Canada Post employees could be headed to the picket line in just over two weeks, with an extension on existing deals between the Crown corporation and the union expiring on May 22.
A strike or lockout would mark the second time in under six months that the postal service ground to a halt after 55,000 employees walked off the job for 32 days in November and December.
Canada Post’s dire financial situation means it may struggle to meet workers halfway on their contract demands, Kwantlen Polytechnic University business instructor Ulrich Paschen said.
The union initially asked for a 24 percent cumulative pay bump over four years, but Canada Post notched an $845-million operating loss in 2023. If the company raises wages while revenue continues to slide it will face potential financial collapse, he said.
The union has also lost some leverage from the delayed negotiations, Paschen said.
“The bargaining position of the union is not stronger, but weaker, because the urgency of the holiday bump is not there,” he said.
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The two sides agreed to resume negotiations last week, supported by a mediator, after bargaining broke off in March.
A possible work stoppage would come at a tumultuous time in the shipping world, as shifting U.S. tariffs and economic angst throw repeated wrenches into the gears of the global supply chain.
The strike last year left millions of parcels and letters in limbo ahead of the winter holidays, leaving businesses and consumers scrambling to ship products until a ministerial directive prompted employees to go back to work in mid-December.
Goods ranging from passports and health cards to medication, gift packages and processed food sat in sorting facilities for weeks, including after the strike due to the massive backlog. Others could not be sent, except through shipping companies that charged higher rates and paused some shipments amid the deluge of orders.
Canada Post handled nearly 8.5 million letters and 1.1 million parcels per weekday on average in 2023—and much more of both in the holiday season. That’s a big hole for private operators to plug, even if it represents just 29 percent of the parcel market, according to the Crown corporation.
The postal service said last week that providing “certainty remains our priority” for companies.
“We know this ongoing uncertainty is challenging for your business. We had hoped new agreements would be reached by this point,” Canada Post said in an update on negotiations last week.
The Canadian Union of Postal Workers called the latest round of talks “challenging.” Wages, health and safety benefits, job security and pensions remain its focus, it said.
A report by an industrial commission examining the state of the Crown corporation is due on May 15.
Convened by the labour minister and headed by veteran arbitrator William Kaplan, the inquiry aims to come up with recommendations after assessing major sticking points, including Canada Post’s financial situation, delivery model, workplace practices and ultimately, its viability.
Other key issues include the size of wage increases and a push by Canada Post to expand delivery to the weekend, with the two parties at odds over how to staff the move.
The money-losing Crown corporation has pitched the expansion as a way to boost revenue and compete with other carriers, arguing that a mix of part-time and full-time shifts will create flexibility while keeping costs down. However, the union has characterized this as an attack on full-time work.
Under former prime minister Justin Trudeau, the federal government proved more willing to intervene in recent labour standoffs. Between August and December, the labour minister issued directives that ended three major strikes or lockouts—at Canada’s two main freight railways, at B.C. ports and at Canada Post.
