UPDATE 1-Union sets Nov. 19 strike date on Canadian National Railway if talks fail

fail@ (Adds Teamsters labor union statement, Canadian government statement)

Nov 16 (Reuters) – Canada’s Teamsters labor union has given Canadian National Railway notice that it intends to strike starting Nov. 19, the two parties said on Saturday, following a stalemate in contract negotiations.

The company, the largest Canadian railroad operator, offered the Teamsters Canadian Rail Conference a binding arbitration, which the union declined, CN’s Chief Operating Officer Rob Reilly said in a statement.

“If a settlement cannot be reached this weekend, we will once again encourage the union leadership to accept binding arbitration as an alternative to disrupting the Canadian economy,” Reilly said.

“We remain committed to constructive talks to reach an agreement without a work stoppage,” he added.

Teamsters Canada, which is affiliated to the International Brotherhood of Teamsters union, said it hopes to reach a settlement that can be ratified by its members but has issued the railway formal 72 hours notice of intent to strike.

“In the event that parties are unable to reach a negotiated settlement, over 3,000 conductors, trainpersons and yard workers will exercise their legal right to strike on Tuesday, November 19 at 0:01 a.m. ET”, Teamsters Canada said.

The union said the company wants to make employees work for longer hours and make it more difficult for them to take time off. It also said CN is demanding that the union accept a lifetime cap on prescription drug coverage.

Canada, one of the world’s biggest exporters of farm products, relies on its two main railways to move canola and wheat over the vast distances from western farms to ports. Crude oil shippers in Alberta have also increasingly used trains in the past year to reach U.S. refineries as an alternative to congested pipelines.

CN’s workers voted in favor of strike action in September after negotiations failed to produce a contract. The previous collective bargaining agreement expired on July 23.

CN said on Friday it would cut management and union jobs, as it grapples with an economic slowdown. The company will lay off 1,600 employees in the United States and Canada, according to a report by the Globe and Mail.

The Canadian government said it was monitoring the situation closely and was encouraged to see that the parties were still talking.

“The Federal Mediation and Conciliation Service, which has been working closely with the parties since June, is currently meeting with them to help them reach agreements,” Labour Minister Patty Hajdu said. (Reporting by Akshay Balan and Kanishka Singh in Bengaluru and Allison Lampert in Montreal; Additional reporting by Rod Nickel in Winnipeg; Editing by Frances Kerry and Grant McCool)