Progress has been made on remote work and wage increases for Treasury Board employees, the union said on Sunday, bringing an end to a strike by approximately 155,000 Canadian federal government employees closer.

Public Service Alliance of Canada (PSAC) stated that the strike would continue for now despite ongoing negotiations over a deal for revenue agency employees. The union has stated that its actions will "escalate" on Monday.

Since last Wednesday, when 120,000 Treasury Board employees and 35,000 revenue agency employees represented by the PSAC went on strike, many public services, from tax returns to passport renewals, have been impacted.

Chris Aylward, national president of PSAC, stated, "At Treasury Board, we made some progress on remote work language, and both sides have moved to get closer to a resolution on wage increases."

He added that negotiations with the government regarding wage increases for revenue agency employees who supervise tax returns have not advanced.

The revenue agency employees desired a pay increase of 22.5% over three years. In contrast, the Treasury Board employees who supervise the federal government administration desired a pay increase of 13.5% over three years. The government offered a 9% increase over three years to both categories.

Last year, the annual inflation rate in Canada peaked at 8.1% but has since dropped to roughly half of that level.

In addition to increased wages, the union also demands the option to labor from home.

On Sunday, a government spokesperson told Reuters that the government had received an offer from the union the previous evening and made a counteroffer in response but did not provide any additional information.