ivisions that had split the mainstream labour movement into the Canadian Congress of Labour (CCL) and the Trades and Labor Congress (TLC) began to recede during World War II. First, wartime conditions brought the TLC and CCL together in campaigns to lobby governments on labour issues. On the thorny question of industrial unionism, the TLC softened its position. Some of its own unions were adopting the industrial model, often because of fierce competition with CCL affiliates. By the early 1950s, this costly and divisive raiding of one another's affiliated unions forced union leaders to search for a compromise. In 1953, a unity committee composed of CCL and TLC leaders started negotiations. Similar discussions were occurring in the US where an agreement was reached to merge the American Federation of Labor (AFL) and Committee for Industrial Organizing (CIO) to form AFL-CIO. In March 1955, negotiators in Canada announced a similar decision.

On 23 April 1956, 1,620 CCL and TLC delegates, representing over a million union members, met in Toronto to found the Canadian Labour Congress(CLC). Several months later, labour unity received another boost when the One Big Union and several other independent unions, including the Locomotive Firemen and the Railway Trainmen affiliated with the CLC. Across the country, local and provincial TLC and CCL councils followed the lead of the national organizations and merged. Two decades of frustrating competition between Canada's two largest labour organizations finally had ended. Now only the Catholic unions of Quebec remained outside the CLC.

The formation of the CLC strengthened the position of labour in Canadian society. Union members became important allies of others in Canada, such as the co-operative movement campaigning for a national health care system, universal social assistance programs, workers' compensation, minimum wage laws, improved pension and unemployment plans, and other related programs. The CLC pursued these issues through educational programs and by lobbying federal and provincial governments. It also called for a labour party to replace the Co-operative Commonwealth Federation (CCF), which had faded considerably in popularity since the end of World War II.

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