OTTAWA - Workers at Canada Post appear to be headed for the picket line Thursday night after the union representing urban workers gave the Crown corporation its final offer on Monday.

"We have some days in front of us but at some point the union will have to go forward," Denis Lemelin, national president of the Canadian Union of Postal Workers, said Monday after a meeting with Canada Post.

"It is important that Canada Post let go some of its demands and rollbacks that they put on the table."

Canada Post called the union "out of touch" with the challenges the company is dealing with, such as decreasing mail volumes.

"The latest counter offer from the union does nothing to address the significant challenges facing the company," Canada Post said in a statement Monday afternoon.

The Crown corporation said mail and parcels will not be delivered in the event of a strike, however Canada Post and the union have an agreement to bring in volunteer workers to deliver cheques to pensioners and those on social assistance.

The union served notice Monday that puts it in a legal position to strike on Thursday at 11:59 p.m. EDT.

Lemelin said the union and Canada Post have a history of reaching a deal at the last minute, but said Canadians thinking about mailing a bill payment or other urgent letter this week will have to consider that decision carefully.

"It is why we have informed the population around the issue and people have the choice to use or not to use the mail," he said.

Federal Labour Minister Lisa Raitt was concerned that a strike was being considered and urged the two sides to reach a negotiated settlement.

"Any work stoppage would impact Canada's economic well-being," Raitt said in a statement. "We are currently going through an economic recovery, which remains fragile."

The last time the union went on strike was the fall of 1997.

Workers were off the job for two weeks before being forced back to work by federal legislation ahead of the busy holiday season.

Lemelin noted that in 2003 the union reached a deal at the last minute after postponing its right to strike a couple of times.

"As a negotiator you have to always be positive and optimistic that you will have a collective agreement," he said.

The two sides have been in talks for more than seven months and have not been able to hammer out an agreement.

The union's final offer Monday included several amendments and clarifications to its positions -- including a drop in its wage increase demands. CUPW also agreed to Canada Post's request for a four-year collective agreement.

Lemelin said a key sticking point for the union is sick leave for employees.

"They want to replace what we have," he said. "They want to have what they call short-term disability plans."

Canada Post said lettermail volume has dropped more than 17 per cent since 2006.

The union has suggested Canada Post explore the possibility of offering banking, financial and other services to keep the company relevant as Canadians mail fewer letters.

The union represents 48,000 urban postal workers and negotiations to reach a new collective agreement began last fall. It also represents another 7,000 rural and suburban mail carriers in another bargaining unit.