CP to lay off 500 MOW workers

Canadian Pacific yesterday began laying off 500 track maintenance workers, the Teamsters Canada Rail Conference announced on its website.

The "temporary layoffs are the result of lower car volumes and a softening demand in a lackluster North American economy," said CP Assistant Vice President of Public Affairs and Communications Martin Cej in a prepared statement to CBC News, which the union also posted on its website.

The layoffs follow CP's announcement last month that it expects second-quarter revenue to decline about 12 percent compared with the same period in 2015. The Class I is anticipating lower volumes in bulk commodities, such as grain and potash. In addition, CP executives cited the Alberta wildfires and a strengthening Canadian dollar as reasons for the lower revenue.

However, the union has raised concerns that by laying off track maintenance workers, CP raised the risk of future derailments. Union officials denounced CP for neglecting to perform a formal risk assessment of how the job cuts would impact rail lines across Canada.

In his statement to CBC, Cej said that CP has invested heavily in track infrastructure over the past decade and that the layoffs were temporary until market conditions improve.

The layoffs will not affect CP's commitment to safety, as the railroad will continue to perform visual inspections and ultrasonic rail flaw detection of track, Cej said.

"CP carefully considered the changes that were being made and concluded that since they posed no additional risk to employees, the public, property or the environment, a risk assessment was not required," said Cej. "Transport Canada was notified and agreed with this conclusion."