A week after the Canadian Pacific Railway (CP) said that it was expecting revenues to drop by 12%, it has announced that it will lay off 500 positions, a move unions say could make rail travel less safe.
“Last year we just went through 108 reductions, so we didn’t think they could cut any further into the bone then they’ve already have, but apparently they believe they can,” said Gary Doherty, president of the Teamsters Canada Rail Conference’s maintenance of way employees division, the union representing CP rail employees.
In a statement, CP said the layoffs are temporary and are a result of lower car volumes and softening demand – factors the company says are affecting all railroads. CP’s statement also referenced a June 21 announcement that said the railroad was experiencing a decline in second-quarter revenue as a result of lower than anticipated bulk commodities.
“CP must adjust staffing levels according to business ebbs and flows associated with global markets and operational efficiency gains,” said company spokesman Jeremy Berry.
The layoffs affect maintenance employees responsible for track upkeep. Of the 500 positions laid off, only 260 were occupied. According to Doherty, that is roughly 10% of its summer membership, which is usually around 2,100 people. Many of the typical four-person maintenance teams have been cut down to three people. Other positions that perform more specialized work have also been cut. Doherty said it’s likely that general maintenance employees will assume their responsibilities.
Doherty said he is concerned that fewer maintenance people working on the track will reduce the safety of rail travel. CP, on the other hand, stressed that the layoffs would not affect its commitment to safety.
“The frequency of both visual inspections and ultrasonic rail flaw detection remains unchanged,” Berry said. “CP will continue to meet or exceed all regulatory requirements for track inspection and maintenance. Safety is of fundamental importance to CP and supersedes any financial metric.”
CP says that as market conditions improve it will bring back laid-off employees to meet demand. However, Doherty said he fears more layoffs are to come.
