Sweeping changes announced today to the way Canada Post operates could lead to as many as 8,000 fewer employees for the mail service.
In a major announcement Wednesday, the Crown corporation said it will phase out home mail delivery service to urban customers. Almost 10 million Canadian households already don't have mail delivered right to their doors, and the latest news will affect the other five million households in the country.
By switching to a system where mail receivers will go to community mailboxes (CMBs) to retrieve their letters, the mail service hopes to save hundreds of millions of dollars per year.
Part of that will come in labour savings, and the changes outlined Wednesday were very much made with an eye toward embracing a future with a major reduction in letter carriers.
The postal service says the average age of its employees is 48, and it expects as many as 15,000 Canada Post workers plan to voluntarily leave the company in the next five years.
Canada Post's largest union, the Canadian Union of Postal Workers (CUPW), came out strongly opposed to the plans, calling them "the end of an era for Canada Post."
The union pitched the idea of postal banks — where local post offices offer rudimentary banking services for customers — as a better option, noting that several nations have tried that approach with some success.
At the end of the 2012 fiscal year, Canada Post employed 68,000 and the company said it expects to continue to reduce its unionized workforce by at least 10 per cent over the next decade, so a reduction of between 6,000 and 8,000 positions is right within that range.
In addition to service changes, the Crown corporation also announced a major overhaul to its pension plan.
Canada Post has about $17 billion in assets in its pension plan, but also has a $6.5-billion solvency deficit.
That sort of deficit would normally be solved by making special payments to top up the plan, something Canada Post is not in a good financial situation to do at the moment. The core mail operations have been losing hundreds of millions of dollars per quarter for several quarters in a row.
