Newspaper article The Canadian Press

Air Canada Approaches Pilots for Early Discussions Leading to Longer Contract

Newspaper article The Canadian Press

Air Canada Approaches Pilots for Early Discussions Leading to Longer Contract

Article excerpt

Air Canada preparing for new labour talks

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MONTREAL - Air Canada is moving to begin contract negotiations with its pilots union early in hopes of avoiding the acrimony that marked the last round talks that ended up being eventually settled by a federal arbitrator.

"We are in talks to determine if there is basis for achieving an early renewal of the pilots' collective agreement," Air Canada spokeswoman Isabelle Arthur wrote in an email.

The pilots union typically has four-year deals, but a five-year deal retroactive to April 2011 was selected in 2012 in final-offer arbitration.

The Air Canada Pilots Association said the airline approached it to discuss changes prior to the contract's expiry March 31, 2016.

"The current contract is the result of an arbitration award and our members would also like to see changes and improvements, which we are discussing with Air Canada," said an union spokesman who was unwilling to provide details.

Chris Murray of AltaCorp Capital said a longer contract would offer additional stability.

"We believe a longer-term agreement, particularly in advance of the current expiry in the first quarter of 2016, would be very constructive in reducing the company's risk profile," he wrote in a report following recent meetings between airline management and institutional investors.

In addition to pilots, Air Canada is set to open talks with flight attendants and customer service representatives, ahead of the contract's expiry March 31, 2015.

"We are presently preparing for the next bargaining round. We will consult our members soon to set our priorities," said Michel Cournoyer, president of the Air Canada Component of CUPE, which represents 6,500 flight attendants.

Murray said Air Canada (TSX:AC.B) indicated that unlike the last round of negotiations there are just "a few number of highly contentious issues" for flight attendants and customer service workers this time.

Pension issues have long been a major area of dispute. But structural changes have already been made by moving new hires to cheaper defined-contribution pension plans, and the airline has eliminated its pension deficit. The launch of low-cost subsidiary Rouge that is able to service leisure markets more profitably by using lower-wage employees and planes with more seats has also created new opportunities for younger pilots, especially given the Supreme Court of Canada's decision to raise the retirement age to 65, he said. …

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