Wheelie bins will be left full on kerbs in suburbs across Canberra's inner north and south on Friday when 39 drivers walk off the job, as negotiations between the Transport Workers' Union and contractor Suez break down.

But Suez's ACT manager Jason Stewart said the company was "extremely disappointed" over the planned industrial action given their offer was "fair and reasonable".

"Our drivers are paid well above award and on average earn $95,000 per annum with many employees paid in excess of $100,000 (gross) per year," Mr Stewart said.

"In our proposal, we will pay wage increases of 3 per cent per annum above the national CPI of 1.3 per cent and increase redundancy entitlements to provide employees with an additional three to four weeks' severance payment above the national employment standards should their employment terminate at the end of the contract."

Klaus Pinkas from the Transport Workers Union said severance pay was the crux of the negotiations.

He said severance pay was dropped from three week's pay to two when the contract changed hands two years ago, despite assurances from the ACT government this would not happen.

"This is the first chance they've had to strike in two years as they've been on probation [because of the new contract]. They don't take this kind of action lightly," Mr Pinkas said.

Mr Pinkas said it was a hot button issue for workers due to the nature of their contracts.

"We had a driver who had been employed for 30 years who had sore knees but hadn't missed a day of work. When the contract ends every 10 years the drivers have to reapply for their jobs and he lost his job as he didn't pass the medical this time around," Mr Pinkas said.

The Fair Work Commission has been called in as a mediator between Sues and the union as they debate the details of the new agreement.

But Mr Stewart said: "Our offer is fair and reasonable and our drivers will remain amongst the best paid in the industry."

Strike action was announced on Tuesday in an attempt to resolve the protracted pay negotiations.

Affected suburbs include: Ainslie, Duntroon, Narrabundah, Barton, Forrest, Oaks Estate, Beard, Franklin, O'Connor, Braddon, Griffith, Pialligo, Campbell, Hackett, Red Hill, City, Harrison, Reid, Deakin, Hughes, Turner, Dickson, Kingston, Watson and Yarralumla.

Residents should leave their household waste and recycling bins out regardless as missed collections are likely to be picked up on Saturday.

A Suez spokeswoman said extra drivers would be rostered on from Saturday through to Monday to ensure all missed bins were collected.

ACT NOWaste director Michael Trushell encouraged neighbours to share bin space and try to minimise their waste.

"We would encourage people to be mindful of their waste generation over the next few weeks," Mr Trushell said.