Air Canada to lock out flight attendants amid contract dispute

Air Canada has issued the statutory 72-hour lockout notice to the Canadian Union of Public Employees (CUPE), representing 10,000 flight attendants at Air Canada and Air Canada Rouge, following the union’s notice of its intention to strike. The airline will begin a phased suspension of most operations, to be completed over the next three days, in order to give customers certainty and to minimise disruption. Air Canada has also sought government-directed arbitration to resolve the dispute.

Air Canada Express flights, operated by Jazz and PAL Airlines, will not be affected, although these regional partners only carry about 20 per cent of Air Canada’s daily customers. Air Canada and Air Canada Rouge together transport around 130,000 customers daily, including 25,000 Canadians returning home from abroad, who may be stranded if a full work stoppage occurs.

The airline stated that despite eight months of negotiations, assisted by federal conciliators, and an offer to enter binding arbitration, no tentative agreement has been reached. On 11 August, Air Canada presented CUPE with a revised proposal, which it said included no concessions from flight attendants and offered a total compensation increase of 38 per cent over four years. The proposal also addressed ground pay, improved pensions and benefits, increased crew rest, and other enhancements. CUPE rejected the offer and issued strike notice for as early as 16 August.

Michael Rousseau, President and Chief Executive of Air Canada, said: “We regret the impact a disruption will have on our customers, our stakeholders and the communities we serve. However, the disappointing conduct of CUPE’s negotiators and the union’s stated intention to launch a strike puts us in a position where our only responsible course of action is to provide certainty by implementing an orderly suspension of Air Canada’s and Air Canada Rouge’s operations through a lockout. As we have seen elsewhere in our industry with other labour disruptions, unplanned or uncontrolled shutdowns, such as we are now at risk of through a strike, can create chaos for travellers that is far, far worse.”

He continued: “Our latest offer included a 38 per cent increase in total compensation over four years that would have made our flight attendants the best compensated in Canada, along with provisions for ground pay and other work-life balance, career and pension improvements. At the same time, we asked for no concessions from the union. Given this, while we remain available for discussions with CUPE, we have requested government-directed arbitration as we now view it as the only certain avenue to bring closure to bargaining and mitigate the impact on travellers, business and the Canadian economy.”

Air Canada said it had proposed to CUPE that the parties appoint a third-party independent arbitrator to help finalise a new agreement through binding arbitration, but the union rejected the offer. The airline has now asked the Canadian government to use its authority under section 107 of the Canada Labour Code to direct binding interest arbitration before a work stoppage takes effect. Air Canada believes government intervention in similar cases involving rail, ports, and airlines has set a proven precedent.

The Canada Labour Code is intended to encourage industrial peace when bargaining reaches an impasse. Air Canada argued that, despite prolonged negotiations and an offer it describes as unprecedented, there is no prospect of resolving the dispute in the near term. The airline said that the resulting hardship would be felt by Canadians, businesses, and the wider economy.

Air Canada stressed that a controlled wind down is far less disruptive than an unmanaged strike. A phased suspension, it said, will allow the airline to advise customers in advance, reduce the risk of passengers being stranded, and give both the company and its customers time to make alternative arrangements. It also allows aircraft and crew to be positioned in a way that maintains routine maintenance and enables a faster resumption of services once the dispute is resolved.

The first flight cancellations will begin on 14 August, followed by more on 15 August, with a complete halt to operations at Air Canada and Air Canada Rouge by 16 August.

The airline acknowledged the significant disruption this will cause, particularly during the busy summer travel season, but insisted the approach is necessary to avoid the greater chaos of a sudden, unmanaged shutdown. Air Canada operates to approximately 65 countries on six continents with a fleet of 259 aircraft, and a sudden halt would have a major operational and financial impact.

For customers whose flights are cancelled, Air Canada will issue notifications and provide full refunds, available via its website or mobile app. The airline has made arrangements with other Canadian and foreign carriers to offer alternative travel where possible. However, due to the peak summer period, many flights on other airlines are already full, so securing seats could take time and may not be immediately possible.

Air Canada is also introducing a flexible rebooking policy, allowing customers to change or postpone travel without extra cost. The airline will inform passengers of their rights under applicable regulations if flights are cancelled or delayed, and will meet its legal obligations.

Customers are strongly advised not to travel to the airport unless they have a confirmed booking and their flight is confirmed as operating. Flight status can be checked on the Air Canada website or mobile app before departure. Air Canada also urged passengers to use self-service tools where possible, as call centre wait times are expected to be very long.

The airline has set up a dedicated information page, including frequently asked questions, at www.aircanada.com/action to help passengers understand their options and keep updated on developments.

Air Canada reiterated that it remains available for further discussions with CUPE and is open to arbitration to reach a resolution, but said that in the absence of agreement, a lockout with a managed shutdown is the most responsible way to protect customers and safeguard operations from the worst effects of a strike.

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