FOCUS: Canada govt will need to end rail strike

13 April 2007 17:05  [Source: ICIS news]

By Stefan Baumgarten


TORONTO (ICIS news)--Canada’s government will likely need to intervene to end the Canadian National (CN) rail strike as negotiations to settle the dispute are unlikely to succeed, analysts said on Friday.


Either way, it could take some time before the striking rail staff return to work, they said.


Analysts at Toronto-based RBC Capital Markets pointed to turmoil within the United Transportation Union (UTU) that was complicating negotiations with CN.


The union had hoped to ratify an agreement reached with CN that ended a 15-day strike in February. However, almost 80% of the workers rejected the deal and strike action resumed on Wednesday.


“We are uncertain as to how this dispute will resolve itself,” RBC said. It would likely need back-to-work legislation to end the strike as the UTU would be unable to reach a new accord acceptable to both workers and CN.


Canada’s Parliament is expected to debate the government's back-to-work bill next week. How quickly it could become law, if at all, was uncertain, political analysts said.


Prime Minister Stephen Harper’s Conservatives are forming only a minority government and have to work with three opposition parties.


Voting patterns in Parliament have become increasingly unpredictable since Harper took office early last year and party discipline is often fragile.


Also, the strike had been declared legal by Canada’s Industrial Relations Board in February. This may constrain many parliamentarians in supporting back-to-work legislation, unless the strike’s economic harm damage worsens, analysts said.


Even if Harper wins quick backing for the bill, it may take some time to works its way through the legislative process and become law, they said.


Unanimous support would speed the process up, but it was not likely that the vote would be unanimous, they added.


February’s strike action quickly hit Canada’s shipments of chemical and fertilizer commodities and threatened to paralyse the port of Vancouver.


Canadian chemical firms called on the government to intervene quickly. That call was supported on Thursday by an association of sulphur producers, which warned that continued strike action would quickly damage its industry and the wider economy.

By: Stefan Baumgarten
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