Pilots Agree to Six-Year Contract

Seven of eight Air Canada pilots exercised their franchise, and voted Monday, on the latest contract offered by the bankrupt airline. The airline, needing more flexibility, especially in seniority rules, hoped against hope tha tthe membership would give management one more chance to dig the airline out of the financial pit it's in.

Of those 88% of the 3300 or so eligible voters who voted, a whopping 87% OK'd the deal.

The infighting among Air Canada regulars and the former Canadian Airlines pilots, already "settled" in arbitration, was the subject of speculation that perhaps the vote would be closer. Opponents were vocal, said union president Don Johnson: "We were being inundated with e-mails from people who were upset and angry and going to do all kinds of things; so we tried very hard to separate the issues. It's obvious by the vote that we were able to do that... The ratification of this deal – and the high turn out for the vote – demonstrates that, collectively, our members recognize the severity of the issues facing Air Canada and are willing to do what it takes to get our company back to a profitable footing."

Johnson sounded relieved at the outcome. He told reporters, "We have a united group on the issue of getting this company back on its feet and moving forward."

Air Canada, which was granted "protection" under the federal Companies' Creditors Arrangement Act three months ago, is still scurrying to put its emergence plan together. The pilots' contract goes a long way toward making the future less murky.

Air Canada president Robert Milton released a statement to all the company's unions, thanking and praising them for their team spirit and rational behavior. Part of that statement read, "With the solid support of its employees and their union leadership, Air Canada will emerge from CCAA stronger and well-positioned to compete profitably in the new environment. Clearly, Air Canada's employees are also saying that it is business as usual for Air Canada's customers. On their behalf, I thank our customers for their continued support and encourage them to continue booking Air Canada with confidence."

The two most-immediate consequences of the new contract: 317 pilots will lose their jobs; and work rules will change, allowing the airline more latitude in assignments and other arrangements. Oh -- and the pilots' pay scale will drop... 15%.

The new contract's provisions are designed to save the airline a quarter of a billion dollars a year.

More good news: Jazz, too.

Jazz, Air Canada's low-fare division, also had union votes on Monday; the pilots, flight attendants, dispatchers, schedulers, and maintenance workers got together, and voted away some $110 million (CDN) toward helping the parent stay afloat.

Now it's up to management.

FMI: www.aircanada.ca