Air Canada could begin suspending flights next weekend as strike deadline nears
Air Canada pilots will be in legal strike position on Sept. 17
Kkritika Suri
Air Canada is on the verge of suspending most of its operations, potentially starting Sunday, as negotiations with the pilot union reach a critical point over "inflexible" wage demands, the airline announced on Monday.
The airline and its budget subsidiary, Air Canada Rouge, are preparing to gradually suspend flights over a period of three days, possibly beginning as early as September 15. The two carriers together handle nearly 670 flights daily.
If an agreement is not reached, either Air Canada or the union may issue a 72-hour strike or lockout notice, leading to a three-day wind-down plan. This shutdown could impact approximately 110,000 passengers each day.
Air Canada is offering customers with travel plans between September 15 and 23 the option to alter their bookings without incurring a fee. Travelers can also cancel their flights and receive a credit for future travel.
Should a strike or lockout notice be issued and a flight is cancelled, Air Canada will inform affected travelers and provide full refunds. However, additional compensation beyond the existing Canadian Airline Passenger Protection Regulations will not be provided.
'Still time to reach an agreement,' says Air Canada CEO
Negotiations between Air Canada and the Air Line Pilots Association (ALPA), which represents over 5,200 pilots at the airline, are ongoing but remain significantly stalled, according to the company.
"Air Canada believes there is still time to reach an agreement with our pilot group, provided ALPA moderates its wage demands, which are significantly above average Canadian wage increases," stated CEO Michael Rousseau on Monday.
ALPA did not immediately respond to a Reuters request for comment.
Last month, 98 percent of pilots voted in favor of job action. The union and the airline entered a three-week cooling-off period, as required by Canadian law, on August 27.
"Our government firmly believes in the collective bargaining process, and Canadians are relying on both parties to reach a deal," said a statement from Canadian Labour Minister Steven MacKinnon's office.
Pilots seek parity with U.S. counterparts
Air Canada's pilots are seeking to align their salaries with those of their higher-paid U.S. counterparts, who secured lucrative labor deals in 2023 due to a pilot shortage and strong travel demand.
"We're flying the same passengers in the same airspace on some of the same routes, yet those pilots are earning significantly more than us," said Charlene Hudy, head of the union's Air Canada contingent, in a statement to The Canadian Press last month.
ALPA pilots have noted that hourly pay rates at U.S. competitor Delta Air Lines can be up to 45 percent higher than those at Air Canada.
"We understand the frustration of Air Canada pilots, but it's important to recognize that the situation differs due to barriers to entry for pilots in the U.S.," wrote TD Cowen analyst Thomas Fitzgerald in a recent note.
Between March and September of the previous year, pilots at Delta Air Lines, United Airlines, and American Airlines secured contracts with pay increases of 34 to 40 percent over four years.
Earlier this year, WestJet pilots ratified a new agreement, averting a strike.
Air Canada expects it would take seven to 10 days to return to normal operations following a complete shutdown. Flights across its network would be canceled over three days, with a total shutdown potentially beginning at 12:01 a.m. ET on September 18.
The company is negotiating with other airlines to assist stranded passengers in the event of cancellations and noted that flights under the Air Canada Express brand, operated by third-party carriers, will continue as scheduled.
