain crop,” spokesman Len Cocolicchio said Wednesday.
“We don’t have any plans right now for another round of major cuts, but as always we will adjust our workforce to account for any fluctuations in work load.”
Montreal-based CN will slash 1,146 jobs — two-thirds of them in Canada — in a move to reduce costs and stay efficient in the wake of this year’s disastrous harvest. Before the cuts, Canada’s largest railway had just under 24,000 employees.
CN also announced it would have to take a $173-million provision in the next financial quarter for liabilities arising from personal injury claims from workers in the United States, where the law allows them to sue their employer.
This includes claims for hearing loss, carpal tunnel syndrome and asbestos-related disease.
CP Rail said because it has “much more modest operations in the U.S.” than any other North American railroad, they are less affected by the personal injury claims issue.
Cocolicchio also said CP Rail has been busy growing its business in other sectors — such as its intermodal business — to compensate for the drought-affected harvest.
In its third quarter earnings released last month, CP Rail announced revenue from grain shipments were down $19 million or 10 per cent.
But revenues in other commodities helped make up for some of the slack, with sulphur and fertilizers gaining 18 per cent.
“When you look at the hit we took from grain, the fact that we were able to offset that hit on the revenue line with growth in other sectors of the business speaks volumes about the degree to which we managed our way through what could have been a devastating problem for us,” said Cocolicchio.