Canada’s postal workers have switched gears in their ongoing labor battle with national courier Canada Post, halting the delivery of unaddressed direct mail and ending its nationwide overtime ban that had been in place since May. Both actions went into effect Monday.
In response, Canada Post stopped accepting direct mail items in its network. Known as Neighbourhood Mail, the agency’s direct mail offering includes the delivery of business cards, self-mailers, business flyers, catalogs and postcards, as well as unaddressed publications like magazines and community newspapers.
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This means that until further notice, no Neighbourhood Mail items will be accepted for drop-off at plants, depots, post offices or other Canada Post facilities.
All delivery vehicles intending to drop off direct mail will be turned away, the company said. In addition, items currently in the network will be kept in storage.
All other Canada Post products continue to be processed and delivered as normal. Parcels and addressed items, including personalized mail, postal code targeting mail and transactional mail, will not be affected.
The Canadian Union of Postal Workers (CUPW), the union representing 55,000 of the country’s postal workers, first announced its shift in priorities Friday.
“Canada Post needs to get back to the table,” CUPW national president Jan Simpson said during a press conference in Ottawa.
In response, Canada Post said it was “disappointed” in the CUPW, claiming that the courier heard about the decision via the news conference.
“This decision will impact the thousands of Canadian businesses that reach their customers with information and offers through the mail,” said Canada Post in a statement Friday. “This latest strike activity will only increase the uncertainty that is having a major impact on the business.”
According to the Canadian Federation of Independent Businesses, around 20 percent of small businesses across the country use mailed flyers to promote store openings and sales, particularly to older demographics and rural communities.
The courier said the gap between both negotiating parties is substantial.
Canada Post and the CUPW last met with federal mediators on Aug. 20, where the union presented its latest counteroffers to the company.
The offers called for higher wage and benefit increases than what Canada Post proposed in May, which it called its “best and final offers” at the time. That included a nearly 14 percent wage hike over four years, and additional part-time jobs for weekend work. The CUPW has sought a 19 percent raise for its union contingent, and has been critical of the shift to part-timers as the carrier expands further into weekend delivery.
After the government forced a vote on the contract, the union shot down the offers in early August. In response, during the Aug. 20 meeting, the courier increased the wage and benefit offerings from the May proposal. But the CUPW did not budge from its own terms.
“It’s been almost four weeks since we provided Canada Post with our latest global offers, and we’ve yet to hear anything meaningful in response,” claimed Simpson in a Monday statement. “With Canada Post abandoning bargaining once again, it gives us no choice but to ramp up the pressure. We can’t bargain with ourselves. Canada Post must come back to the bargaining table with a realistic attitude and work with the union’s offers.”
Canada Post called the union’s desires “unaffordable,” urging the union to “revisit its offers to align with the realities confronting the company.”
The poor financial state of Canada Post has been a backdrop to the ongoing negotiations, with the commission tasked with analyzing the Crown corporation’s labor disputes acknowledging that it was “effectively insolvent or bankrupt.” To kick off 2025, the Canadian government loaned the courier $1 billion ($727 million) so that it could continue operating.
Recent earnings results have suggested that Canada Post’s problems have only gotten worse amid the negotiations.
Canada Post recorded a pre-tax loss of $407 million ($296 million) in the second quarter, the largest such profit hit incurred by the postal service ever. For the first six months of the year, loss before tax totaled $448 million ($326 million).
Over 50 percent of year-to-date losses occurred in June, when labor uncertainty was at its peak, the agency said when it reported earnings in late August.
During the second quarter, parcels revenue fell 36.7 percent to $475 million ($345 million), as volumes declined by 25 million pieces, or 36.5 per cent, compared to the same period of 2024.
“From 2018 to the second quarter of 2025, the company has posted cumulative losses from operations of more than $5 billion ($3.6 billion),” said Canada Post in a statement. “Without significant changes, these losses will continue and will be borne by taxpayers, which is not sustainable.”
