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 season.

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 increase, and want the ability to work weekends with overtime pay instead of having Canada Post rely on outside contractors.

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

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

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

The Canadian Union of Postal Workers (CUPW) and Canada Post entered a new 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 increase over the next four years - higher than the 11.5% increase proposed by employer Canada Post. They are also negotiating issues around benefits, sick leave, job conditions and security.

“Our demands are reasonable: fair wages, safe working conditions, the right to retire with dignity and the expansion of services at the public 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 time 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 go back to work through legislation.

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

The latest strike comes as the Crown corporation deals with big financial losses of C$3bn since 2016, primarily due to the fact 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 report, the operator said its financial situation is “unsustainable", and had projected that it will run out of cash unless it borrows C$1bn and refinances its existing debt.

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