The Treasury Board’s wage offer is viewed as an insult to public service workers, prompting an impasse in negotiations. After four months of delays, the Treasury Board proposed a wage increase of 2.0% in 2025, followed by 0.5% in 2026, 0.5% in 2027, and 0.5% in 2028. This proposal falls significantly short of the Public Service Alliance of Canada (PSAC) request for economic increases of 4.75% per year.
This situation is particularly troubling given that the cost of living has outpaced wage growth in recent years, affecting federal public service workers who provide essential services. In fact, recent private-sector wage settlements average 4.4% in 2024, 3.9% in 2025, and 4.2% in 2026. Thus, the employer’s offer amounts to less than 1% per year, which many see as a de facto pay cut.
The PSAC has expressed strong discontent with the Treasury Board’s proposal, stating that it is disrespectful to the hard work and dedication of public service workers. “Public service workers deserve better,” said a union representative during a recent demonstration where members showed solidarity by wearing black.
That context matters because it highlights the urgency of these negotiations. An impasse was declared by the TC bargaining team due to the employer’s wage proposal, and similar sentiments echoed from the SV bargaining team who received the same terms after months without a response. The employer has also stalled discussions on critical issues such as job security and remote work arrangements.
In response to this deadlock, PSAC plans to request conciliation through the Federal Public Sector Labour Relations and Employment Board. Observers note that this step indicates just how serious the situation has become—both sides must find common ground or risk prolonged uncertainty.
The next round of talks is scheduled for June, but officials have not confirmed whether any significant changes will occur by then. As both parties prepare for these discussions, the stakes remain high for thousands of public service workers whose livelihoods depend on these negotiations.
