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Rural and suburban postal workers across Canada celebrated Thursday after an arbitrator ordered Canada Post Corp. to pay them more – much more – as part of a long-awaited pay-equity decision.

For a majority of the Crown agency’s mostly-female rural and suburban carriers, known as RSMCs, the ruling translates into a 25-per-cent pay hike, plus some increased benefits, Canada Post spokesman Jon Hamilton said.

Not including benefits, the pay increase amounts to as much as $13,000 annually, retroactive to the beginning of 2016, said Canadian Union of Postal Workers representative Cathy Kennedy.

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“We’re very happy with [the ruling],” said Ms. Kennedy, who was one of three members of the union’s pay-equity committee.

Arbitrator Maureen Flynn issued the ruling to Canada Post and CUPW after the two sides failed to reach an agreement through mediated talks by an Aug. 30 deadline.

The union argued Canada Post’s 8,000 rural carriers – most of whom are women – were being paid substantially less than their mostly male urban co-workers. About 60 per cent of RSMCs are women.

The chair of Canada Post’s board of directors and interim president and chief executive, Jessica McDonald, pledged to move quickly to implement the pay changes and called Ms. Flynn’s ruling “thoughtful and detailed.”

“This is an incredibly important ruling for our rural and suburban carriers,” Ms. McDonald said in a statement. “Pay equity is a basic human right and therefore pay disparity on the basis of gender is wholly unacceptable for Canada Post.”

In a preliminary 176-page decision issued in May, Ms. Flynn largely sided with the union over how Canada Post should calculate compensation rates for its rural workers, calling the corporation’s methodology “not reasonably accurate.”

Thursday’s ruling came as CUPW and the post office continued to negotiate new contracts under a Sept. 25 deadline for a strike or lockout, with the aid of a third party.

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Canada Post indicated late last month – when it posted a second-quarter loss before taxes of $242-million – that settling the pay-equity dispute could cost the corporation upwards of a quarter of a billion dollars.

The second-quarter loss, meanwhile, was a dramatic drop from the $27-million profit the agency recorded during the same period in 2017. The corporation said the losses came despite a nearly 20-per-cent increase in second-quarter parcel revenues over the same three-month segment in the previous year.

Canada Post said on Thursday that a full accounting of the cost of the pay-equity decision would be included in its third-quarter results.

The dispute was complicated by the fact that rural and suburban postal carriers have been paid under different remuneration structures, leaving exact hourly pay rates open to some interpretation.

The lowest-paid RSMCs earn a “derived hourly rate” of $19.73 an hour. Under Ms. Flynn’s ruling, that rate is increased to $25.95, retroactive to Jan. 1, 2016, Ms. Kennedy said. But that doesn’t include general wage increases awarded since 2016, she said.

Higher-paid rural and suburban carriers would see their paycheques match the higher hourly rate.

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CUPW said it was disappointed in a portion of Ms. Flynn’s ruling that awarded the back-dating of post-retirement benefit increases to 2016. The union had asked that the benefits be calculated as far back as 2004.

The federal government announced in its 2018 budget that it would introduce pay-equity legislation to ensure all federally regulated workers who perform work of equal value receive equal pay.

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