Canada Post workers vote overwhelmingly to accept new contract

MONTREAL — After more than two years of labour strife, postal workers have given the thumbs-up to a new contract, casting their ballots overwhelmingly to approve a tentative agreement that will boost their wages nearly 10 per cent in the first 24 months.

The union representing some 55,000 Canada Post employees said Monday that more than four in five members voted in favour of the five-year deal, which includes wage increases of 6.5 per cent and three per cent in the first two years. It also locks in hikes that match the annual inflation rate in years three through five, on top of enhanced benefits and a weekend parcel delivery model that some leaders had opposed.

About 86 per cent of rural and suburban mail carriers voted to accept the contract, and 89 per cent of urban workers gave it the green light, according to the Canadian Union of Postal Workers.

The parties will “soon sign” the two retroactive agreements, which will expire on Jan. 31, 2029, Canada Post said.

The deal marks the denouement of a drawn-out saga of grinding negotiations and rotating strikes amid the Crown corporation’s push to overhaul its business model in the face of declining letter mail and mounting financial losses, which reached $5.4 billion between 2018 and 2025.

Canada Post and the union have long sparred over wages and structural changes to the postal service, with workers taking to the picket line repeatedly throughout the bargaining process. Both sides agreed not to launch any strikes or lockouts while the six-week ratification vote took place.

About 60 per cent of the union board endorsed the proposed collective agreement, saying it ensures job security, but the union’s president had asked members to reject it, arguing it rolls back rights and compensation.

“We still have our work cut out for us,” said president Jan Simpson in a bulletin to members Monday.

“To win the fights ahead, prepare for the next round of bargaining and mobilize against the government’s attacks on our public postal service, we all have to regroup and unite in our struggle.”

In a statement, Canada Post CEO Doug Ettinger said the new deal offers stability and a path to “restore confidence in the postal system.”

“While the process was challenging, these negotiated agreements recognize that Canada Post needs to change,” he said.

Amid declining letter demand and stiff competition for parcels, the Crown corporation has pledged to modernize through reforms that include more community mailboxes, weekend parcel delivery and possible post office closures.

The contract means the two sides have cleared a major hurdle that had disrupted service and hurt business since 2024, said Ian Lee, an associate professor at the Sprott School of Business at Carleton University.

“In the short run, it’s enormously beneficial,” he said. “They have had so much instability and unreliability in the last two or three years.”

Longer term, the same structural challenges remain, especially plummeting letter volumes.

The average Canadian household received two letters per week last year, down from seven in 2006. Yet the postal union counts slightly more members now than it did 20 years ago, Lee noted.

“Young people aren’t going to suddenly say, OK, I’m going to give up my cellphone and I’m going to write my dear grandmama letters each week,” he said.

The other issue is competition for parcel delivery. While the market for packages has boomed in recent years, Canada Post’s shipments have shrunk — by nearly a quarter between 2020 and 2023, and by another 33 per cent last year alone, according to a pair of annual reports.

The Crown corporation said a month-long strike in the lead-up to the 2024 winter holidays and “continued labour uncertainty” in its wake caused the plunge in 2025, as Amazon and other competitors seized on rising demand for next-day doorstep deliveries.

On Monday, mom-and-pop shops cheered the new agreement.

“This is welcome news,” said Dan Kelly, president of the Canadian Federation of Independent Business.

“Many small firms still depend on Canada Post as a low-cost way to send marketing material, move money between businesses and send packages to consumers in every community across the country.”

The road to ratification has been a long one.

In December 2024, the federal government asked the Canada Industrial Relations Board to step in to quash a month-long strike, and struck an Industrial Inquiry Commission to find a path forward.

That probe, led by William Kaplan, made a series of recommendations that were later adopted and rolled out in a suite of sweeping changes to Canada Post’s mandate.

Announced in September, the overhaul lifted a moratorium on community mailbox conversions, authorizing the mail carrier to convert the remaining four million addresses that still receive door-to-door delivery. The government also announced an end to the freeze on rural post office closures — some locations are now surrounded by suburban subdivisions — that has been in place since 1994, covering close to 4,000 outlets.

On Monday, Procurement Minister Joël Lightbound said the agreement marked a milestone for the Crown corporation.

“This is an important moment for workers, for Canada Post, and for the millions of Canadians and businesses who rely on a stable and reliable postal service every day,” he said in an emailed statement.

On Friday, the postal service reported that it lost $205 million before taxes in the first quarter of the year as it moves forward with the overhaul.

Last month, the federal government handed $673 million to Canada Post to keep the money-bleeding mail service afloat for the current fiscal year.

That amount was carried over from the roughly $1 billion Ottawa authorized in a massive funding top-up earlier this year. It also followed last year’s initial $1.03-billion cash injection, which failed to sustain the postal service past early February 2026.

This report by The Canadian Press was first published June 1, 2026.

Christopher Reynolds, The Canadian Press