Canada Post Minister Says He’s Ready to Allow Big Job Cuts

What to do with Canada Post?

It’s a question that’s out of the government’s hands until next month. On Sept. 25, Ottawa gave Canada Post CEO Doug Ettinger 45 days to come up with a plan to bring the Crown corporation back from the brink.

Over the past week, a committee of MPs that ensures government functions effectively has been trying to find ways forward for the corporation.

The Standing Committee on Government Operations and Estimates heard testimony from Joël Lightbound, the minister for government transformation, public works and procurement, who is responsible for Canada Post.

Lightbound told the committee he plans to let Canada Post make changes recommended in commissioner William Kaplan’s report, including ending home delivery, closing rural post offices, scaling up parcel delivery and making employment more flexible.

Saving Canada Post will require at least 10,000 layoffs, experts say.

But Lightbound said he plans to stay the course and make changes needed.

The postal service laid off dozens of managers this week.

“Part of that transformation will happen through attrition. I’m convinced of that,” Lightbound said, speaking through a translator. “But the transformation has to begin.”

But on Tuesday morning, Canadian Union of Postal Workers president Jan Simpson told the committee that government intervention has prolonged its drawn-out labour dispute, which has led to ongoing rotating strikes.

“The government has intervened a lot this round of bargaining, and it has hindered our bargaining,” Simpson said. “It has delayed bargaining and put instability on the Canadian public.”

She said letting the union get fair collective agreements for workers would mean stability for the corporation, and let the business resume bringing in revenue.

A radical restructuring

Earlier this year, the federal government gave Canada Post a $1-billion bailout. That’s the type of payment Lightbound said he was not willing to continue.

“It’s important for us, if we are to be responsible, to stop the hemorrhaging, stop the bleeding,” Lightbound said. “It cannot be stuck in a business model that was designed for the ’90s. It needs to adapt to today’s reality.”

The committee consulted with business professors Ian Lee and Marvin Ryder, from Carleton University and McMaster University, respectively, on possible ways forward for Canada Post.

Ryder said the changes Lightbound has already allowed would help Canada Post — but the corporation will still need to find a way to grow its business if it plans to break even.

Ryder predicted the changes needed would mean 10,000 employees would either be encouraged to retire or laid off.

“No union is going to want to agree to that,” Ryder said. “So I don’t quite know how you’re going to find that labour harmony that is so necessary.”

Lee offered an alternative path forward — stop delivering mail five days a week, franchise all Canada Post-owned post offices to be independently run and allow Canada Post to re-assign mail carriers work while they’re on the job.

Canada Post would need to “radically restructure” and become a much smaller company, Lee said — a change he estimated would mean 15,000 to 20,000 layoffs.

‘Let Canadians decide’

On Tuesday, CUPW’s Simpson told the committee that instead of following Kaplan’s recommendations, Canada Post should invest in its parcel business and launch financial products to raise revenues.

“Kaplan ignored the voice of workers, communities, municipalities, charities and small businesses,” Simpson said.

She said the union has consulted the Canadian public, and recommends increasing the cost of mailing letters and packages and expanding door-to-door delivery — which Simpson said is the post’s competitive advantage.

The union is calling for the federal government to consult with the public before letting Canada Post make sweeping structural changes.

“Let Canadians decide what they want and need from their public post office, and let’s reverse the cuts and invest in the future of our public postal service,” she said.

“Together, we can build a stronger, more sustainable Canada Post, one that continues to serve every Canadian.”

The corporation has not yet presented its plans for service change. Canada Post’s Ettinger still has until early November to bring Ottawa his recommendations on a path forward.