More than 50,000 postal workers across Canada entered the fifth day of a labour strike over pay and working conditions, disrupting mail delivery ahead of the busy holiday period.

The union representing employees at Canada Post – the country’s main postal operator – has said that negotiations remain “far apart” and are ongoing.

Workers are asking for a wage boost, and desire the ability to work weekends with overtime pay instead of having Canada Post depend on outside contractors.

The operator, which has faced significant budgetary losses in recent years, has warned that the labour disruption “would affect millions of Canadians and businesses who depend on the postal service”.

The work stoppage, which began on Friday, has halted mail and parcel services across the country, including the delivery of financial institution cards and statements, general mail, recent passports and online shopping orders – all at a period when people across Canada are preparing and buying gifts for the holidays.

The Canadian government has since appointed a special mediator to assist both sides reach an agreement.

The Canadian Union of Postal Workers (CUPW) and Canada Post entered a recent round of mediated negotiations on Monday, but both sides have said they remain far away from reaching a deal.

The union wants a 24% pay boost over the next four years – higher than the 11.5% boost proposed by employer Canada Post. They are also negotiating issues around benefits, ill leave, job conditions and safety.

“Our demands are reasonable: fair wages, secure working conditions, the correct to retire with dignity and the expansion of services at the community post office,” the union has said.

Canada Post has warned that its services will be disrupted even if an agreement with its workers is reached, writing in a statement last week that “a national strike of any length will impact service to Canadians well after the strike activity ends”.

It added that it has already felt an impact, with customers switching to private competitors or stopping use of its services altogether as the strike is ongoing.

The last period Canadian postal workers walked off the job was in October 2018. Back then, rotating strikes lasted more than a month before the federal government mandated that employees leave back to work through legislation.

That job action expense Canada Post around C$135m ($96.7m; £76.27m).

The latest strike comes as the Crown corporation deals with large budgetary losses of C$3bn since 2016, primarily due to the truth that people are sending fewer letters than before.

Rivals like Amazon, FedEx and UPS have also taken a chunk of Canada Post’s business.

In its 2023 annual update, the operator said its budgetary circumstance is “unsustainable”, and had projected that it will run out of money unless it borrows C$1bn and refinances its existing obligation.

“Canada Post is at a critical juncture in its history,” the update stated, adding that with mounting budgetary pressures, the publicly-owned mail operator is “under significant threat”.