Canada relies on Canadian National Railway and Canadian Pacific Railway Ltd to move products like crops, oil, potash, coal and other manufactured goods to ports and the United States.

The company had offered a 10% improvement to wages over three years, but Executive Vice-President and Chief Operating Officer Robert Reilly said that had been rejected by the International Brotherhood of Electrical Workers (IBEW).

The company remains open to resolving the outstanding issues through an agreement or through binding arbitration, Reilly said in a letter to employees on Monday.

IBEW did not immediately respond to a Reuters request for comment.

The transporter said it implemented its "operational contingency plan" to allow the company maintain a normal level of safe rail operations.

Canadian National Railway's last major railway labor disruption was an eight-day strike in 2019 that sent shocks through the country's economy with grain and propane shipments scuttled.

(Reporting by Anirudh Saligrama in Bengaluru; Editing by Alison Williams)