Canada Post ruling changes power dynamics in public sector labour disputes
The Ontario Court of Appeal has ruled that back-to-work legislation violates workers' constitutional right to strike but can be justified when paired with fair, neutral arbitration. The Feb. 6, 2026, decision in Canadian Union of Postal Workers v. Canada (Attorney General), written by Justices Pepall, Lauwers and Dawe, establishes a new constitutional framework for government intervention in labour disputes following a five-week Canada Post strike in 2018.
The court found that while the Postal Services Resumption and Continuation Act limited postal workers' freedom of association under the Charter, the government demonstrated the legislation was justified because it included an impartial arbitration process designed to replicate what the union would have achieved through free collective bargaining.
When government steps in
On Oct. 22, 2018, Canadian Union of Postal Workers began rotating strikes across several cities after a year of unsuccessful bargaining. The strikes continued for five weeks, affecting mail and parcel delivery nationwide. On Nov. 8, 2018, Prime Minister Justin Trudeau told reporters that "all options [would] be on the table" to resolve the labour dispute if the parties did not reach a resolution shortly.
Two weeks later, Parliament passed the Postal Services Resumption and Continuation Act. The legislation required Canada Post to resume regular postal services and employees to return to work immediately. It extended the previous collective agreements until new ones were reached and prohibited strikes during that period.
The Act also required the Minister of Labour to refer all outstanding bargaining issues to a mediator-arbitrator and imposed fines for non-compliance. Minister Patty Hajdu appointed Elizabeth MacPherson as mediator-arbitrator in December 2018, acceptable to both parties.
Constitutional rights violated—but justified
CUPW challenged the legislation, arguing it violated members' freedom of association under section 2(d) of the Charter and freedom of expression under section 2(b). The union sought declarations that the Act was unconstitutional and asked the court to order remedies including potential damages.
The Court of Appeal agreed that back-to-work legislation ending a lawfully called strike limits workers' constitutional right to freedom of association. The court concluded that "back-to-work legislation that ends a strike that was properly called under the legislation, as was CUPW's strike, limits the rights of affected union members under s. 2(d) of the Charter and must be demonstrably justified by the government under s. 1."
However, the court found Canada successfully demonstrated the limit was justified under section 1 of the Charter. The application judge had found the rotating strikes caused "serious social and economic dislocations," and the legislation had a pressing and substantial objective.
The arbitration standard
The critical factor separating constitutional from unconstitutional back-to-work legislation was the quality of the arbitration process. The arbitrator applied the replication principle in her decision, "crafting an award that attempted to mirror what CUPW would have likely achieved in free collective bargaining."
The court emphasized that even CUPW's own expert validated the legislation's fairness. "The expert on industrial relations put forward by CUPW, Professor Robert Hebdon of McGill University, confirmed in his testimony that the [Act] is a fair and neutral piece of legislation. Indeed, he went so far as to opine that the government had effectively cured all the deficiencies of the previous legislation [from the CUPW 2016 case]."
The application judge had noted that "[t]he parties were free to fashion the issues that were important to them" during the 42-day arbitration involving oral testimony. The resulting collective agreement was ratified by CUPW membership and eventually led to negotiated extensions, which the parties did not seek to overturn. The court concluded that fair arbitral process provided an appropriate substitute for the right to strike.
See Canadian Union of Postal Workers v. Canada (Attorney General), 2026 ONCA 75
