There are intense demands from the public, the Government, Canada Post, and growing frustration within the CUPW membership for Jan Simpson, leader of the Canadian Union of Postal Workers, to compromise their stance on reliable and consistent jobs in exchange for the survival of Canada Post.
Government interference between corporations and unions is not a new concept to Canadian politics, nor is the threat of an institutional demise without a Union compromise novel either.
A brief history enables one to establish a framework for understanding the ever-growing tension that explains today’s postal dilemma. The Canadian Airlines and Canadian Auto Workers Union negotiations in 1996 are a good example. Buzz Hargrove, leader of the then CAW, was locked in a fierce negotiating battle with Canadian Airlines. Canadian Airlines decried that they would go bankrupt if the Union did not make concessions. The CAW would not compromise because the problems were due to bad business practices, not labour issues, and the Union had already made previous concessions. The employees were already making slightly less than those of other competing airlines, and making any further cuts would be wrong. It would not solve the company’s problems.
The Liberal Government decided that the Union was intransigent and against the Canadian public interest. They decided to force a vote of its members without CAW involvement.
In the end, the Government reneged on the threat, and the Union did not compromise. The Government found different sources of funding for them. Hargrove learned some valuable lessons that Unions hold dear today:
“My position has always been that unions should never give in to wage-cut demands. Any reading of labour history shows that employee concessions do not solve management financial problems. At best they are a short-term, stopgap measure. If management fails to come to grips with the real problems – poor decision-making, flawed planning, inept control of capital – the company inevitably comes back to its employees for more.”(1)
In reference to today’s problem at Canada Post and its existential financial crisis, the issue is a result of poor planning, flawed business practices, and Government policies and interference. It is not the fault of the employees. They cannot be held responsible, punished, or asked to make compromises or bail out the company for Canada Post and the Government’s errors.
Hargrove also observed and reacted to something similar happening today:
“The Government’s decision to force a vote took away the CAW’s role of representing our members in dealing with the employer. The Government had unilaterally decided that it – not the Union – would determine when and on what terms workers would vote. Without debate in the House of Commons, and with no enactment of legislation, the Government declared itself the representative for CAW members of Local 1990.
Never before in Canadian history, to my knowledge, has the federal Government intervened in this way. It was a violation of section 94 of the Canadian Labour Code, the section stating that employers are forbidden from participating or interfering in the “administration of a trade union or the representation of employees by a trade union.” To do so constitutes an unfair labour practice. The Chrétien government encouraged and supported the employer to break the law.
Gagliano [the Labour Minister] tried to put a legitimate face on this miscarriage of justice by saying that the impasse between Canadian and the CAW was a “unique” experience that called for the “employees to be allowed to decide themselves – democratically – on their future… We had to break the deadlock,” he continued, “and I believe that democracy must prevail.””
Yes, the Government did break the law in the case of Canadian Airlines, and it has made similar moves with Canada Post and others later on. Unfortunately, by the time the courts render a verdict, it is already too late. The damage is already done.
The Government’s flagrant disregard for the law regarding union activity is concerning. It sends a signal to Canadians that the Government can decide, in certain situations, to abrogate or suspend civil laws for the sake of ‘democracy,’ and there is no accountability for their actions when they contradict their own rules.
It also opened a question that Hargrove and Unions cannot answer almost 30 years later:
“The decision to force a vote stunned academics, legal experts, and union leaders and members across the country. There was no precedent. As one legal observer put it: “If governments are going to run the unions in this country, why bother having unions at all?”
And then he concluded that negotiations involving Government entities are the most difficult ones to enter.
“…our committee chairperson, Anne Davidson, remarked: “Bargaining with employers is a hell of a lot easier than bargaining with the federal government.”
Stephen Harper followed in the footsteps of Jean Chrétien, using his Prime Ministerial powers to impose final offer arbitration with a restricted set of rules that favoured Canada Post in 2011. CUPW, under duress, negotiated a compromise agreement with Canada Post to avoid its draconian edict. Harper’s actions were later taken to court, where he was found to have violated their constitutional right.
However, there were no repercussions for his actions or any compensation.
“While the decision clearly says that the Act was invalid, and has no force or effect, damage was done. The decision scraps the law, but not the agreement that we signed in its shadow.”(2)
The court case eliminated the avenue of Prime Ministerial orders in matters of employee—employer disputes afterwards. Still, the Government found another mechanism to achieve the same result: the Canadian Industrial Relations Board, clause 107.
