Air Canada - Bumpy Ride? Contracts

[Kip Powick]

Fasten your seat belts. It could be a turbulent summer of labour unrest for Air Canada.

With all its major union contracts expired, the airline which, has only recently returned to profitability, is eager to take off in a new direction.

But a proposed low-cost carrier to vacation destinations in Europe and down south to compete with the likes of Air Transat has already set off alarm bells for Air Canada’s employees, who have made concessions over the years to save the company.

“Air Canada’s members, they are all upset. They have done a lot to help out this airline,” said Carlos DaCosta, airline coordinator for the International Association of Machinists and Aerospace Workers, which includes ground crews, mechanics and baggage handlers. “They sacrificed to save the airline.”

And as unions are being asked for significant changes, including new pension schemes and switching new hires to defined contribution plans over defined benefit plans, the airline revealed the total compensation packages for its top executives, including president and CEO Calin Rovinescu, whose pay jumped nearly 77 per cent to $4.5 million last year.

“Our members are rattling the cage,” said DaCosta. “Their expectation, before they heard that, was at these negotiations we need a lot of gains, 10 years’ worth.

“And now they’re looking at what he’s getting and (other executives) all the way down the ladder . . . they’re saying, not only do we want gains, but it better be comparable,” DaCosta said.

No strike dates have been set yet. In some cases, the unions are in the early days of negotiations with the initial exchanges of proposals between labour and management.

At Air Transat, one of Air Canada’s targets with its proposed discount carrier, flight attendants asked Thursday for a federal conciliator to help with contract talks that began last September.

“It’s not a bad thing to have conciliation for both sides,” said Nathalie Stringer, president of the Air Transat component of CUPE, which represents 1,400 flight attendants.

At issue are efforts to boost the hours on duty per day as well as create a different pay scale for new hires, which would penalize junior staff, Stringer said.

By filing for conciliation, CUPE kicks off the countdown process to a possible legal strike or lockout in the last week of July. Air Transat reached a deal with its 300 pilots last fall.

In Air Canada’s negotiations, it is furthest along with its pilots, having reached a tentative deal last month.

But the union suffered a huge setback last week when rank-and-file members signalled their opposition to the contract, which one pilot described as a complete rewriting of the collective agreement.

The deal also calls for changes to working conditions and a significantly lower wage scale for pilots who would operate large aircraft for the discount airline. The two-tier pension system is another sticking point.

As a result, the union abruptly cancelled a scheduled ratification vote because of the anger — and is returning to the bargaining table with management.

“It could be a couple of days or it could be a couple of weeks,” said Paul Strachan, president of the Air Canada Pilots Association, noting formal notice to bargain was only filed at the end of the March so any labour disruption would be months away. “It’s operations normal.”

At the same time, the union is also holding a 10-day recall vote on the top union official, captain Bruce White, after an online petition for the recall vote garnered nearly 1,500 votes, almost half of its 3,000 pilots, over White’s handling of the negotiations.

“Democracy is messy,” Strachan said, adding results are expected on May 2. “It is part of the process contained within our constitution. Our membership will decide.”

The Canadian Auto Workers, which represents 3,800 customer service agents, has scheduled strike votes on May 16, with a strike deadline of June 13.

“At this point, I’m not optimistic that we can reach a settlement,” said Bob Chernecki, assistant to CAW president Ken Lewenza.

“I can tell you that we’re not going to agree with two areas of the pilots’ deal,” Chernecki said. “They’re after a two-tier pension plan, which we’re not going to do. We’re not going to do a low-cost airline.”

[internet]

Keep thinking it's 1962 and you're working at PanAm folks... you get what you deserve.

[deicer]

What is being glossed over here is the fact that Calin got his 70% increase from meeting the 'metrics' of his contract.

If it wasn't for the front line employees buying into his vision, would he have met those 'metrics'?

These are the employees who haven't had a raise since the year 1999, who have kept the company alive, even after it was raped by Milton and Cerberus.

