After two years of contentious negotiations and two national strikes, Canada Post and the Canadian Union of Postal Workers (CUPW) reached agreements in principle on Friday, suspending strike action pending a union membership vote.

If the two sides are not able to come to terms on the language of the agreements, then a strike could still potentially take place ahead of Christmas.

Canada Post and the Canadian Union of Postal Workers (CUPW), representing 55,000 employees, have negotiated for 23 months. A two-week national strike preceded the rotating strikes that CUPW began on Oct. 11.

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This follows a ‘no’ vote on Canada Post's "final" contract offer—a 13% four-year wage hike plus a $1,000 bonus.

Canada Post offers 13% pay hike to workers in bid to avoid strike

A 32-day work stoppage last November caused delays in the delivery of approximately 190,000 passports and 1.65 million tax notices.https://t.co/MJlxgusAJV

— Rebel News (@RebelNewsOnline) May 22, 2025

Canada Post's previous offer reflected a May 16 report indicating the post office was “effectively insolvent or bankrupt.” The Union countered that no meaningful negotiation had taken place.

CEO Doug Ettinger stated that the Crown corporation requires a "bold new approach" for financial sustainability, warning that the "status quo," built for the era of letter mail, has led the postal system "to the verge of financial insolvency" and is "not an option." 

Minister Patty Hajdu, backed by a Public Works briefing, warned that another postal strike would "significantly and immediately impact" millions of Canadians, small businesses, and charities, especially in rural areas. Cabinet intervened following a 32-day pre-Christmas strike that cost the Crown corporation $208 million, and a 35-day stoppage in 2018 costing $110 million.

Ottawa announced changes to the Crown corporation in September, including closing some rural post offices and replacing door-to-door delivery with community mailboxes.

Financial losses are rising and parcel volume is dropping as angry customers switch to competitors. The Canadian Federation of Independent Business reported that 13% of businesses stopped using Canada Post after the 2024 strike.

One Victoria business owner told CBC News that he previously relied on Canada Post for 98% of his shipping but reduced it to about 40% after a past strike, stating, "I don't feel I can rely on Canada Post.”

Lemon & Lavender, a bustling locally-owned Toronto storefront, is seeing a jump in both in-store and online holiday sales. Owner Christina Kotiadis, however, is choosing a more expensive private courier over Canada Post for Christmas deliveries. She notes, “Obviously trust has dropped in consumers [and] in businesses for Canada Post.”

Despite the deal with CUPW, Kotiadis remains skeptical of the courier. "It’s very difficult for us to try and relay to the customer if a package is going to be delivered to them or if a greeting card is going to reach their grandchild."

Taxpayers are bailing out another Crown Corporation amid continued financial struggles. Canada Post, whose 55,000 workers went on strike last year, have gone radio silent following the handout.https://t.co/0Ta9SCwVlH

— Rebel News (@RebelNewsOnline) January 26, 2025

Canada Post reported a record $541 million loss in the third quarter and requested a $1 billion federal loan, stating it will need another bailout by early 2026 once the current cash is "fully utilized" by the end of December.

Public Services and Procurement Canada provided a $1.034 billion loan in January to address Canada Post's mandatory expenses for the 2025/26 fiscal year to no avail.

The Crown corporation blamed significant losses this year on labour uncertainty, particularly the postal workers' disruption in the second and third quarters, which caused a roughly 40% decline in parcels revenue.

Canada Post has lost over $5.5 billion since 2018, having been unprofitable since 2017.

Meanwhile, Canada Post-owned Purolator recorded a profit of $59 million in the third quarter, compared to $62 million in 2024.