The victory over the
union reversed years of accommodation and
is a “pillar in the rebuilding of Canada Post and making it sustainable”
11% in the four years prior to his arrival accelerated with the rapid acceptance of wirelessly connected digital devices into people’s everyday routines. “We kind of knew acceleration would happen, but it picked up in earnest” he says. “What was declining at 1% or 2%, picked up 4%, 5%, 6%.” While the Internet is strangling the postal business, it also
holds promise and opportunity for the smaller but fast-growing parcel delivery operations. All those online retail purchases have to be physically delivered to customers and the corpora- tion is determined to play an industry-leading role in that market. But the dramatic decline in the approximately $3-billion letter-delivery foundation of Canada Post’s business model is “almost $200 million in revenue evaporating right before your eyes,” says Chopra. Add in annual inflation and you have a $300-million hole blown in the corporation’s finances. This was the unhappy math that greeted Chopra in his first
year, although it was not immediately apparent, as his first months on the job were consumed by rancorous labour negotia- tions with the Canadian Union of Postal Workers. The show- down with the union resulted in 12 days of rotating strikes, fol- lowed by a June 2011 lockout of its nearly 50,000 unionized employees that ended less than two weeks later with back-to- work legislation introduced by Ottawa. That, however, was just the midpoint of two years of labour
negotiations. It was not until October 2012, and two indepen- dent arbitrators, that the two sides reached a tentative agree- ment. It’s hard to make a case that the union won the day. While it kept pensions intact for current employees, the historically militant union agreed to concessions that included two-tier wages and pensions for new hires. CUPW president Denis Lemelin explained, no doubt wearily, that it was the best that posties could hope for. Citing the large pension plan deficit, annual losses, dropping mail volumes and “very favourable” conditions compared with other postal and courier outfits, he urged his members to grab the deal. Given that an arbitrator would have to make an all-or-nothing pick between the posi- tions of the two sides and would be selected by the Conservative government, Lemelin concluded that “the arbitrator would be bound to impose provisions much worse than the settlement you are being asked to ratify.” The tenacity of Canada Post’s management, plus the tacit
30 | CPA MAGAZINE | MARCH 2015
backing of Ottawa, won out in the end. “It was difficult for us because in 2010 we made more than $300 million in profit,” says Chopra. “So here you are in 2011, gone through a strike and a lockout, and the union is saying, ‘We have had 16 years of non- stop profits, why do we need to give you concessions?’ ” That victory over the union, which reversed the tide of years of accommodation by management, is “a significant pillar in the rebuilding of Canada Post and making it sustainable,” he says. While obtaining labour concessions was critical, that did not
do enough to outrun the revenue decline in letter mail. Chopra turned to the Conference Board of Canada, of which he is a board member, to assess the postal outfit’s future prospects. Its evaluation was grave: it concluded that Canada Post could ring up annual financial losses of $1 billion by 2020. It also deduced, based on a cross-country feedback tour of Canada Post manage- ment, that Canadians would support an end to door-to-door residential letter delivery, higher stamp prices and other measures. The Conference Board report would form the basis of the
turnaround strategy Chopra introduced in 2013: it revolved around price hikes for stamps, more postal franchises, more technology to move mail and parcels faster and a dramatically smaller workforce. (The post office said it expected to shed up to 15,000 employees through attrition over a five-year span, which would allow it to trim its total workforce by 6,000 to 8,000 employees over five years.) But the centrepiece of the five-point plan that Canadians
zeroed in on was the decision to end the cherished tradition of door-to-door mail delivery and substitute it with community mailboxes over a five-year rollout. The company argued logically that only one-third of the country currently gets home delivery, so the change was one of fairness as well as efficiency and cost savings. Needless to say, Canada Post underestimated the furor that its announcement would create and Chopra, no politician, only made matters worse. He earned his 15 minutes (and much more) of infamy when
he told federal politicians that senior citizens would embrace the idea of community mailboxes. “The seniors are telling me, ‘I want to be healthy. I want to be active in my life,’” Chopra told a government committee. “The citizens and the seniors I spoke to, they want to be active. They want to be living fuller lives.” The
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