Wouldn't one think that if Calin wishes to keep achieving his 'metrics', that some of rewards should be trickled down to those who made him look good?

Because, one would think, they could make him look bad just as fast.

The two faced nature of Calin posting letters saying that the employees have made AC what it is don't mean squat when he makes off like a bandit at the expense of the rest.

Otherwise, the model is broken, the greed for those on top is too great, nothing has changed in management, and the great equaliser would be to kill the beast and wait for the Phoenix to rise from the ashes.

[internet]

Ok. Screw the airline, your co-workers and yourself to get back at Calin.

[dagger]

Wouldn't one think that if Calin wishes to keep achieving his 'metrics', that some of rewards should be trickled down to those who made him look good?

You make it sound like there is no wage increases in the pilot deal and hence other contracts coming, or that you didn't get any performance related payments on a monthly or yearly basis, or that there weren't increases in 2005-06.

Personally, I'd like to see the government let AC fold this time and a new international airline started. Brazil certainly survived Varig's demise.

[DEFCON]

Dagger may have the idea that many will see as, 'the way to go'.

Nonetheless...people are getting more than a little tired of arrogant executives & compensation levels that are nothing short of 'obscene' when compared to the historical norm. The modern MBA serves himself first!

[deicer]

You make it sound like there is no wage increases in the pilot deal and hence other contracts coming, or that you didn't get any performance related payments on a monthly or yearly basis, or that there weren't increases in 2005-06.

Personally, I'd like to see the government let AC fold this time and a new international airline started. Brazil certainly survived Varig's demise.

Morning Dagger

If there are wage increases in this round of negotiations, then it will be the first in 11 years. Up to now we have only gotten incremental snap backs that have us at wage levels still below back then. Even with the 'performance bonus' we are still making less than we were in 1999. I don't know where you live, but everything I have to pay for over the last decade has risen in price.

I will repeat what I have said before, we are in times akin to the late 19th century where the Robber Barrons are having their way.

If it is a matter of the government letting it fold, then all three legs of the stool will be cut down equally. So be it.

Gday Internet...

It isn't a personal thing against Calin, it's just that he's the face of the beast. As well, please explain to me once again why the employees of AC have to sacrifice so that he, and the rest, can benefit?

Iceman

[conehead]

Keep thinking it's 1962 and you're working at PanAm folks... you get what you deserve.

No, it is indeed 2011 and you get what you negotiate. If I got what I deserve I would be making more money than I do right now. If we don't like whatever comes out of these negotiations, than we will strike if necessary. If the company needs to be shut down, then so be it. If they go out of business, then so be it. I refuse to be lied to and taken advantage of anymore.

[CanadaEH]

So you're rather be unemployed than have a job making what you earn today?

[conehead]

That's the point; I wouldn't be unemployed. I have marketable skills that are currently in demand, and I can earn more than Air Canada pays.

[dagger]

Morning Dagger

If there are wage increases in this round of negotiations, then it will be the first in 11 years. Up to now we have only gotten incremental snap backs that have us at wage levels still below back then. Even with the 'performance bonus' we are still making less than we were in 1999. I don't know where you live, but everything I have to pay for over the last decade has risen in price.

Nice twisting of the language there. You got raises in 2005-06 whether you want to call them that or not. And yes, there are raises planned in the 2011 agreements as evidenced by what the pilots were offered. As for what you are being paid now, or were 10 years ago or will in 2012, AC is just another airline now, and it will have to have wage rates that are competitive. simple as that. The world has changed a lot since 1999. I actually made more money in 1999, but have made lifestyle changes to adjust for that. You might say the customer base I work with has changed for good. They won't pay me like they once did. One of my customers once had a $100 million global marketing budget and now spends about a quarter of that.

