Air Canada and pilots union reach a tentative agreement to avoid a shutdown

Air Canada and the union representing its pilots have come to terms on a labor agreement that is likely to prevent a shutdown of Canada’s largest airline.

Talks betwen the company and the Air Line Pilots Association produced a tentative, four-year collective agreement, the airline announced in a statement early Sunday.

The prospective deal recognizes the contributions of the pilots flying for Air Canada and Air Canada Rouge while setting a new framework for company growth. The terms will remain confidential until ratification by union members and approval by the airline’s board of directors over the next month, the airline said.

The pilots association said its Air Canada Master Executive Council voted to approve the tentative agreement on behalf of more than 5,400 Air Canada pilots. After review and ratification by a majority of members, the deal is expected to generate an additional $1.9 billion for the pilots over the period of the agreement, the union said in a statement.

“While it has been an exceptionally long road to this agreement, the consistent engagement and unified determination of our pilots have been the catalyst for achieving this contract,” Charlene Hudy, the executive council's chair, said in the statement. “After several consecutive weeks of intense round-the-clock negotiations, progress was made on several key issues including compensation, retirement, and work rules."

Federal Labor Minister Steven MacKinnon confirmed the agreement on Sunday and lauded the company and the union.

“Thanks to the hard work of the parties and federal mediators, disruptions have been prevented for Canadians,” MacKinnon said in a statement. “Negotiated agreements are always the best way forward and yield positive results for companies and workers.”

The airline and its pilots have been in contract talks for more than a year. The pilots have sought wages competitive with their U.S. counterparts, but Air Canada continues to post record profits while expecting pilots to accept below-market compensation, the union said

The two sides could have issued a 72-hour notice of a strike or lockout beginning Sunday. The airline said the notice would have triggered its three-day wind down plan and started the clock on a full work stoppage as soon as Sept. 18.

Air Canada spokesman Christophe Hennebelle previously said the airline was committed to negotiations, but faced union wage demands that the company could not meet.

The airline was not seeking federal intervention, but cautioned the government should be prepared to help avoid major disruptions from the possible shutdown of an airline carrying more than 110,000 passengers daily, Hennebelle said.

Business leaders had urged the federal government to intervene in the talks earlier in the week, but MacKinnon said there was no reason the sides should not have been able to reach a collective agreement.

In August, the Canadian government asked the country’s industrial relations board to issue a back-to-work order to end a railway shutdown.

Leaders of numerous business groups including the Canadian Chamber of Commerce and the Business Council of Canada convened in Ottawa on Thursday to call for action, including binding arbitration, to avoid the widespread economic disruptions of an airline shutdown.

NDP Leader Jagmeet Singh said Thursday his party would not support efforts to force pilots back to work.

“If there’s any bills being proposed on back to work legislation, we’re going to oppose that,” he said.