Striking CN rail members are seen outside the Mclean Rail Yard in North Vancouver., Wednesday, November, 20, 2019. (Jonathan Hayward/The Canadian Press via AP)

Despite calls from some provinces to enact back-to-work legislation, the federal government said Friday it believes the fastest way to resolve the strike at Canadian National Railway is through collective bargaining.

“We believe that mediation collective bargaining is the right way to do this. We’ve looked at the situation and we feel that the two sides need to be talking to each other,” Transport Minister Marc Garneau told reporter gathered in Montreal.

"We believe that this is not only the most probable, but also the fastest way to resolve this issue so that we can find a solution and get CN back operating as it has before, delivering products across the country."

Garneau’s comments came as negotiations continued between CN and the Teamsters Canada Rail Conference, the union representing 3,200 workers that walked off the job shortly after midnight on Tuesday.

On Friday, the union blamed CN for a pending propane shortage in Quebec, saying the decision to not transport the resource was “a business decision.” Quebec Premier Francois Legault said Thursday that the province could run out of propane in a matter of days, describing it as an “emergency” situation that could wreak havoc at hospitals, nursing homes and farms.

“While CN is nowhere near operating at full capacity, we think enough trains are running to allow CN to supply Ontario and Quebec with propane,” Teamsters president Lyndon Isaak said in a statement released on Friday.

“We wonder if CN is choosing not to ship goods like propane in order to manufacture a crisis and force back-to-work legislation.”

CN did not respond to requests for comment regarding whether its trains were still operating and at what capacity. Garneau told reporters Friday that CN is limited to “about 10 per cent of... the amount of trains that they can operate given this strike, because they simply do not have as many white-collar conductors that are capable of running the trains.”

In a statement released Thursday, CN chief executive JJ Ruest urged the union to agree to binding arbitration.

“All of us at CN are very aware of and regret the impact that the strike is having on our customers, supply chain partners, the Canadian economy, trade in general, and the public,” Ruest said.

The CN conductors, trainpersons and yard workers have been on strike since just after midnight Tuesday after the union and company failed to reach a negotiated settlement. Teamsters said that wages are not a sticking point in the negotiations, but that the union is looking for changes to operating practices that it says are dangerous, and that it is refusing to accept a lifetime cap on prescription drug coverage. The union said no progress has been made on the health and safety issues.

Many industries that rely on Canada’s largest railway to bring product to global markets have raised concerns that current and future investment may turn elsewhere if the strike continues.

CIBC economist Avery Shenfeld said in a note to clients on Friday that a prolonged strike at CN “would clearly be disruptive to the Canadian economy.”

“At this point, we were already expecting real Q4 growth of only 1.0 per cent, so an extended strike risks seeing a near flattening in economic activity to finish the year, and hit an already-challenged goods sector,” he wrote.

With files from the Canadian Press

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