Canada Post and the Canadian Union of Postal Workers (CUPW) have announced a major breakthrough in their long-running labour dispute, reaching tentative agreements that promise significant wage increases and avert immediate strike action. The deals, announced on Monday, cover both the Urban Postal Operations and Rural and Suburban Mail Carriers bargaining units.
Details of the Tentative Agreements
The proposed contracts, if ratified, will be in effect until January 31, 2029. A key feature is the wage structure: a substantial 6.5 per cent increase in the first year, followed by a three per cent hike in the second year. For the final three years of the agreement, wage increases will match the annual inflation rate.
Beyond wages, the tentative agreements include enhanced benefits and introduce a new weekend parcel delivery model. Crucially, both sides have agreed that no strike or lockout action will occur during the upcoming ratification process, ensuring service continuity for Canadians.
Path to Ratification and Union Stance
CUPW’s national board is recommending that its members accept the deals. Ratification votes for the union's approximately 55,000 members are scheduled to be held in early 2026.
"These outcomes reflect the strength and solidarity of postal workers," said CUPW national president Jan Simpson. "In the face of extraordinary challenges, we stood together, secured meaningful improvements and pushed back on significant rollbacks."
Ending Years of Labour Strife
Finalizing these agreements in the new year would conclude more than two years of turbulent negotiations between the financially struggling Crown corporation and its largest union. The two sides had been deeply divided over wages and proposed structural changes to the postal service's workforce, including the use of more part-time workers and expanded seven-day-a-week delivery.
The bargaining process was marked by disruptive job action, including a strike ahead of the holidays last year. Workers have been back on the job since the union and company arrived at an "agreement in principle" about a month ago.
The deal comes at a critical time for Canada Post, which is facing severe financial pressure. Its most recent quarterly report in November revealed a record before-tax loss of $541 million. The corporation received a $1 billion federal loan earlier this year intended to fund operations through March 2026, but it now expects those funds to be depleted by the end of this year.
