The Canadian government has introduced legislation that would change how labour disputes are handled in federally regulated industries, including proposed changes to the Canada Labour Code that are intended to help unions and employers reach agreements sooner and reduce economic disruptions.Bill C-39, the Building Canada Strong Act, has been tabled in the House of Commons, alongside measures to accelerate major project approvals, strengthen trade corridors and modernize ports. The government says the labour provisions will strengthen collective bargaining, reduce disruptions and protect workers’ right to strike.Jobs Minister Patty Hajdu has said the changes would reduce the government’s rate of interventions. But they could also mean greater state intervention when negotiations become prolonged, including the appointment of a “special mediator.”Canada has a long history of government intervention in labour disputes, and the proposed changes would formalize powers that have already been used in recent years. The proposed change marks an escalation in the erosion of labour rights that has been underway since the 1970s. A long history of interventionAt the centre of the changes is Section 107 of the Canada Labour Code. Section 107 has been used by the labour minister to refer disputes to the Canada Industrial Relations Board and, in some cases, end a legal strike or lockout through binding arbitration.Section 107 has been in the Canada Labour Code since 1984, but it was not used until 2011, when then-Labour Minister Lisa Raitt used it to try to settle a dispute between Air Canada and its flight attendants. Since 2023, it has been used by the government in disputes involving Canadian National Railway, Canadian Pacific Kansas City, Air Canada, Canada Post and ports on the West Coast and in Quebéc, with binding arbitration as the preferred method of resolution. Read more: Rail shutdown: What the dispute tells us about labour relations and politics in Canada Government sources told CBC News that codifying the practice could “increase private sector confidence” to signal to businesses “that Canada is a safe place to invest.”After the Second World War, Canada’s industrial relations system was designed to promote “free and fair collective bargaining.” As inflation and government deficits grew in the 1970s, governments increasingly used back-to-work legislation to end work stoppages and impose collective agreements. Labour scholars Leo Panitch and Donald Swartz describe this pattern as “permanent exceptionalism:” the treatment of labour disputes as emergencies warranting exceptional intervention. While the justification used to be inflation or the deterioration of state finances, Canada’s trade war with the United States could easily fill that role today.Why rail and port unions matterThe government has also emphasized the need to prevent disruption at ports and railways. There is no evidence that the legislation is intended to weaken organized labour as a whole, but the history of these sectors helps explain why the changes have generated tensions between governments and unions.Railway and port workers did not create the labour movement on their own, but they have been deeply connected to its development. Unions in these sectors have meant more than just economic militancy. Black trade unionism in North America, for example, developed in part through challenges to segregation on the railways. Port workers have a long history of international solidarity, including refusing to handle cargo connected to the Nationalists during the Spanish Civil War and Apartheid South Africa. More recently, dockworkers have refused to handle weapons destined for Israel. Compared to other sectors, railway and port workers have unusually strong structural power. Read more: For better or worse, unions have always taken a stand on global issues By withdrawing their labour, they can disrupt the movement of goods throughout the economy. That leverage is particularly important in a country like Canada, which exports large amounts of natural resources.It also helped explain why governments want to clamp down on strikes in these sectors. But the potential power of railway and port workers is important for all workers.The logic of the strikeThe purpose of a strike — or a lockout — is to create economic pressure that pushes one side to accept the other’s demands. Curbing the ability to strike for certain types of workers will affect more than just railways and ports. It could signal to employers in other sectors that they can bargain more aggressively or wait for the state to intervene.The history of organized labour in the U.S. and United Kingdom offers some indication of what can follow major defeats for unions. President Ronald Reagan’s firing all of striking air traffic controllers in the U.S. and Margaret Thatcher’s defeat of the miners’ strike in the U.K. are often cited as turning points in the decline of union power in those countries.There is an imbalance of power between employers and employees. That’s why workers come together to bargain collectively and withdraw their labour if necessary. While some view the employment relationship as a contract between equal parties, the Supreme Court of Canada has recognized this imbalance. The proposed changes could therefore face a legal challenge.The Supreme Court of Canada has recognized the right to strike as part of the freedom of association protected by Section 2(d) of the Canadian Charter of Rights and Freedoms. It has also struck down laws deemed too restrictive, without declaring all back-to-work or essential services legislation illegal. The question will be whether this new legislation can survive a Charter challenge, and unions have filed for judicial review of Section 107. The potential political falloutThat debate will put pressure on opposition parties, particularly those with historical ties to organized labour, such as the New Democratic Party, though that link has frayed in recent years.New NDP Leader Avi Lewis received support from some union leaders and activists during his leadership campaign, particularly from public sector unions. Most private-sector union endorsements went to Rob Ashton, whose fourth-place finish suggested that unions are less powerful in the federal party as they once were. The new labour legislation could nevertheless strengthen ties between Lewis and private-sector unions.The Conservatives might also try to take advantage. Conservative Leader Pierre Poilievre received some union endorsements during the last election, mostly from the building trades, while the party has recently removed several anti-union elements from its policy book. The Conservatives have historically taken different positions on organized labour, and Poilievre’s past statements on unions could complicate the party’s response. With the Liberals framing the changes as necessary for economic growth, navigating the issue could be even more difficult for Poilievre. Recent polling has found that 59 per cent of Canadians said they trusted Prime Minister Mark Carney to “do the right thing to help the economy,” up six points from February. Other polls have found overwhelming support for closer ties with the European Union and increased investment in infrastructure.The question, then, is how Canadians will see these labour law reforms: as part of the need to rapidly transform Canada’s economy or a gift to corporations? The answer to that will shape how the broad changes the federal government is proposing to the economy succeed or fail.Gerard Di Trolio does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.