Dive Brief:
- Canada Post believes a "substantial" gap remains in contract negotiations between it and the Canadian Union of Postal Workers, the government-owned carrier announced Wednesday.
- The two parties returned to the bargaining table after employees represented by CUPW voted against contract proposals from Canada Post. Following a review of the union's counteroffers, the carrier is urging CUPW "to revisit its offers to align with the realities confronting the company."
- "Unfortunately, CUPW has either maintained or hardened its position on many items and added new demands, and the gap between the parties remains substantial," Canada Post said. "Several proposed items would increase the Corporation’s operational costs."
Dive Insight:
Wage increases and weekend delivery operations remain key sticking points in protracted contract negotiations between Canada Post and CUPW. The uncertainty, along with a union-imposed overtime ban that has been in place since May 23, is spurring shippers to use alternative parcel delivery methods.
CUPW aims for a 19% pay hike over four years, higher than the 13.59% bump Canada Post pushed for in its "final offers" that employees ultimately voted down. As for weekend delivery, the carrier has wanted to establish new part-time employee groups to handle that volume. The union is proposing limitations on how many part-time workers can be involved in the process.
"While the union’s offers included some part-time employee component to address weekend delivery, CUPW’s proposed approach remains unaffordable, problematic and complex to manage," Canada Post said.
CUPW National President Jan Simpson said last week that the union's proposals "deliver the improvements postal workers need in their collective agreements."
As differences persist between the two parties, Canada Post is struggling to retain package shippers. Parcel volume plummeted 36.5% year over year in the second quarter, while parcel revenue saw a similar decline of 36.7% YoY.
Canada Post said shippers have deflected volume to "other carriers offering stability and better competitive offerings," per its Q2 report. FedEx, UPS and Purolator are among the options that businesses have leveraged to ensure the labor turmoil doesn't cascade into delivery delays for their customers.
Whether Canada Post can attract diverted packages back into its network once new labor agreements are reached remains to be seen.
"These volumes are difficult to win back as these alternative delivery providers have more flexibility and competitive offerings," Canada Post said in the Q2 report.
