Pilots Union Takes Concession Vote To The Wire

Air Canada confirmed that it reached a tentative agreement Sunday on labor cost realignment with the Air Canada Pilots Association (ACPA), representing its 3,150 mainline pilots. With this agreement Air Canada will achieve an overall labor cost saving of C$1.1 billion a year.

"ACPA faced unique and complex issues and while the sacrifices agreed to in the tentative labor agreement are painful, they are unavoidable to secure Air Canada's future," said Robert Milton, President and Chief Executive Officer. Tentative agreements were reached earlier last week with the International Association of Machinists and aerospace Workers (IAMAW) representing 11,000 technical operations and airport ground service personnel, CUPE representing 6,700 flight attendants, the CAW Airline Division, representing 6,000 customer sales and service agents and crew schedulers and CALDA, representing the airline's 100 flight dispatchers.

Other Agreements

Tentative agreements were also reached with all unions representing Air Canada Jazz employees - the Airline Pilots Association (ALPA), CALDA, CUPE and Teamsters Canada. "I salute Air Canada's union leadership for doing the right thing under trying circumstances to ensure the survival of this great airline," said Milton "I recognize what a difficult and unsettling time this has been for all of Air Canada's employees. A successful ratification of all the tentative agreements will establish the foundation to move forward with lessors, lenders, key suppliers and other stakeholders.

"Justice Warren Winkler conducted an extremely disciplined and focused mediation process which took account of the urgency of reducing our costs immediately within CCAA," he continued. "This successful outcome could not have been achieved within the necessary timeframe without his tireless efforts in addition to those of Murray MacDonald of Ernst & Young, the Court-appointed Monitor. With this significant hurdle in our restructuring behind us, I wish to reassure Air Canada's customers that it is business as usual and I encourage them to continue booking Air Canada with confidence," said Milton.

Big - And Much Needed - Savings

With the tentative agreements, the company will achieve $766 million (including benefits) in labor cost realignment at the mainline carrier in addition to $120 million to be realized from the non-unionized and management ranks. Additional cost savings resulting from the realignment of the airline to a smaller network are expected to generate $110 million.

With the tentative agreements in place, Air Canada Jazz will reduce labor costs by $110 million for a total consolidated labor cost saving of $1.1 billion. The labor cost reductions will be achieved primarily through productivity improvements including job reductions and wage rollbacks. Details of the agreements reached by the individual unions will be provided separately by the unions to their membership. The agreements are subject to ratification. Air Canada will initiate discussions in the coming days with its unions outside of Canada with the objective of achieving appropriate cost savings.

FMI: www.aircanada.ca