As Canadians prepare for the holiday season, mail deliveries will experience disruptions. After a negotiation standoff between the CUPW (Canadian Union of Postal Workers) and Canada Post, postal employees will begin their strike on 15th Friday, 2024, at 12:01 a.m. E.T.
In a country where mail deliveries are an essential part of daily life, the strike could have a considerable impact, especially during the busiest time of the year.
The strike affects everyone — consumers waiting for packages, local businesses relying on deliveries, and rural residents who don’t have alternative parcel services like UPS, FedEx, and Shippie, among others.
The steaks are also high for the mailing company. Canada Post has had a bad year already, losing $490 million in the first half of 2024. The strike is going to complicate things.
The government wants to avoid getting involved, at least for the moment. According to comments by the Labor Minister Steven MacKinnon,
“Our government strongly believes that the best agreements are those reached at the bargaining table, and we encourage both sides to continue working towards a fair settlement.”
He's taking a hands-off approach. How long will this last? Will MacKinnon finally intervene like he did with the port lockouts? The minister imposed a binding arbitration to end the work stoppages in Quebec and B.C.
Perhaps the Canada Post management hopes the minister will intervene and force a similar stunt against the Canada Union for Postal Workers. The Crown corporation is reluctant to meet the union's demands.
On the other hand, the CUPW is hopeful that Canada Post will back down and adhere to their demands. Their confidence comes from the fact that perhaps this time, they won’t fall for the binding arbitration trick like in 2018.
The Justin Trudeau administration introduced back-to-work legislation, forcing the postal workers back to work. That's why the union is so adamant about binding arbitration.
The New Democratic Party (NDP) supports the union, insisting they will not support a back-to-work legislation. Unlike in the past, the federal minority will need the support of other parties to pass the legislation.
Contract negotiations between Canada Post and the Canada Union of Postal Workers have been ongoing for a year. But, as Jan Simpson (the Union’s President) puts it, “There hasn’t been much movement.”
The union claims their demands offer real solutions. Among several others, the union’s proposals cover fair wages, the right to retire with dignity, health and safety for the workers, and expansion of services at post offices.
The union’s proposals are divided into two offers: for urban workers and the Rural and Suburban Mail Carriers (RSMC) members.
Here’s a detailed outlook of the union’s demands:
They demand a wage increase as follows: 9 percent (year 1), 5 percent (year 2), 4 percent (year 3), and 4 percent (year 4). This equals 22 percent and a compounded total of 23.79 percent.
The offer also covers the following:
10 paid medical days
Rotations of duties for Groups 3 and 4
Improved protections against harassment
Full elimination of separate, sort from delivery (SSD)
Improved Staffing
Precautionary cessation of work for pregnant and breastfeeding employees
Cost of Living Allowance (COLA)
Paid meal and rest periods
Contracting in work
Improved benefits
Increased short-term disability (STDP) and injury on duty (IOD) payments
No contracting out
Time for Neighbourhood Mail
Improved protections against technological change
Service expansion projects
Wage increases as follows: Year 1 (at 9 percent), Year 2 (at 5 percent), Year 3 (at 4 percent), and Year 4 (at 4 percent). This equals 22 percent or 23.79 percent compounded.
The other offers cover the following:
Guaranteed 40-hour work-week
Job security
Precautionary cessation of work
Meal and rest periods in line with Group 2
An hourly rate system with proper time values that meet our needs
Improved protections against technological change
Increased short-term disability (STDP)and injury on duty (IOD)payments
Maximizing and maintaining 8-hour routes
RSMC's involvement in service expansion projects
Pensionable hours for all hours worked
10 paid medical days
Cost of Living Allowance (COLA)
Corporate vehicles for all RSMCs
Improved Rights for On-Call Relief Employees (OCRES)
No contracting out of RSMC work
Improved staffing and coverage of absences
Improved benefits
The CUPW blames Canada Post for stalled negotiations. The official statement on their website protests that,
“Canada Post has not backed away from its numerous rollbacks, including two-tier pensions, vacations, and benefits, and its demand to move from a 5-year wage chart to a 7-year wage chart.”
On the other hand, Canada Post’s management claims the union’s demands are unrealistic, considering the company’s recent financial woes. The company has been falling behind in the parcel delivery market, and thus, the union should be reasonable.
The corporation claims to have submitted proposals on several items to binding-interest arbitration. But, the union criticized this, accusing Canada Post of only focusing “on pushing many of their issues to binding arbitration.”
Jan Simpson claims that “arbitrated contracts are never good for anyone.”
