Canada Post reports $ 407 million every quarterly loss, blames the overtime ban of the Union

Canada Post Corp. recently announced a significant loss of $407 million before tax in the second quarter, attributing the downturn to a sharp decline in package volumes and revenue. This marks the largest quarterly loss in the Crown Corporation’s history.

The decrease in package volumes and revenue, which both fell by approximately 37 percent compared to the same quarter last year, has been linked to the overtime ban imposed by the Canadian Union of Postal Workers. The ban, which began on May 23rd, has caused uncertainty for customers and has had a direct impact on package delivery results.

In addition to the challenges posed by the overtime ban, Canada Post has been facing ongoing struggles due to the decline in letter mail deliveries and increased competition from cheaper alternatives in the package delivery market.

The postal service reported that more than 50 percent of the year-to-date losses occurred in June when occupational insecurity was at its peak. This uncertainty led to a shift in package volumes to competitors who could offer more reliable delivery services.

In an effort to stabilize its financial situation, Canada Post secured a loan of around $1 billion from the federal government in January, with an additional $500 million loan obtained in July. Despite these measures, the postal service recorded a total loss of $841 million before tax for the entire year of 2024.

Negotiations between Canada Post and the Canadian Union of Postal Workers have been ongoing since November 2023, with no collective agreement reached for the 55,000 postal employees. A 32-day strike by union workers in late 2024 further exacerbated the situation, prompting government intervention to mandate a return to work and extend the collective employment contract.

Recent talks between Canada Post and CUPW have focused on wage increases and the contentious issue of weekend package delivery. While the postal service is offering a 13 percent wage increase over four years, the union is seeking a 19 percent increase with a significant bump in the first year. Disagreements also persist over the use of part-time versus full-time employees for weekend deliveries.

Despite the challenges faced by Canada Post, the union has pushed back against claims that the recent losses are solely attributed to the overtime ban. Both parties are set to resume negotiations with the assistance of federal mediators in an effort to reach a resolution.