The use of the CIRB to suspend strike activity is a controversial measure and has become a subject of active litigation in the courts.(3) In one example, the courts decided that a CIRB directive between “WestJet and Aircraft Mechanics Fraternal Association, following its Order on June 28, 2024,” does not have the power to suspend “the Union’s strike notice or its ability to strike.”(4)
Still, even after this court case, on July 16, 2025, the Government forced a vote that bypassed the Canadian Union of Postal Workers, and the Canada Industrial Relations Board became the referee.(5)
Besides Canada Post, the CIRB has been used in the last year to address labour disputes with the Ports of Montreal and Vancouver, CN and CP Rail, and Air Canada.(6) CUPE, the union representative of the Air Canada Employees, defied the CIRB order, and the Government backtracked. This defiance has likely altered the landscape of the Government’s use of the CIRB as a tool to address labour disruptions.
Canada Post CUPW represented employees rejected the company’s forced offer, leaving the negotiations in a stalemate.
Government interference has paralyzed Canada Post from making any critical decisions for 15 years. The Government has flip-flopped and reversed its fundamental direction on Community Mailboxes. Additionally, they failed to convert the Canada Post Pension Plan from a costly direct benefit plan to a Target Benefit plan, thereby leaving the company unprepared for privatization. Political fighting between the Conservatives and Liberals nixed that one. Nor would the Government admit that the Postal Transformation, which began in 2008, was close to bankruptcy by 2012. Without Government intervention, it would have collapsed.
Every plan that the Government has developed with Canada Post has failed, and Canada Post management cannot rely on the Government’s direction for a clear path. The only control in the past was managing internal labour costs.
Numerous reports and warnings came out, such as Canada Post’s 2008 Action Plan and the Conference Board of Canada’s recommendations for fundamental changes and new structures. The Government refused to act on them until now.
It has been a company in waiting for a solid direction from the Government. It finally came in the form of a bombshell from the Honourable Joël Lightbound, Minister of Government Transformation, Public Works and Procurement, on September 25, 2025.(7)
He lifted restrictions on many Canada Post operations to allow them to cut down on costs. Still, he failed to provide any information on how the Corporation would cover the company’s legislated loss of $600 million or so(8) a year to fulfill its Universal Service Obligation—something that private carriers do not have to follow.
The timing caught both Canada Post and the Union unprepared. Following the news, Canada Post withdrew its untabled offer to have more time to revise a new one based on Lightbound’s remarks.(9) CUPW quickly responded that this untimely interference with the collective bargaining process, which they were not informed about at all, was grounds for strike action, which they immediately began.(10)
The new Canada Post offer, announced on Monday, October 6, 2025, was informed by Lighbound’s words and contained an outline for downsizing, as well as weakened language surrounding job security. The Union is categorically opposed to any job cuts(11) and wants to expand permanent full-time jobs for any weekend work or new positions created.
The proposed downsizing of the company through attrition and buyouts is sad and a source of grief for all, but it respects the dignity of the workers. The idea of layoffs, with no guarantee of job security for present or future employees, is of grave concern. It does not offer the protection and needs that the traditional Canadian working class experiences.
Should the Union wage war in the courts instead, seeking justice and compensation for a blatant attack on their rights and values? They would likely win after a costly and lengthy battle, but in the end, the damage from the interference would already be done and irreversible.
Also, as demonstrated from above, Government interference, including long delays and reversals on guiding Canada Post’s operations have signficantly had a negative impact both financially, legally, morally, and almost irreversibly damaged employee relations.
Canada Post’s financial woes can be directly correlated to Government interference and they should take responsibility for their part instead of attempting to entirely pass the blame on present labour costs.
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Footnotes: * Note that all website information was gathered from October 6–7th, 2025.
(1) All quotes by Buzz Hargrove are from his book, Labour of Love: The Fight to Create a More Humane Canada. Buzz Hargrove; Wayne Skene.Macfarlane Walter & Ross. Toronto. 1998.
(2) https://www.cupw.ca/en/big-cupw-win-court-—-2011-back-work-legislation-struck-down
(3) https://www.cbc.ca/news/politics/section-107-undermines-liberal-government-1.7613820
(5) “The Canada Industrial Relations Board (CIRB) will conduct a vote in accordance with section 108.1 of the Canada Labour Code among employees working in the Urban Postal Operations (UPO) and Rural and Suburban Mail Carriers (RSMC) bargaining units to determine whether the employees eligible to vote wish to accept or reject the Canada Post Corporation’s (Canada Post’s) last offers for collective agreements, dated May 28, 2025…”
(8 This is my guess and is not an empirical or substantiated number. See https://canadasmodernpost.wordpress.com/2013/10/09/canada-post-and-the-universal-service-obligation, where I had calculated $375 million in 2013, but I have factored in inflation since that time.
(9) https://www.cupw.ca/en/government-has-failed-public
(10) https://www.cupw.ca/en/public-post-office-under-attack
(11) https://www.cupw.ca/en/meeting-minister-lightbound-planned-wednesday