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DHL Express Canada seeks exemption on use of replacement workers

DHL Express has asked Canada’s government to exempt it from new legislation banning federally regulated employers from hiring replacement workers during strikes or lockouts, saying a cessation of parcel delivery operations would significantly harm businesses and communities at a time of high economic uncertainty.

DHL Express Canada late Tuesday stopped accepting new packages and will suspend operations Friday, when the new law takes effect, in response to a work stoppage over deadlocked contract talks with unionized workers. It initially called in strikebreakers to maintain service levels after a lockout-strike moratorium expired on June 8 and both sides took action.

In a letter to Prime Minister Mark Carney and Patty Hajdu, the minister of jobs and families, DHL Express Canada said the prohibition on replacement workers shuts off a vital trade link for more than 50,000 international shipments per day, including pharmaceuticals and e-commerce products, that industries and consumers depend on. The letter was signed by Andrew Williams, the CEO of DHL Express Americas, and Geoff Walsh, CEO of DHL Express Canada, who urged Ottawa to intervene — as it recently did in the ongoing Canada Post labor dispute.

“We respectfully request … the government’s intervention under section 107 of the Canada Labor Code to allow DHL Express to continue operating while we negotiate in good faith with the union. We have witnessed similar interventions during the ongoing strike at Canada Post, and we believe such action is warranted in our case, given that we provide essential logistics services to Canadians. This intervention is critical not only for the survival of DHL Express in Canada but also for the thousands of Canadians and businesses that rely on our services. Our commitment is to continuing bargaining in good faith, and we are confident that a balanced approach to labor relations can be achieved without resorting to measures that could jeopardize the livelihoods of many,” the DHL executives wrote.

Unifor, the union representing about 2,100 independent couriers, truck drivers, warehouse pickers and clerical workers at DHL, posted the letter on its website. It castigated DHL Express for seeking special treatment from a law designed to protect workers in collective bargaining.

“Let’s be clear — DHL is not the victim here. This company locked out its own workers, forcing members to respond with strike action, and now they want the government to override the collective bargaining rights of workers,” said Unifor National President Lana Payne in a statement. “Unifor will stand firm, and we expect the federal government to do the same. No exemptions. No bending the rules.”

Labor advocates say Bill C-58 levels the playing field and prevents employers from dragging out disputes by using replacement workers.

Unifor, in a response letter to the prime minister urging against intervention, challenged the claim that DHL Express is critical to Canadian supply chains and the economy.

“To be clear, DHL is not even one of the top four express package delivery companies in Canada and DHL workers represent fewer than 0.7% of all local delivery workers and less than 15% of all courier workers in the country,” Payne said in the letter.

DHL could have protected customers by making contingency plans to shift volumes to other carriers and call centers ahead of the lockout, instead of training replacement workers days before a statutory ban kicked in, she said.

“Given this deliberate timing and detailed advanced planning, DHL cannot now say that it was taken by surprise or put at a disadvantage, as a result of the lockout or the enactment of ‘anti-scab’ legislation,” Payne wrote. “DHL appears to be asking for a free pass to avoid having to comply with the new anti-scab legislation that is the result of years of hard work on the part of unions and workers, and which was unanimously supported by parliamentarians.”

Bargaining differences

DHL Express accused Unifor of “intentionally” stalling negotiations on a new labor contract for a year so it could gain leverage when the anti-replacement worker law is implemented. Unifor denied the charge, telling officials it was bargaining in good faith despite members having authorized the union to call a strike on June 8. It said DHL Express Canada triggered the lockout because workers refused to accept concessions. Unifor subsequently implemented its own strike action.

Unifor’s demands for a 22% hourly wage increase and a 42% cost increase for owner-operator drivers over three years was exorbitant and would “jeopardize our operational viability,” DHL told the government.

DHL offered a 15% wage increase over five years, new premiums for certain job classifications, increased pension match and benefits, and increased union representation rights. It also seeks to revise the compensation model for owner-operators in response to changing market conditions. It says drivers would still receive highly competitive compensation and increased reimbursement for vehicles.

“With supply chains already strained and businesses grappling with rising costs and uncertainties, the introduction of additional obstacles could push many companies to the brink. The ripple effects of such a decision could lead to increased consumer prices, reduced availability of goods, and further job losses across the economy,” the DHL executives said in the letter.

Earlier this month, Minister Hajdu instructed the Canada Industrial Relations Board to conduct a vote of mail carriers, represented by the Canadian Union of Postal Workers, on Canada Post’s most recent contract offer. Canada Post suggested that union leadership wasn’t accurately representing rank-and-file attitudes toward negotiations, which have dragged out for 18 months. The CUPW three weeks ago implemented a no-overtime rule for members, meaning that mail carriers stop working after eight hours each day and 40 hours per week. The government agreed to go over the head of union leadership in an effort to return the postal operator to normal operations and allow it to implement reforms designed to improve delivery service and restore financial health.

Objectionable demands, according to Unifor, include forcing drivers to travel up to 62 miles to reach their routes or pick up freight without compensation, the ability to lay off employees more easily, reducing the daily minimum guarantee for drivers, and rerouting pick ups in ways that would cut pay for independent drivers.

Click here for more FreightWaves/American Shipper stories by Eric Kulisch.