Canada Post reports Q3 loss of $71 million, blames pay equity ruling

OTTAWA — Canada Post says it recorded a loss of $71 million in its latest quarter, which it is directly blaming on costs related to a pay equity dispute with its largest union.

The country’s postal service says the net loss compares with a loss of $44 million in the third quarter a year ago.

In September, an arbitrator ordered Canada Post to give rural and suburban mail carriers pay increases of up to 25 per cent to settle a long-fought pay equity dispute.

Not including added benefits that were part of the ruling, the Canadian Union of Postal Workers says the pay increase amounted to as much as $13,000 annually, retroactive to the beginning of 2016.

Canada Post says the costs of the wage adjustments, increases in pension pay and other benefits will amount to $550 million by the end of the year, with $130 million already recorded by the end of 2017. It says it will continue to cost the Crown corporation $140 million going forward annually.

When taking into account its other operations like Purolator, Canada Post says it had a net loss of $36 million in the 13-week period ended Sept. 29, compared with a loss of $13 million for the same period a year earlier.

It says parcel revenue grew by 21 per cent in the third quarter to $106 million, as volumes climbed by 23 per cent or 14 million pieces, when compared with the same quarter in 2017. Canada Post attributed the increase to the continued growth in e-commerce.

Meanwhile, it says transaction mail, which is categorized as letters, bills and statements, fell by 4.6 per cent, or 35 million pieces, in the third quarter.

Revenue for transaction mail dropped 3.6 per cent, or $24 million, compared with a year ago. Canada Post blames the decrease to consumers choosing ”digital alternatives” and acknowledged that declining mail volumes will remain a “significant challenge” for the corporation.

The Crown agency says the impact of the pay equity and ongoing rotating strikes are “major factors” in it ending this year with a loss.

On Monday, senators approved the Liberal government’s decision to bring in back-to-work legislation by giving royal assent of Bill C-89 by a vote of 53-25, with four abstentions.

CUPW says it is exploring all options to fight it.

Its members have been on rotating strikes since Oct. 22 after nearly a year of labour negotiations.

The walkouts have led to delays in mail and parcel deliveries from the Crown corporation’s sorting facilities in Vancouver, Toronto and Montreal, leading to concerns ahead of the busy holiday season.

The union wants better pay and job security, guaranteed hours for its 8,000 rural and suburban carriers, and equality for those workers with the corporation’s 42,000 urban employees.

CUPW also wants Canada Post to adopt rules that it says would cut down on workplace injuries — an issue the union has said is now at a “crisis” level.

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