OTTAWA - Labour Minister Lisa Raitt says the government must act now to end a strike by 4,800 Canadian Pacific Railway workers in order to preserve the country's international reputation.

The Harper government is tabling back-to-work legislation, the third time it has intervened in a labour dispute in similar fashion in the last year.

"Simply put, the strike can't go on," Raitt told the House of Commons on Monday. "We need to get the trains running again."

She said Canada's reputation as an international business partner is at stake, and that CP Rail's business affects a million workers in the bulk shipping industry and has an impact of half a billion dollars a week on the Canadian economy.

"The work stoppage is preventing our ability to keep products moving in and out of Canada and that undermines Canada's reputation as a reliable place to do business," said Raitt.

Mediated contract talks between the railway and the Teamsters union representing locomotive engineers and conductors collapsed Sunday.

Raitt gave notice of intention to intervene shortly after last Wednesday morning's walkout halted CP's freight service across Canada, setting the stage for Monday's intervention.

The union says the company is demanding up to a 40 per cent cut in the earned pensions of employees, after making a $570 million profit last year.

"We've spent out entire careers paying for this, contributing to this and relying on this," Doug Finnson, union vice-president and chief negotiator told a news conference on Parliament Hill.

"And because the shareholders want increased value, they want to squeeze it out of our pension plan and then put it over to the shareholders."

The labour unrest comes amid front-office turmoil that saw CP's chief executive officer Fred Green and much of the old company board forced out by an investor revolt, led by New York-based investor Bill Ackman of Pershing Square Capital Management LP.

The departing CEO, who Ackman accused of running an underperforming company, ended up walking away with an $18-million severance package, a point dryly noted by Liberal House leader Marc Garneau.

Opposition critics say the Conservative government's heavy-handed use of back-to-work legislation is undermining the right to collective bargaining and will hurt the wages of all workers, unionized or not.

"If employers know they can count on the government to intervene on their side to put an end to collective bargaining, then there's less need for them to have good-faith negotiations at the bargaining table," said Peggy Nash, the NDP finance critic and a former union negotiator.

"You always have a better outcome when the two parties freely come to an agreement on their own."

Added the Liberals' Garneau: "The whole process of collective bargaining in good faith is brought to a grinding halt. The government does this every time."

Raitt, as she has done with previous labour disputes at Air Canada and Canada Post, cited the damage to the economic recovery for quickly legislating an end to work stoppages.

But she held out hope that a negotiated deal could still be found. In the case of both Canada Post and Air Canada, workers ended up returning to the job under the threat of the legislation, without actually being forced by law back to work.

The government says a prolonged strike by CP Rail workers could cost the Canadian economy $540 million a week.

"The economic impact on the Canadian economy is significant day after day," said Finance Minister Jim Flaherty.

"We're in a time of fragile economic recovery and it's important that we not have shocks within our own economy at this time, we want to make sure we continue on the path of moderate economic growth."

All the government talk of economic necessity did not impress NDP House leader Nathan Cullen.

"I don't understand why the government doesn't include workers when it talks about the economy ... people working are the economy," said Cullen.

"And this government seems to have no concern for them, particularly if they hold a union card."

He said all workers should be worried by the government's actions.

"It will suppress wages whether you're in a union or not."

Indeed, the Teamsters union claims CP management was negotiating in bad faith in the full knowledge the federal government would ride to the rescue.

"It's only because the government is going to act that CP is not at the table," said Finnson. "That's the only reason they're not here, because they think they have an insurance policy in the federal government."

And he too warned that all Canadian workers should sit up and take notice.

"If CP hits a home run on this one and they can steal our pension money, other employers are going to line up and try to do the same thing, I suspect," said Finnson.

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