Mail will continue to flow across the country as signs of progress arise between Canada Post and the Canadian Union of Postal Workers.
Canada Post backtracked on its threat to lock out its 50,000 employees only hours before the midnight deadline for Monday.
The Crown Corporation issued a brief statement Sunday night saying it withdrew its lockout notice to “allow both parties to focus on their efforts on serious negotiations.”
Canada Post also made it clear that it hopes the union will not issue a strike notice of their own.
“Assurance from both parties that the postal system will remain open for business while we negotiate will provide the certainty that Canadians and our employees are looking for,” the postal office said.
Canada Post’s news release follows a statement from federal Labour Minister MaryAnn Mihychuck who urged the two sides to continue discussions beyond the lockout deadline.
“I am pleased that there has been movement at the bargaining table and that progress is being made,” the minister said. “I remain hopeful that an agreement can be reached by the parties.”
Canada Post initially threatened to lock out employees last Friday, before extending the deadline to Monday at 12:01 a.m.
The two sides have been negotiating for the last seven months, including 60 days of conciliation talks and more than 30 days with federal mediators.
Canada Post has been fighting for binding arbitration to help settle the outstanding contract issues, but the union has refused the proposal.
The main stumbling blocks in the dispute include employee pension plans and wage parity.
The union has demanded changes in how rural and suburban mail carriers are paid.
They are asking to be paid the same hourly wage as urban carriers, rather than by how many packages they deliver.
Meantime, Canada Post says it wants to change its pension plan for new hires by introducing a defined contribution plan instead of a defined benefit plan.
The new plan helps reduce costs to the company that is currently facing a $6 billion pension solvency deficit.
Some postal workers have been without a contract since late 2015, while others have been without one since January.
With files from Rana Aladdin