A Canada Post mail carrier delivers a package on their route in Montreal in November, 2024.Christinne Muschi/The Canadian Press
Canada Post delivered early Christmas presents for its unionized workers and more lumps of coal for federal taxpayers.
The Crown corporation, which recently reported the largest quarterly loss in its history, announced Monday that it has reached tentative labour agreements with the Canadian Union of Postal Workers, or CUPW.
Those provisional deals – which include plump wage increases with inflation protection and enhanced benefits – cap two years of conflict, including bouts of labour action that created headaches for consumers and businesses across the country.
Canadians, already fed up with paying more for an unreliable postal service, are in store for more rude awakenings in the new year.
Taxpayers should expect to foot the bill for these multiyear labour deals if they are ratified by CUPW members in early 2026. But they also ought to brace themselves for yet another shakedown just to keep Canada Post solvent in the near term.
The post office is becoming a bottomless money pit.
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The tentative labour agreements carry five-year terms that expire on Jan. 31, 2029. The corresponding obligations include a wage increase of 6.5 per cent for the first year (this includes 5 per cent that was already received by postal workers), followed by a 3-per-cent augmentation in the second year.
For the third, fourth and fifth years of the contracts, annual wage increases would mirror the national rate of inflation.
The deals also include 13 personal days (yes, you read that correctly), along with improved health benefits and income replacement for employees injured on the job and those who take short-term disability leave.
Rural and suburban mail carriers would benefit from enhanced job security under their new contract. Urban postal workers, meanwhile, would maintain existing protections in their deal.
Additionally, both sides agreed on a framework for weekend parcel delivery, which had been a divisive topic, but scant details were provided about that plan.
What’s more, postal workers’ defined-benefit pension was spared from any changes. That’s remarkable because Canada Post has previously suggested that up to 30,000 employees could retire or voluntarily depart by 2035.
“Postal workers have put up an enormous fight over the past two years,” CUPW lead negotiators Lana Smidt and François Senneville jointly stated in a news release.
“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.”
Great.
Ordinary Canadians, though, are collateral damage in this fight.
Are we really to believe that these costly labour agreements are in the public interest when Canada Post is in the throes of a financial crisis?
Last January, the federal government threw it a financial lifeline, a $1-billion-plus loan of taxpayers’ money, to cover operating expenses because of an expected shortfall in revenue at the Crown corporation.
That funding was meant to last until March 31, 2026, which marks the end of the federal government’s fiscal year. But Canada Post revealed last month that money is likely to run out by Dec. 31 of this year because, you guessed it, months of labour strife are taking a toll on its revenue.
“Canada Post will therefore need to access short-term financing facilities to maintain solvency and support operations over the following 12 months,” its Nov. 21 news release stated.
That disclosure came on the same day that Canada Post posted a loss before tax of $541-million for the third quarter of 2025.
It was a record-setting quarterly loss that left the company deeper in the red as strikes pushed customers to turn to competitors, causing a 40-per-cent drop in parcel revenue.
For the first nine months of 2025, Canada Post recorded a loss before tax of $989-million. That compared with a loss before tax of $345-million in the same period a year earlier.
“The company is facing the most severe and challenging financial situation in its history,” its release stated.
So, naturally, the Crown corporation agreed to five years of higher labour costs even though it vowed to save hundreds of millions of dollars a year.
The Carney government, which has previously said taxpayer-funded bailouts are not a long-term solution, must explain how these deals jibe with its plan to modernize the postal service.
CUPW is being rewarded for aggravating Canada Post’s financial woes. As it turns out, one can get blood from a stone.