OTTAWA (Reuters) – Canada Post locked out all its employees on Wednesday, saying more than a week of rotating strikes by unionized letter carriers and other postal workers had cost it too much money.
The move immediately caught the attention of Labour Minister Lisa Raitt, who is preparing legislation to end a strike at Air Canada and is now consulting cabinet colleagues on whether to do the same with Canada Post.
"We have all kinds of options, and everybody knows what those options are according to the Canada Labour Code," Raitt told reporters.
Canada Post and the workers are engaged in a contract dispute complicated by questions over how the postal system can survive in a era when letter writers use email and bills are delivered and paid via the Internet.
Key discussion points are pensions and wages as well as health and safety issues.
Raitt defended the decision not to introduce Canada Post legislation so far, saying that the union's rotating 24-hour strikes had not shut down the postal system, but the lockout had now done so.
"We've had...rolling strikes, and we really haven't heard a lot of public outcry. It's different from 1997, when we saw a lot of people concerned about a general mail strike. Now we have email, we have package services," she said.
Contrasting the current situation with the initial rolling strike, she said: "This is different. This is now a lockout... We're going to go back and take a look at the parameters."
Canadian Union of Postal Workers (CUPW) President Denis Lemelin told an Ottawa news conference that back-to-work legislation would be unfair.
"Free bargaining is important. It's the only way that the parties can achieve something."
CUPW launched a series of 24-hour strikes 12 days ago, rotating among different communities across the country. Canada Post says the job action has already cost it C$100 million ($103 million).
"The accelerating decline in volumes and revenue combined with the inability to deliver mail on a timely and safe basis has left the company with no choice but to make this decision," the federal corporation said in a statement.
The leader of about 15 postal workers picketing outside a Toronto post office said the union had been trying to be fair by not launching a nation-wide strike, but said Canada Post was trying to prompt the threat of legislation.
"They want us to be legislated back so that we don't get a fair deal on our contract. That's why they're doing what they're doing -- they're blackballing themselves," said Pamela Lepine, union captain at the post office.
Propped against the building were signs reading: "Tyrant bosses locked us out", and "Locked out by mindless greedy tyrants". Streetcar drivers honked as they passed by.
Canada Post, which is owned by the federal government but operates independently as a for-profit company, had already cut mail delivery in urban areas to three days a week in response the labor action.
Canada Post has offered raises to existing employees, but has said its survival depends on it being able to impose a lower wage scale on workers hired in the future so that it can compete better with other delivery companies, which have lower cost structures.
The union says the company is profitable, but refuses to listen to CUPW's proposals to deal with increasing competition by providing nontraditional services such as banking at post offices.
Canada Post has also said it needs changes in its pension plan because it is currently running a C$3.2 billion deficit, but the union says that figure is exaggerated.
Queen's University labor relations expert George Smith said the lockout was expected.
"The only surprise with this move by management is that it took this long," he said. "The union declared a strike at the beginning of June and slowly escalated it over the days. Canada Post management tolerated it for a while in hopes a settlement could be reached without a full-scale strike."
($1=$0.97 Canadian)
(Additional reporting by Allison Martell in Toronto and Allan Dowd in Vancouver; editing by Rob Wilson and Peter Galloway)
