Exploring the impact of work stoppages in Canada

With many businesses across Canada teetering into a strike-action, industries are on high alert. But could even more sectors join in strike actions in the near future?

According to Statistics Canada, there has been a threefold increase in work stoppages across the country from 2022 to 2024. The increase follows a downward trend in strike-related activity between 2015 up until the COVID-19 pandemic.

“I think we’re just going to see this continuing,” prdeicts labour and employment lawyer Kara Bashutski. “This trend is not slowing down. We’re going to see this continuing, and it is important to note that it is across all industries.

“So the data is showing, so far to date in 2024, that we’re gonna meet or exceed what happened last year.”

CityNews explainer: how do strike actions work exactly?

Bashutski says it’s because of two main reasons: the economy and how it’s changed affordability for Canadians.

“We’ve been living with high inflation for many years now,” Bashutski told CityNews. “That’s contributed to increased costs of living and an affordability crisis. That is good breeding grounds for difficulties with employers and employees, so that sets the stage for the willingness to go into collective action or workers on strikes.

“It’s the economic conditions that are coupled with this opportunity that’s happening because a lot of collective agreements have expired. So for example, the Air Canada pilots, their collective agreement was in place for 10 years. It’s expired so this is the first time in 10 years and conditions have changed massively since 2014.”

“For the past few years, these collective agreements have been expiring, which allows the union to kind of step in and start negotiating better wages that are keeping up with … this increased cost of living. Unions finally have the time, collective agreements have expired, they can step in and say now we’re gonna negotiate better wages.”

Unfortunately for the average Canadian, it means impacts in every household.

“We’re gonna continue to see increased cost of living for a while because of this,” Bashutski said. “Labour will drive up places elsewhere. But I think we might also see a continuing dominos effect. If you see one labour union striking, then you may say, well I can do this, too. And that may go for both the private and public sector.

“When there’s one successful contract negotiation, it’s set as a baseline so a lot of unions will then look to that successful contract negotiation and try to meet or achieve that in their negotiations.”

Concerning work stoppage at Canada’s two major railways

One area of concern for businesses is Canada’s railway labour worker dispute.

“The rail line for our industry as a whole is hugely impactful. It is an essential service that we need in our business to keep going,” said Mark Kennedy, vice-president of STAR Building Materials.

“Without the rail cars sending those raw materials to the plants, our industry shuts down and now we can’t do anything.

“If this strike happens and it actually extends any period of time, we’re going to run out of material.”

Even though rail workers have been called back to work through binding arbitration, Kennedy is still making moves to prepare in case a strike action does happen.

“We are working closely with our suppliers to make sure that there’s enough product on the ground,” he said. “We’re potentially ordering more to ensure that we’ve got stock levels that can support our customers. We’re looking at alternate truck routes and sending in trucks to where we normally would order rail car situations to make sure that we’ve got enough product flowing.

“Our buyers are on it non-stop in the last couple of weeks to ensure that we’re going, but we are taking in more material to ensure that we’ve got enough supply for our customers moving forward. You have to.”

He feels Canada needs to better protect itself and its supply chain against work stoppages, especially since a rail strike would affect the entire country and drive up prices.

“The reality is, corporations and businesses need to treat their employees fairly,” Kennedy said. “I think a good, fair arbitration situation would be able to be implemented, would create a fair situation to resolve these conflicts and to make sure everybody is treated right.

“You definitely need to have some kind of a support system for the employee as they come through. Corporations are doing their best as well to try to manage those situations. But some of these industries, we as Canadians, need to have that in order to keep stability in our economy.”

Kennedy feels rail transportation should even be considered an essential service.

“There is so much that gets moved in the rail system for our industry and others that, I can’t believe that it’s not, to be honest with you,” he said.

“It needs to be figured out to be sustainable and to make sure that we’ve got enough product flowing on a consistent basis and the interruptions are minimal. Because otherwise, we saw the effect of how it happens and how prices go skyrocketing when it doesn’t.

“Canada as a whole needs to have a stable supply chain. It just has to happen.”