February 4, 2011 / 8:21 PM / in 7 years

Canadian Pacific Railway girds for possible strike

OTTAWA (Reuters) - Canadian Pacific Railway said it began repositioning managers across its network on Friday as part of a contingency plan to continue service as a February 8 strike deadline looms.

Canada’s No. 2 railway said that in recent days it has exchanged offers with the Canadian Auto Workers union, which represents 2,100 mechanical services workers.

“There is some polarization, certainly, on the wage and benefit package and we’re trying to work our way through that,” said Bob Chernecki, assistant to CAW President Ken Lewenza.

“We obviously have an offer from them which fell way short of our expectations. So we’ve responded, as of this morning, and we’re waiting to hear back.”

CP said its offers, which include wage and benefit increases, are consistent with settlements ratified by four other railway unions to date.

The contracts expired December 31.

A strike could be called at one minute after midnight on February 8, following a mandatory 72-hour strike notice, which would be issued by midnight tonight.

Asked if he was optimistic, Chernecki said “I‘m guarded”, adding that talks have been “challenging”.

CP previously said it had trained 1,200 managers and put a plan in place to fully operate the railway if a labor dispute occurred.

“The company does not seek a dispute but we are very prepared if one is brought upon us,” CP said in a statement it issued to customers on Friday. “We remain hopeful of a negotiated settlement.”

The company has rail lines across Canada and in the upper Midwest and northeastern United States.

The CAW and Canadian National Railway Co, Canada’s biggest railroad, reached a tentative contract agreement on January 24, averting a strike.

Shares of CP were down 15 Canadian cents at C$66.05 on the Toronto Stock Exchange and 1 cent higher at $66.82 on the New York Stock Exchange on Friday afternoon.

Reporting by Susan Taylor; editing by Rob Wilson

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