*

Labour Minister MacKinnon expects trains running within

days

*

Business groups and companies demanded government action

*

Teamsters union says picket lines will remain in place for

now

*

New Democratic Party opposed government's decision

(Adds Teamsters statement in paragraph 8)

By David Ljunggren and Promit Mukherjee

OTTAWA, Aug 22 (Reuters) - The Canadian government moved

quickly on Thursday to end an unprecedented rail stoppage,

announcing it would ask the country's industrial relations board

to issue a back-to-work order that should come soon.

Canada's top two railroads, Canadian National Railway ( CNI )

and Canadian Pacific Kansas City ( CP ), had locked

out more than 9,000 unionized workers earlier in the day,

triggering a simultaneous rail stoppage that business groups

said could inflict hundreds of millions of dollars in economic

damage.

The Canadian Industrial Relations Board (CIRB), which is

independent, will now consult the companies and unions before

issuing an order.

CN said it would end its lockout on Thursday at 6 p.m. ET

(2200 GMT). CPKC said it was preparing to restart operations in

Canada and further details on timing would be provided once it

received the CIRB's order.

"I assume that the trains will be running within days,"

Labour Minister Steven MacKinnon told reporters.

As well as requesting a back-to-work order, MacKinnon asked

the board to start a process of binding arbitration between the

Teamsters union and the companies, and extend the terms of the

current labor agreements until new agreements have been signed.

The sides blamed each other for the stoppage after multiple

rounds of talks failed to yield a deal.

The Teamsters union said in a statement that picket

lines would remain in place while it reviewed MacKinnon's

referral and CIRB's response. The union will consult with legal

counsel to determine the next steps, it added.

CN spokesperson Jonathan Abecassis told the Canadian

Broadcasting Corp it could take the company a week or more to

catch up on shipments.

MacKinnon's decision marked a change of mind by the Liberal

government of Prime Minister Justin Trudeau, which had said it

wanted to see the matter settled at the bargaining table.

"We gave negotiations every possible opportunity to succeed

... but we have an impasse here," MacKinnon said.

"And that is why we have come to this decision today."

RELIANT ON RAIL

Business groups and companies had demanded the government

act.

Trudeau, in a post on X, said "collective bargaining is

always the best way forward," but added governments must act

when faced with serious consequences to supply chains and the

workers who depend on them.

Canada is the world's second-largest country by area and

relies heavily on railways to transport a wide range of

commodities and industrial goods. Its economy is heavily

integrated with that of the United States, meaning a stoppage

would roil North American supply chains.

"We are pleased the government has responded to our calls to

intervene ... A prolonged stoppage would have imposed enormous

costs on Canadian business," the Canadian Manufacturers &

Exporters, an industry group, said in a statement.

The rail companies previously said they were forced into the

lockouts to avoid strikes at short notice. They said they had

bargained in good faith and made multiple offers with better pay

and working conditions.

Paul Boucher, head of the Teamsters rail union, had accused

CN and CPKC of being "willing to compromise rail safety and tear

families apart to earn an extra buck".

Unions typically do not want contracts decided through

arbitration as it removes their leverage from withholding labor

to secure better terms.

The left-leaning New Democratic Party, which has

traditionally received strong union support and props up

Trudeau's government, opposed the government's decision.

"Justin Trudeau has just sent a message to CN, CPKC and all

big corporations - being a bad boss pays off," party leader

Jagmeet Singh said in a statement.

The stoppage has crippled shipments of grain, potash and

coal while also slowing the transport of petroleum products,

chemicals and autos.

Tens of thousands of people who depend on certain commuter

rail lines into Toronto, Vancouver and Montreal were also hit by

the lockouts, since all train movement on these CPKC-owned lines

had halted indefinitely.

The stoppage was largely rooted in scheduling, availability

of labor and demands for better work-life balance, according to

the union and companies. It comes after Ottawa introduced new

duty and rest-period rules in 2023.