Air Canada Unions Want New Talks

Air Canada's unions want to go back to the bargaining table, buoyed by the recent success of the restructured carrier just 16 months out of bankruptcy protection.

Several Air Canada union executives said they plan to write the company in the next week to advise that they want to trigger the clause to reopen talks on pay and benefits.

Union leaders met in Toronto last week to plot their strategy for meetings with the airline.

Unlike many of its competitors in the troubled airline industry, Air Canada's parent, ACE Aviation Holdings Inc., has been a Bay Street darling in recent months.

The airline has been selling out flights at a record pace, and has engineered a $200 million spin-off of part of its Jazz regional carrier. And shareholders two months ago approved giving themselves a special payout worth as much as $300 million.

None of that news escaped the attention of the several unions at Canada's biggest airline.

When Air Canada's union's agreed to surrender a collective $1.1 billion a year worth of pay and benefits as part of the company's restructuring, they received the right to reopen their five-year labour contracts this spring to negotiate better wages.

Now, the carrier's flight attendants, reservation agents and mechanics want to share in the company's profits.

"The morale of all of the employees is so low," said Pam Sachs, an official with the Canadian Union of Public Employees, which represents 7,000 Air Canada flight attendants.

"We've seen the company's top executives sell their shares and we've seen the special payout to shareholders.

"Everyone else has been rewarded for how this company has performed coming out of its bankruptcy protection," said Sachs, whose union agreed to a 13.5 per cent pay cut worth $138 million a year as part of Air Canada's restructuring.

"We want that money back," Sachs said.

Air Canada spokesperson Isabelle Arthur said in a statement that, "despite a difficult environment caused by the rising cost of fuel, we've made good progress since we've emerged from CCAA (Companies' Creditors Arrangement Act).

"We need to continue changing the way we do business in order to keep Air Canada moving forward for long-term viability and success.

"The upcoming wage review will take place against this backdrop, and one of our goals entering these discussions is to improve the way we work with union leadership at Air Canada," Arthur wrote.

Talks between Air Canada management and union leaders over the next few months may be difficult.

The flight attendants were among several unions that were rebuffed by Air Canada when they demanded Air Canada's parent company put any extra cash toward narrowing the shortfall in the company's pension plans for retiring employees. Air Canada's pensions have a shortfall of about $1.4 billion.

"With the way things have gone in the past few months, it's not like they can cry poor," said Paul Lefebvre, an official with the International Association of Machinists and Aerospace Workers, which represents Air Canada's machinists and ramp workers.

While Air Canada's balance sheet has shown improvements in recent months, making it one of the few profitable North American-based carriers, the airline's labour relations remain poor, several union leaders said.

Even so, the wage talks probably won't be cutthroat.

The unions don't have the right to strike or take any kind of job action until their contracts expire in 2009. If the carrier and its unionized employees can't agree on a new pay scale, the matter will go to binding arbitration.

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