Canada's top two railroads had locked out more than 9,000 unionised workers earlier in the day, triggering a simultaneous rail stoppage that business groups said could inflict hundreds of millions of dollars in economic damage.
The Canadian Industrial Relations Board which is independent, will consult the companies and unions before issuing an order.
Canadian National Railway said it would end its lockout within hours. Canadian Pacific Kansas City said it was preparing to restart operations in Canada and further details on timing would be provided once it received the board's order.
"I assume that the trains will be running within days," Labour Minister Steven MacKinnon told reporters.
As well as requesting a back-to-work order, MacKinnon asked the board to start a process of binding arbitration between the Teamsters union and the companies, and extend the terms of the current labour agreements until new agreements have been signed.
MacKinnon's decision marked a change of mind by the Liberal government of Prime Minister Justin Trudeau, which had said it wanted to see the matter settled at the bargaining table.
"We gave negotiations every possible opportunity to succeed ... but we have an impasse here," MacKinnon said.
Business groups and companies had demanded the government act.
Canada is the world's second-largest country by area and relies heavily on railways to transport a wide range of commodities and industrial goods. Its economy is heavily integrated with that of the United States, meaning a stoppage would roil North American supply chains.
"We are pleased the government has responded to our calls to intervene ... A prolonged stoppage would have imposed enormous costs on Canadian business," the Canadian Manufacturers & Exporters, an industry group, said in a statement.
The rail companies previously said they were forced into the lockouts to avoid strikes at short notice. They said they had bargained in good faith and made multiple offers with better pay and working conditions.
Paul Boucher, head of the Teamsters rail union, had accused the companies of being "willing to compromise rail safety and tear families apart to earn an extra buck".
The left-leaning New Democratic Party, which has traditionally received strong union support and props up Trudeau's government, opposed the government's decision.
"Justin Trudeau has just sent a message to CN, CPKC and all big corporations - being a bad boss pays off," party leader Jagmeet Singh said in a statement.
The stoppage has crippled shipments of grain, potash and coal while also slowing the transport of petroleum products, chemicals and autos.
Tens of thousands of people who depend on certain commuter rail lines into Toronto, Vancouver and Montreal were also hit by the lockouts, since all train movement on these CPKC-owned lines had halted indefinitely.
The stoppage was largely rooted in scheduling, availability of labour and demands for better work-life balance, according to the union and companies. It comes after Ottawa introduced new duty and rest-period rules in 2023.
