The Minister of Labour, Steve McKinnon, rejected the request of the Canadian National Railway Company to intervene in the ongoing labour dispute between the company and the union representing railway employees.

The new decision from the Minister of Labour comes from Prime Minister Justin Trudeau ahead of a potential shutdown and strike that may begin as early as Thursday, August 22.

Industry groups have warned that a shutdown of the Canadian railways will impact large sectors of Canada’s economy, including agriculture, automotive, manufacturing, and construction.

They also warned that Canada’s international reputation as a reliable trading partner may be at risk, noting that Canadian railways transport over $1 billion worth of goods daily and account for half of the country’s exports.

In a letter addressed to the company’s legal counsel, McKinnon stated that it is the "shared responsibility" of the Canadian National Railway (CN) and the Teamsters Canada Rail Conference (TCRC) to negotiate in good faith and work diligently towards a new collective agreement.

McKinnon wrote, "I am confident that with continued efforts, an agreement can be reached immediately. The government firmly believes in the collective bargaining process and trusts that mutually beneficial agreements are within reach at the negotiating table."

He added, "To support this process, mediators from the Federal Mediation and Conciliation Service remain available to work with you to facilitate productive negotiations and help bridge any gaps."

In a statement provided to CTV News, the company expressed that it is "frustrated" by the government's decision not to intervene in the labour dispute, but hopes that the Canadian Radio-television and Telecommunications Commission will heed the Minister's strong message that they must take negotiations seriously and engage meaningfully at the bargaining table.

Johnathan Abekasis, Director of Media Relations at the railway, said, "The Minister needs to reconsider his decision if they do not."

CN requested federal government intervention last week "to protect the Canadian economy from the effects of prolonged uncertainty," accusing the Canadian Radio-television and Telecommunications Commission of not engaging "meaningfully" at the negotiating table.

In a statement released last week, the company wrote, "Unless there is immediate and meaningful progress at the bargaining table or binding arbitration, CN will have no choice but to begin a gradual and staged shutdown of its network, starting with a prohibition on hazardous goods, culminating in a shutdown at 00:01 eastern time on August 22."

The union, representing nearly 10,000 workers at CN and Canadian Pacific Kansas City Railway, stated on Thursday that it agrees with McKinnon that "agreements are within reach at the negotiating table."

Teamsters Canada wrote in a statement provided to CTV News, "The only way forward is for the railways to engage in real negotiations at the bargaining table and to step back from their demands for concessions."

Paul Bouche, President of TCRC, stated that railway workers have never sought anything but a fair agreement.

"Unfortunately, both rail companies are demanding concessions that could tear families apart or jeopardize railway safety." He added that railway workers have fought for a safer and more humane industry for decades, and they will not accept going backward.

The Canadian railway insists that any of its offers regarding a new collective agreement do not compromise safety, and the company states that the union has not made any counter-offers. In the event of a complete shutdown of the railway network, the Canadian railway says, "No products coming to or leaving Canada or moving within it will be transported by rail."

The union states that it will provide a 72-hour notice in the event of any strike.

Goldie Hider, Chair of the Canadian Business Council and its CEO, joined dozens of industry groups and associations across Canada last week in urging Trudeau and McKinnon to intervene in the labour dispute.

She stated, "The simultaneous or sequential cessation of operations on both major railways will leave Canadians with access to fewer goods and products, resulting in rising prices and exacerbating affordability challenges." Hider, who described the scale of the potential disruption as "terrifying," wrote, "Failing to act swiftly would also jeopardize the livelihoods of millions of workers."

Hider added, "Disruption to our rail system will have an immediate impact on thousands of businesses from coast to coast and on passengers in many major urban centers." "All ports, logistics operators, warehouses, and suppliers in Canada will be affected, while prolonged stoppages will quickly lead to supply shortages for many industries, forcing businesses to suspend their operations and lay off their employees."