Thousands of workers at CP Rail will be getting some very bad news just before the holiday season as the Calgary based rail company announced layoffs due to restructuring.

CP Rail announced it would be shedding about one quarter of its workers, up to 4,500 jobs, as it struggles to improve the service and grow the business.

The company is expected to be releasing more details on Wednesday about the cuts.

About 300 workers who keep the trains running at the Ogden yard have already lost their jobs but over 1,000 more workers are expected to lose theirs by the end of the year.

Tom Murphy with CAW Local 101 says they saw 40 people out of work last month, then more this week. “20 this week and another 20 from the Ogden shop facility.”

CP has also decided that it will be changing the way it assembles trains that could cost even more Calgarians their jobs.

Doug Finnson with Teamsters Calgary says there is a dispute over 35 jobs in their operations department. “They are trying to move out to Swift Current and Lethbridge to diversify their switching operations.”

CP employs nearly 20,000 people and they say most of their cuts will come through attrition and ended contracts.

It says that it will lower costs and make operations more efficient.

The company's President and CEO E. Hunter Harrison outlined the restructuring plan going forward and says the changes will improve service, increse efficiency, lower costs and allow for growth.

On Tuesday Harrison said in a release, “We now have a leadership team that understands the urgency of making change and improving the culture of this organization.”

“CP has many talented railroaders who want to win. Together we are squarely focused on improved service and becoming the low cost carrier. This will allow us to continue to grow with our customers.”

In addition to job cuts, the restructuring plan includes:

  • New longer sidings program will improve asset utilization and increase train length and velocity – The plan will allow CP to move the same or increased volumes with fewer trains, and is expected to save over 14,500, or 4%, crew starts
  • Explore options to maximize full value of existing and anticipated surplus real estate holdings
  • Relocate CP's current corporate headquarters in downtown Calgary to new office space at CP-owned Ogden Yard by 2014
  • Review options for the Delaware & Hudson (D&H) in the U.S. Northeast, while maintaining options for continued growth in the energy business
  • Announced earlier, CP is seeking expressions of interest on the 660-mile portion of the former Dakota, Minnesota & Eastern (DM&E), west of Tracy, Minnesota

“The organization is driving to a culture of intense focus on operations. Services will be what drives this organization, by providing a premium, reliable product offering through a lower cost operation.”

The company promises investors that the changes will improve cash flow by 4.7 percent in each of the next three years.