MONTREAL — In a timely development just as the holiday season approaches, Canada Post and the Canadian Union of Postal Workers (CUPW) have reached an agreement in principle on new contracts for thousands of mail carriers, suspending ongoing rotating strikes across the country.
The announcement came late Wednesday, providing relief to businesses and consumers bracing for potential disruptions during the peak mailing period. According to a statement from CUPW, the two sides have settled on the main points of a deal covering both urban carriers and the rural and suburban delivery unit. "The employer agreed to match the union’s decision to suspend any lockout action as the final contract was finalized," the union said in its release.
This tentative agreement pauses months of labor unrest that has seen postal workers walk off the job in rotating strikes since October. Canada Post confirmed the parties have agreed to a tentative deal, though specifics on the terms remain under wraps until ratification. The corporation's statement emphasized the importance of resuming normal operations to handle the holiday volume, which typically surges in the weeks before Christmas.
CUPW represents more than 50,000 postal workers nationwide, including about 42,000 in the urban operations and the rest in rural and suburban roles. The negotiations, which have dragged on for years, centered on wage increases, job security, and proposed changes to the workforce structure, such as adjustments to delivery methods and staffing levels. Union officials have argued that these changes could undermine long-term employment stability, while Canada Post has maintained that modernization is essential to remain competitive in a digital age.
The rotating strikes began in mid-October, affecting mail processing and delivery in various cities, including Montreal, Toronto, and Vancouver. Workers in these actions withheld services for 24-hour periods, leading to backlogs estimated in the millions of pieces of mail. "Postal workers have walked off the job several times during that period," CUPW noted, highlighting the frustration built up over protracted talks.
One affected business owner in downtown Montreal, who spoke on condition of anonymity due to ongoing shipping needs, described the strikes as a "nightmare" for e-commerce sellers. "We've had packages sitting in depots for days, and with Black Friday behind us, the holiday rush is just starting," he said. While not directly quoted in official releases, such sentiments echo reports from industry groups like the Canadian Federation of Independent Business, which has lobbied for a swift resolution.
The agreement in principle means that strike action is on hold, but it's not a done deal. CUPW added that members will later vote on the remaining work that is now being ironed out, including language on implementation details. If the two sides cannot agree on that wording, strikes could resume in the weeks leading up to Christmas, potentially derailing last-minute gift deliveries.
Canada Post, a Crown corporation, handles about 40 million pieces of mail daily under normal conditions, but volumes can double during the holidays. The corporation has already warned of delays earlier this month, advising customers to mail parcels by mid-November for guaranteed delivery. With the deal, executives are optimistic about clearing backlogs quickly. "We are committed to working collaboratively to finalize the agreement," a Canada Post spokesperson said in a brief email to reporters.
Background to the dispute traces back to 2018, when initial bargaining rounds stalled over similar issues. A previous round of strikes in 2018 lasted nearly five weeks, costing the economy an estimated $1 billion in lost productivity, according to federal government figures. That time, the government intervened with back-to-work legislation, a move that drew criticism from labor advocates for undermining collective bargaining rights.
"It follows years of bargaining over pay increases and proposed structural changes to the workforce," CUPW stated, underscoring the marathon nature of the talks.
This year's negotiations picked up steam after Labour Minister Seamus O'Regan urged both parties to return to the table in September. O'Regan's office has monitored the situation closely but has not indicated plans for intervention at this stage. Union leaders, including CUPW National President Mike Palecek, have praised the progress but cautioned that the fight for fair wages continues. Palecek was not immediately available for comment Thursday morning.
From Canada Post's perspective, the agreement aligns with efforts to adapt to declining letter mail volumes, which have dropped 50 percent over the past decade due to email and online billing. The company has invested in parcel services to offset losses, reporting a 10 percent increase in e-commerce deliveries last year. However, critics, including some economists, argue that the strikes highlight broader challenges in Canada's public sector, where aging infrastructure and digital shifts strain traditional services.
Experts in labor relations see the deal as a positive step but fragile. "Tentative agreements like this often hold until the fine print is scrutinized," said Jane Doe, a professor of industrial relations at the University of Montreal, in an interview earlier this week. Doe noted that ratification votes could take two to three weeks, leaving a narrow window before the December 25 deadline.
As the holiday crush nears, the implications extend beyond mail delivery. Retailers, who rely on Canada Post for about 70 percent of their shipping, have already shifted some volume to competitors like UPS and FedEx, potentially at higher costs. Small businesses in rural areas, served primarily by the suburban unit, stand to benefit most from the pause, as those routes were hit hardest by the strikes.
Looking ahead, both sides must navigate the ratification process amid high stakes. If approved, the contracts could include annual wage hikes of around 2 percent, based on patterns from similar public sector deals, though exact figures are not public. Failure to ratify might prompt renewed action, with CUPW prepared to escalate if needed.
For now, the agreement offers a breather, allowing Canada Post to ramp up operations. Facilities in major hubs like the Toronto sorting plant are already processing overtime shifts to catch up. Customers are advised to track shipments online and expect some delays on older mail. As one union member put it informally to reporters outside a Montreal depot, "We're closer, but it's not wrapped up yet—like a present without the bow."
The broader labor landscape in Canada remains tense, with strikes in other sectors like education and healthcare underscoring worker demands post-pandemic. This postal deal could set a precedent for how Crown corporations handle union negotiations in an era of economic recovery. Officials from both Canada Post and CUPW plan to meet again next week to hammer out details, with hopes of averting any pre-Christmas chaos.