The head of the Public Service Alliance of Canada (PSAC) union announced on Monday that if they are unable to achieve a pay agreement with the federal government, about 155,000 public employees in Canada will go on strike at midnight on Wednesday.

Chris Aylward, the president of PSAC, declared that he was “putting a clock on this round of bargaining” and threatened to organize a strike if a settlement was not reached by Tuesday night at 9 p.m. ET (0100 GMT).

The strike would affect federal services and could delay tax refunds since about 35,000 workers at the revenue agency would walk out in the middle of tax filing season. Passport renewals ahead of summer travel could also be delayed.

“Despite some progress at the bargaining table, our members are frustrated that while negotiations drag on, they continue to fall behind,” Aylward told reporters. “We’ve always said from day one, we need wages for our members that will keep up with inflation.”

PSAC has been in collective bargaining for a new contract since 2021. Tax agency workers initially sought a pay bump of more than 30% over three years, and others are asking for 13.5% over three years. Inflation peaked at 8.1% last year.

Aylward said the offers received so far had fallen short. Prime Minister Justin Trudeau said he was hopeful a deal would be reached to avert a strike.

“There have been constructive advances and offers and we’re very hopeful that we’re going to be able to resolve this, but it’s at the bargaining table that these things happen and we will continue to do that be there in good faith and work on trying to resolve this for all Canadians,” Trudeau told reporters.

The strike would also affect 65% of employees at the Canadian Grain Commission, including most inspectors of outbound grain at ports, according to the commission. Canada is a major wheat and canola exporter.

The commission is working on contingency plans with grain companies to ensure that “critical grain exports can continue,” during a strike, spokesperson Remi Gosselin said.