After a long process of negotiations, the Canadian Union of Postal Workers (CUPW) and Canada Post reached a tentative agreement just before the holidays. Postal workers have yet to ratify the agreement but the union and employer have agreed that no strike or lockout activity would occur during the ratification process.
Postal workers have been without a contract since December 2023 and negotiations have dragged on as Canada Post grappled with shrinking revenue.
In November, Canada Post reported a $541-million loss before tax in the third quarter of 2025 but it has been operating at a loss for years.
In response to their fraught financial situation, Canada Post had made a “final offer” to the union in July of 2025 that included a 13 per cent wage increase over four years. However, the deal also gave management the power to reallocate activities between mail routes with no additional compensation for mail carriers, close all retail counters staffed by CUPW members and require new employees to work six consecutive months full-time before they could access their defined benefit pension.
“Members’ collective action and resilience continue to be the foundation of CUPW,” Jan Simpson, the union’s national president, said in a year-end statement. “…We have defended our rights, amplified our voices, and kept the values of fairness, equity, and public service at the forefront.”
The new collective agreement covers five years and promises a 6.5 percent wage increase in the first year, a three per cent increase in the second year, and wage adjustments indexed to inflation in the years after that.
The tentative agreement has no ‘load-levelling’ for either bargaining unit which would have affected mail routes, includes protections for 393 retail counters and does not have any changes to the defined benefit pension program.
“Postal workers have put up an enormous fight over the past two years,” CUPW lead negotiators Lana Smidt and François Senneville wrote on the union website. “But in the face of repeated attacks from a federal government intent on stripping us of our rights to collective bargaining and an employer that wanted to gut our collective agreements, we stood strong.”
While postal workers now have a tentative collective agreement to vote on, the struggle to protect the public post office continues. This recent round of negotiations showed Canada Post envisions achieving financial stability through cuts that could impact employees and customers alike.
CUPW’s vision for achieving financial stability at the Canada Post involves diversifying services and streams of revenue. CUPW’s suggestions include expanding into banking, financial, and insurance services, reintroducing the Food Mail Program in the north, providing grocery delivery more generally, turning post offices into community hubs, especially in more isolated regions, using letter carriers as a check-in service on Canada’s aging and disabled population and expanding into providing passport and other government services.
A December report from the Canadian Centre for Policy Alternatives (CCPA) highlighted that diversifying services has proven successful for other postal offices around the world. The report found that the world’s highest revenue-generating postal services earn the bulk of their revenues from services other than lettermail and parcel delivery.
