OTTAWA - The union representing urban-based workers at Canada Post was to present a new contract proposal Sunday that it hoped would address the remaining outstanding issues as the two sides tried to head off threatened job action.

"We believe this offer should be the basis of a settlement," the Canadian Union of Postal Workers said in an email updating the status of the talks.

The two sides expected to negotiate throughout the weekend to try to hammer out a deal. The union had threatened strike action as early as Tuesday, but CUPW has not provided 72 hour strike notice so May 26 would be the earliest the workers could take job action, said Canada Post spokesman Jon Hamilton in an email.

An earlier agreement covering some 50,000 employees expired Jan. 31, and talks on a new deal began last fall.

"Canada Post remains committed to reaching a negotiated settlement that will protect Canada's postal service, minimize future postal rate increases and improve the wages of our employees," said Hamilton.

Major issues include wages and benefits, staffing levels and working conditions.

On Friday, federal Labour Minister Lisa Raitt urged both sides to reach a deal to avert a potential disruption of the country's mail service.

Meanwhile, Canada Post has reached an agreement with the union to bring in volunteer postal workers to deliver cheques to pensioners and those on social assistance should a labour disruption occur.