In remarks before an Ottawa-based commission, Canada Post’s CEO said that their current trajectory is not sustainable and that the Crown corporation is facing insolvency.
In remarks before an Ottawa-based commission, Canada Post’s CEO said that their current trajectory is not sustainable and that the Crown corporation is facing insolvency.
Just days after Canada Post parted ways with their chief financial officer and two other senior executives, the company’s leaders sounded the alarm on their financial situation in the first public hearing before the federal Industrial Inquiry Commission (IIC).
Doug Ettinger, the company鈥檚 president and CEO, described the current situation as an “edge-of-the-cliff juncture.” The Crown corporation is losing ground to its various competitors, he said, leaving them in financial dire straits in the aftermath of the five-week national postal strike.聽
鈥淲e are literally driving a 1967 Ford in a Formula One race in 2025,鈥 Ettinger said of the company鈥檚 decline in letter and parcel volume. “This is simply 鈥 and I’ll underline this 鈥 not sustainable and we are facing insolvency as a result.”聽
ARTICLE CONTINUES BELOW
The commission, appointed by Federal Labour Minister Steven MacKinnon, will have until May to probe potential ways to reach a new contract agreement between the country’s national postal service and the 55,000-worker union.
Until then, the strike, which began on Nov. 15, will be on pause and workers and management will operate under the terms of the existing contract, which expired more than a year ago.聽
In remarks before the Ottawa-based commission, newly installed CFO Rindala El-Hage said that聽the company was projected to 鈥渞un out of cash鈥 by the end of July 2025 and that its losses are expected to increase, a projection that didn’t include the strike. Last week, the federal government extended a $1.034 billion loan to Canada Post to ”maintain its solvency and ensure it can continue its operations.”
“The status quo is not an option,” El-Hage said.聽
In its response, the Canadian Union of Postal Workers (CUPW) accused Canada Post of union-busting and said that the company is “trying to use its financial struggles as a pretext to implement drastic service cutbacks.”
“In the past, the corporation has made inaccurate financial projections and misrepresented its financial condition to justify service cuts and demand concessions from the union in bargaining,” CUPW president Jan Simpson said before the commission.
Ettinger said that the federal government’s loan serves only as a stopgap.聽
鈥淚t is a temporary loan to ensure we have the money on hand to keep the lights on, continue operating, and pay everyone鈥檚 wages,鈥 Ettinger said. 鈥淭his is clearly not a long-term fix. It is a liability we are expected to pay back. It just buys us time.鈥
ARTICLE CONTINUES BELOW
ARTICLE CONTINUES BELOW
The commission, which is being led by mediator and arbitrator William Kaplan, will have subsequent hearings in February and March before presenting a report to the labour minister by May 15.
Throughout the five-hour hearing, Kaplan pressed both sides on their plans to resolve the labour dispute and secure longer term financial viability for the postal service.聽
Last week, the Star reported that Canada Post “completed a reorganization” of its senior leadership team that resulted in the elimination of five senior executive positions and the departure of their chief financial officer.
In a memo to employees obtained by the Star, Ettinger wrote that the changes would “enhance decision-making by reducing layers and bringing new, strategic perspectives to the table.”
“These decisions were not easy, but they reflect the financial realities we face as a corporation and are effective immediately,” Ettinger wrote.聽
By the weekend, Canada Post had removed the headshots and biographies of the executives they had let go from their website.聽
With files from Josh Rubin and The Canadian Press
Hayden Godfrey is a Toronto-based general assignment reporter
for the Star. Reach him via email: hgodfrey@thestar.ca
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