This editorial was first published in 2011, when Canada Post and the Canadian Union of Postal Workers last faced a labour dispute that resulted in a work stoppage. For our coverage of the current dispute, please click here.
Rain or snow or sleet or hail can’t disrupt the mail. But what rhymes with seven weeks of annual paid vacation, out-of-whack pay scales or infinitely bankable sick days?
While the rotating strike by workers at Canada Post has proven to be a hardship for many Canadian businesses, it is also shining necessary light on the massive disparity between postal employees and workers in the private sector. Outside of bureaucrats in France, it is hard to imagine a more coddled, out-of-touch and overcompensated group than postal workers.
Canada Post’s efforts to bring labour costs in line with common sense, modern technology and market rates should be supported regardless of the strike’s immediate implications. A successful conclusion to this strike might even spark a broader rationalization across all Crown corporations and government operations.
By any objective measure, a job at the post office is well-rewarded, despite the weather. Research by the Canadian Federation of Independent Business in 2008 found postal workers enjoyed a 17 per cent wage premium over comparable private sector jobs. The current offer from Canada Post would raise wages by 7.4 per cent, on a cumulative basis, over the next four years. Union officials are demanding 11.55 per cent—a massive increase for workers who are already demonstrably overcompensated.
As with most sinecures, however, the real advantage to working at Canada Post is in the benefits. Postal workers currently accumulate sick days at the rate of 15 per year, with no maximum. The extent of this bottomless bank of sick days is illustrated by a recent Canadian Union of Postal Workers (CUPW) bulletin that offered up the apocryphal example of “Narinda,” who has “402 days of sick leave credit.” Canada Post is sensibly proposing to buy out this improbable inventory; Narinda would receive $3,000 cash for her hoard of sick days.
Then there is the matter of paid vacation. Current full-time Canada Post employees are eligible for up to seven weeks of holiday, a prospect far beyond imagination for most in the workaday world. And the pension plan has an unfunded liability of $3.2 billion.
The business of mail delivery has changed dramatically since the last postal strike in 1997. The advent of electronic bill payment, email and the rest of the digital revolution has led to a 17 per cent decline in letter mail volume since 2006.
Canada Post’s sensible strategy is to establish a more reasonable pay and benefits system for workers in this declining industry—but only for new hires. Other than replacing the absurd sick-day bank (which Canada Post has offered to refer to binding arbitration), full-time postal workers would keep all their existing wages and benefits, whether appropriate or not. New employees would have a lower starting wage, receive six weeks of vacation instead of seven, and subscribe to a different pension plan.
Canada Post’s offer is reminiscent of the deal given North American dockworkers when intermodal shipping containers revolutionized the stevedore business in the 1960s. Existing workers had their jobs, wages and benefits protected for the extent of their careers, but anyone hired after the deal was signed was expected to accept reality. It seemed more than fair back then. The same logic should apply today.
While disputing the decline in mail volume and continuing to make unrealistic demands on wages and benefits, the postal union is nonetheless seeking new ways to hold the Canadian economy hostage: CUPW has called on Canada Post to expand into banking and finance. The prospect of rotating bank strikes is no doubt pleasing to union organizers. Not so for the rest of the country.
Of course the current postal dispute has significance far beyond the future of letter mail or the ambitions of Canada Post and its union. The gap between private and public sector compensation has now reached crisis proportions, and must be addressed for the sake of equity, affordability and coherent labour peace.
One example of how large and untenable this gap has become can be found in Statistics Canada’s recent observation that public sector employees now constitute a majority of all pension plan participants, despite being outnumbered more than three to one in the workforce. This suggests two types of retirement in the future: one of carefree luxury for public sector employees, and one of reduced expectations for everyone else. A similar dichotomy is at work with Ontario’s practice of paying a bonus to every corrections staffer who takes fewer than 23 sick days per year.
A postal strike seems as good a time as any to start imposing a new sense of reality on the public sector.