April 12 (Reuters) - Canadian National Railway said on Friday it has proposed an offer that included higher hourly wages, improved vacation leave and more consistent work schedules as part of negotiations with a union representing its employees.

The offer comes as Teamsters Canada Rail Conference, the union representing about 6,000 Canadian National employees across Canada, has begun a voting process, from April 8 to May 1, over a strike mandate.

Railway workers in Canada have been in negotiations with companies over rail safety and crew fatigue, with unions including the TCRC and United Steelworkers (USW) pushing for better contracts.

Railways are critical to Canada's economy, due to its vast geography and exports of grain, potash and coal.

Contracts covering locomotive engineers, conductors and yard workers at Canadian National expired on Dec. 31, and the Teamsters are in negotiations over a new contract at the company, as well as at Canadian Pacific Kansas City.

Canadian National said it met with TCRC between April 10 and 12, during which time the company proposed the offer.

It has offered to shift to an hourly rate of pay for certain employees, effective January 2025. The proposal would mean average annual earnings of C$157,406 for conductors, compared with the average rate of C$120,790 in 2023, and a projected 23.5% rise in average yearly pay for engineers, according to the company.

"Canadian National's latest offer is a non-starter for our union. The company is still demanding to remove all safety-critical rest provisions from our collective agreement ... Our union will not bargain with safety," the TCRC said in a statement.

Canadian National last month reached a tentative agreement with USW for a new contract covering 3,000 workers across Canada, following a months-long negotiation process that began in October 2023.

(Reporting by Deborah Sophia in Bengaluru; Additional Reporting by Rod Nickel in Winnipeg, Manitoba; Editing by Krishna Chandra Eluri)