OTTAWA, AUG. 28 -- The Canadian Parliament passed tough back-to-work legislation today to end the economically crippling five-day-old national rail strike.

Officials here said they hoped that rail traffic could resume by this weekend. The legislation gives an arbitrator the power to decide all issues and mandates a minimum penalty of $7,000 per day for union officials who do not order their members back to work immediately.

Hours after the bill passed the House of Commons, hundreds of angry railway workers descended on Parliament Hill. One striker was arrested in the scuffles with a phalanx of Royal Canadian Mounted Police in riot gear.

The demonstrators carried placards saying "Run Mulroney Out on a Rail." The government of Prime Minister Brian Mulroney had sought unsuccessfully through efforts at conciliation to end the work stoppage, which began after midnight on Sunday.

Chief union negotiator Armand Passaretti, speaking to the protesters, said each of the nine unions on strike would have to advise its members on the best course of action.

Later, the Senate approved the bill, which was drafted to take effect 12 hours after passage. Labor Minister Pierre Cadieux said he felt compelled to introduce the back-to-work measures because of his concern that the rail strike was "inflicting considerable damage on the people and the economy of Canada."

Cadieux said the nation's two main railways, Canadian National Railway and CP Rail, moved about 40 percent of all freight tonnage in the country. Because wheat farmers and coal companies rely so heavily on the railways, he said, it was impossible for them to get their crops efficiently to foreign and domestic customers by alternative means.

Work rules and job security are the key issues in dispute. The 48,000 members Associated Railway Union is demanding job guarantees even if technology and a declining market render their positions obsolete.