Postal workers are walking the picket line in Red Deer, Alta. this weekend, after their union said contract negotiations between its representatives, Canada Post and the federal labour minister have stalled.

Approximately 155 workers walked off the job late Friday night, for strike action slated to last until Sunday night.

"The purpose of this 48-hour strike action, is to illustrate the importance of CUPW's proposals in this round of bargaining, including our demands for proper staffing, greater rotation of duties, and an end to forced overtime," the union said in a bulletin announcing the latest walkout.

But some Canadian businesses say they are feeling the effects of the ongoing postal strike, which has been jumping from city to city across the country.

One Toronto-based bill printing firm recently had to temporarily lay off about 40 per cent of its workforce because it can't get shipments out.

Federal Labour Minister Lisa Raitt had called for an end to the strike and service cutbacks on Friday, but the union said it would only do so if management re-instated the current collective agreement.

"This behaviour on the part of Canada Post corporation is totally unacceptable," the union's national president and chief negotiator Denis Lemelin said in a statement Friday night.

"We are showing that we are willing to suspend our strike in good faith and with goodwill, as the minister requested. Once again, Canada Post is rejecting any of our efforts to resolve the issues."

In its own statement, Canada Post said that reverting to the old collective bargaining agreement would be "completely unacceptable."

"By maintaining the uncertainty for customers and hurting our revenues, the union's proposal is tantamount to asking for full pay to remain on strike," the Crown corporation said.

Mail service in most urban areas will continue to be reduced to three days a week. Canada Post said mail volumes have dropped due to the strikes and, therefore, it must adjust service levels appropriately.

The union said arbitrations are planned to continue over the weekend.

Negotiations between the union and management were due to continue Friday night into the weekend, the union said.

While Canada Post argues that it must cut costs in light of the combination of lagging demand for its services and looming pension obligations, the union says the Crown corporation is turning a profit and can afford to do better.

When postal workers last hit the picket lines in 1997, lawmakers ordered them back to work after just two weeks. Earlier this week, Raitt said she has no plans to legislate an end to the job action.

"A deal they reach themselves is the best deal," she told CTV's Power Play.

So far, the rotating job action has communities nationwide including a spate of small to mid-sized communities from the Yukon to Prince Edward Island on Thursday. Other cities directly affected by the walkouts include Montreal, Victoria, Calgary, Edmonton, Kitchener and Quebec City.

Canadians who have yet to notice any effect on their mail service can expect that to change next week, however, as Canada Post says a 50 per cent drop in mail volumes since the strikes began mean it will begin adjusting staffing levels and schedules on Monday.

Canadians who usually enjoy daily home mail and package delivery will see their service cut back to just three days a week. While those who collect their mail from rural or community mailboxes will not see any changes, as they are serviced by postal workers covered by a separate collective agreement.

Mail collection will continue, however, and post office outlets will maintain their usual hours of service.

With files from The Canadian Press