The union for Canadian Pacific Railway’s train crews and rail traffic controllers isn’t yet in a strike position, but the railway already wants Ottawa to drop a conciliator into their contract talks.
Calgary-based CP said Friday it has been in talks with the Teamsters Canada Rail Conference (TCRC) since early October toward a new contract for about 4,800 workers, whose previous contract expired Dec. 31.
The railway said Friday it has asked federal Labour Minister Lisa Raitt to appoint a conciliator to "assist in progressing discussions on a new labour agreement."
CP CEO Fred Green — who in recent weeks has come under pressure from activist shareholders to tighten the company’s operating ratio, or step down in favour of ex-Canadian National Railway (CN) CEO Hunter Harrison — said the company believes the best chance at a settlement will come with "expert, third-party support" and a "focused time table."
The conciliation process, on average, can take 80 to 90 days, the company said.
At issue, Green said, are the company’s "legacy pension costs," which "significantly impact CP’s operating ratio and our ability to further fund investments that will support growth opportunities for our customers."
CP said Friday it wants to achieve "changes to legacy pension and post-retirement benefits to make them industry-comparable," noting it has put $1.9 billion of solvency deficit contributions into its pension plan over the past three years.
"We have a number of proposed options for pension plan modifications, some of which align with the industry, all of which are fair to employees, and none of which have any impact on existing pensioners," Green said in a release.
Some of the options, CP said, would provide "guaranteed pension payment that is a multiple of average Canadian industrial pension payment and is comparable to what this union has already agreed to for the majority of its members at another major Canadian railway."
CP didn’t name the railway, but according to a Jan. 31 memo to workers from the chairmen of TCRC’s bargaining committees, a meeting the previous week on pension solvency funding ended with "yet another demand" to allow CP to get its pension and post-retirement benefit costs "at or below current CN levels."
The TCRC committees said CP has proposed either of a "defined contribution pension plan for all future service and CN’s post-retirement health care spending account program," or a "CN-style defined benefit pension plan with CN’s $60,025 maximum pension" and the health spending account program.
"While option 1 is our preferred option, we are prepared to discuss option 2," the Teamsters quoted CP representatives as saying.
"It appears that CP wants to manage any pension shortfalls on the back of the current and future unionized work force without shouldering any liability to management," the Teamsters said. "If there is anyone who thought that CP appreciated all of your extra efforts during the past floods, natural disasters and manpower shortages, think again."
The Teamsters also said CP management’s defined-benefit pensions "will continue (and) contain more options than the unionized employees ever had."
"We’ve made changes to the management pension plan," Green said in Friday’s release. "The time to address this within our collective agreements is now."
Currently none of CP’s unions, "including this one, are in a legal strike position," the company said.