Canada Post advised to phase out part of door-to-door delivery to survive
Recommended changes to Canada Post could mean the end of part of its daily door-to-door mail delivery.
The Industrial Inquiry Commission (IIC) report on the labour dispute between the Crown corporation and the Canadian Union of Postal Workers (CUPW) was made public on Friday, days before Canada Post employees could go back on strike.
It comes after IIC commissioner William Kaplan held hearings in February to review Canada Post’s financial situation and the union’s negotiated commitments to job security and full-time employment.
Icatnews/Shutterstock
Kaplan concluded that the postal service is “facing an existential crisis.”
“It is effectively insolvent, or bankrupt. Without thoughtful, measured, staged, but immediate changes, its fiscal situation will continue to deteriorate,” he wrote in the report.
The commissioner says the corporation’s three lines of business — letter mail, direct-marketing mail, and parcel mail — are in decline due to a shift in electronic and digital mail and marketing and “fierce competition” from the private sector in parcel mail.
“Until recently, Canada Post was able to operate in a financially sustainable manner through cross-subsidization: Low-cost urban and suburban mail delivery subsidized high-cost delivery to rural, remote, and Indigenous communities,” explained Kaplan.
“This model no longer works because the traditional core business — mail delivery — has fundamentally changed: fewer letters must now be delivered to more addresses.”
Canada Post report recommendations
Lester Balajadia/Shutterstock
Kaplan presented some recommendations for the Crown corporation and its negotiations with the CUPW.
He suggested the two parties amend their collective agreements to allow for the flexible use of part-time employees during the week and on weekends.
“These employees should be paid the same rates and be subject to the same terms and conditions as regular employees, including access to pro rata benefits, or payments in lieu, and pension,” reads the report. “Priority for these positions should be given to existing employees.”
In addition, Kaplan advised amending the Postal Charter so that it doesn’t “continue to require impossible-to-meet delivery standards.” This would include phasing out daily door-to-door letter mail delivery for individual addresses and implementing community mailboxes wherever practical. He says daily delivery to businesses should be maintained.
The commissioner also advised the Canadian government to end the moratoriums on rural post office closures and discussions surrounding community mailboxes.
Kaplan says that if implemented, these recommendations could save Canada Post from bankruptcy.
“These changes may return Canada Post to some degree of financial sustainability so it can continue the Universal Service Obligation – for both letter mail and parcels – but in a
manner that reflects the 2025 realities of disappearing letter mail and a highly competitive parcel delivery environment,” he wrote in the IIC report.
“The world has changed, and both Canada Post and CUPW must evolve and adapt. Merely tinkering with the status quo is not an option.”
Kaplan was appointed to run the commission in December after over 55,000 employees represented by CUPW hit the picket lines in mid-November. The 32-day Canada Post strike resulted in major delivery delays during the busy Christmas season.
The federal government ordered Canada Post employees back to work in December after the Minister of Labour announced his decision to invoke his authority under the Canada Labour Code.
Canada Post workers aren’t the only ones expected to walk off the job soon. Unifor DHL Express Canada members could strike next month if a deal isn’t reached with their employer.