NOTE: Binding arbitration in a strike is when the employer and the union agree to bring a third party (arbitrator) to decide on the terms of the new collective agreement.
The union doesn’t want a repeat of 2018. Despite stretching the strike to about four weeks, the Canada Union of Postal Workers was ‘forced’ back to work after Elizabeth McPherson, a former chair of the Canada Industrial Relations Board, was brought in. She issued a decision on collective agreements for both rural and urban mail carriers to return to work.
The strike comes as Canada Post struggles financially. The organization has been doing poorly since 2020, when the COVID-19 pandemic reshaped parcel delivery.
They've needed help keeping up with competitors who have adopted low-cost, high-tech operational strategies.
As a result, Canada Post has lost over $3 billion since 2018, with 2023 being its second-highest loss at $748 million. Now that the strike is imminent, the Crown corporation cannot even contemplate how much it will lose in 2024.
André Hudon, Canada Post's board chair, recognizes that the Crown corporation is in a “critic's juncture" and needs to develop ways to compete in the parcel market.
If the strike is not resolved immediately, Canada Post will suffer enormous financial losses. To mitigate further losses, Jon Hamilton, the spokesperson for Canada Post, recommends introducing a seven-day delivery.
He explains that “having a flexible delivery model allows us to provide different services at affordable prices.”
On the contrary, the union has expressed concerns that such models would only interfere with postal workers' livelihoods. Instead, the CUPW prefers adjustments that support labor needs while improving operational efficiency.
Canadians should be acceptable despite the union's and Crown corporations' disagreement because Canada Post has contingencies to continue its operations.
The organization’s spokesperson, Lisa Liu, emailed the union to inform them, “While it is called a notice of lockout, Canada Post doesn’t intend to cease any of its operations.”
The parcel delivery organization will ensure that all essential services are running, meaning that Canadians will receive crucial mail, such as Old Age Security, Pension Plans, and Canada Child Benefit.
Since the union didn’t specify how they’d proceed with the strike, the corporation hopes the workers will decide to have rotating strikes. This way, they’ll find ways to ensure deliveries keep happening until they work things out with the union.
However, Canada Post sternly warned that if the union doesn’t reach an agreement, the corporation will proceed with its lockdown, and their current collective agreement will no longer apply. This will force the corporation to change how it operates.
Due to poor financial performance, Canada Post says its challenges will get harder as the strike continues. The corporation will not only make more losses but also find adjusting to a fast-growing delivery market easier.
Small businesses and people from rural areas are most affected. This makes it worse for an SMB operating in the country's rural areas.
Businesses that rely heavily on deliveries, like e-commerce, will be the worst hit. For them, delays could mean lost revenues. That’s on top of dissatisfied customers who can easily switch to alternative deliveries like UPS, Shippie, FedEx, etc.
“Because 79 percent of small businesses in Canada rely on the Canada Post services, we expect to experience a huge financial impact due to the strike,” says Jasmine Guénette, the VP of National Affairs.
Rural residents have the most to lose during this strike. Canada Post is often the only delivery service available in rural regions. The plan is for such communities to pause and halt their mail services.
However, some deliveries are mandatory since it’s a holiday, such as on Black Friday. Residents must drive to the nearest town without alternative delivery services to get their mail and parcels.
It’s also possible that delivery companies like Amazon, Shippie, etc., will jump at the opportunity to expand their services to these rural and remote areas. If you're stuck and unsure of what to do during the Canada Post strike, it’s best to check the alternative parcel companies opening up in your region.
While both sides have come to an impasse, it’s impossible to tell how things might pan out. Will the Canada Post give in? Or will the CUPW accept the proposals of the Crown corporation? Or will the government intervene?
Whatever it is, both camps are waiting to see what the other might do. While Canada Post waits to see the financial damage the strike might have on it, the CUPW is waiting to see if the Crown corporation will suffer enough to give in to its demands.
We shouldn’t expect the standoff to last long with the holiday rush approaching. At this time, delivery companies like Canada Post make the most money. They can’t afford to tolerate the strike. However, they’re not afraid to go ahead with the lockdown and stop all operations.
The government is also on the sidelines, watching how things go between these two countries. Even though he doesn’t want to, the Labor Minister MacKinnon is expected to get involved in the negotiations.
As Canada watches, the fate of Canada Post’s services and the livelihood of thousands of postal workers hangs in the balance. This strike is a stark reminder of the delicate balance required to keep a national service operational, financially viable, and fair for its employees.
In a world increasingly reliant on fast, reliable delivery, the outcome of these negotiations will affect businesses, individuals, and the broader Canadian economy for years to come.
