The union representing CP Rail engineers, conductors and rail traffic controllers issued a 72-hour strike notice Saturday, CP announced in a press release.
The notice means the workers can go on strike starting just after midnight on Wednesday, May 23.
The workers, which are represented by the Teamsters Canada Rail Conference, voted by a 95 per cent margin in favour of a strike in April.
The current collective agreement expired at the start of 2012 and negotations have been ongoing since October.
A strike would result in all train traffic shutting down throughout CP's Canadian network.
CP says it is looking to make changes to the pension plan and post-retirement benefits to make them industry-comparable. It says it contributed $1.9 billion over the past three years to fund its pension obligations.
The union says CP is looking at major concessions on pensions, work rules and wages. It also says it wants to resolve issues around fatigue management and work/life balance.
The strike notice comes on the heels of a takeover of the CP Rail Board of Directors by Bill Ackman, the owner of Pershing Square Capital Management, a U.S. hedgefund that owns 14.2 per cent of the company's shares.
The takeover saw the company's President and CEO Fred Green step down, along with five other board members. They were replaced by a slate put forward by Ackman and his allies.
Pershing has said it wants to reduce CP Rail's operating ratio – the percentage of revenue spent on operation – to 65 per cent from 80.1 per cent by 2015.
The Revelstoke Times Review is developing this story.