Needless to say, the old ways of spending it have changed. Whereas once this company sponsored a Formula 1 racing team, and flew customers from around the world for weekends of gluttony and inebriation (perhaps even debauchery although I never saw any), they now do things much, much more modestly. Do I regret that the gravy train has stopped, do I feel a sense that they should go back to the old ways, or have I adjusted to the new frugality and accepted that their competitive environment won't allow it any more?

I'll let you guess.

[FireFox]

Nice twisting of the language there. You got raises in 2005-06 whether you want to call them that or not. And yes, there are raises planned in the 2011 agreements as evidenced by what the pilots were offered. As for what you are being paid now, or were 10 years ago or will in 2012, AC is just another airline now, and it will have to have wage rates that are competitive. simple as that. The world has changed a lot since 1999. I actually made more money in 1999, but have made lifestyle changes to adjust for that. You might say the customer base I work with has changed for good. They won't pay me like they once did. One of my customers once had a $100 million global marketing budget and now spends about a quarter of that.

Needless to say, the old ways of spending it have changed. Whereas once this company sponsored a Formula 1 racing team, and flew customers from around the world for weekends of gluttony and inebriation (perhaps even debauchery although I never saw any), they now do things much, much more modestly. Do I regret that the gravy train has stopped, do I feel a sense that they should go back to the old ways, or have I adjusted to the new frugality and accepted that their competitive environment won't allow it any more?

I'll let you guess.

Nice spin dagger. You have left out an important point from deicer's argument, that of executive compensation.

Perhaps you should tell the likes of Calin & Miltie that they should lead by example and embrace the "new frugality" when it comes to their personal compensation.

[deicer]

Thank you Gatekeeper.

That's the part they keep glossing over.

The culture of fear is coming to an end.

Iceman

[Leading Edge]

You losers that post your management anti-union BS don't understand, we are willing to push it all the way...

Remember we are supposedly an essential service.

I am tired of a declining living standard. For 10 years I have gone backwards while the complete lack of competent management has destroyed this company. Well no more.

If it disappears then so be it, there are lots of jobs out there - paying more I have lived overseas before, the complete lack of taxes was wonderful.

If it goes under, well I hope that you enjoy riding the bus, or the all economy WJ service that will be swamped. It will take years to replace AC, if it is even possible. Toronto - Dubai - Vancouver, that should be a real treat. The EI ranks will swell big time, get ready for more taxes... $10B hit to the economy should just about = a direct 1% GDP reduction, which will be 4-5% indirect reduction = RECESSION.

Yep you guys are really a smart bunch...

In the end, I don't give a $hit what you think.

Sign a me **bleep** off employee.

[FA@AC]

There won't be strikes at AC, or at least not strikes of the type that will shut the airline down. A shutdown at Jazz, while messy, wouldn't have caused anywhere near the mayhem that a shutdown at AC would cause, yet Harper unmuzzled his Minister of Labour (or whatever they call the position now) for long enough to have her make clear that the Jazz pilots would be legislated right back to work if they struck. Chretien's Minister of Labour strongly hinted at the same when AC's pilots were on the verge of a strike back in 2000.

I expected that negotiations this time would be less contentious than previous ones. I guess I had that one wrong, but I still think that heads cooler than those of some who post here will prevail. Settlements will be reached at the bargaining tables, or they'll be imposed.

[Guest]

Morning Dagger

If there are wage increases in this round of negotiations, then it will be the first in 11 years. Up to now we have only gotten incremental snap backs that have us at wage levels still below back then. Even with the 'performance bonus' we are still making less than we were in 1999. I don't know where you live, but everything I have to pay for over the last decade has risen in price.

I will repeat what I have said before, we are in times akin to the late 19th century where the Robber Barrons are having their way.

If it is a matter of the government letting it fold, then all three legs of the stool will be cut down equally. So be it.

Gday Internet...

It isn't a personal thing against Calin, it's just that he's the face of the beast. As well, please explain to me once again why the employees of AC have to sacrifice so that he, and the rest, can benefit?

Iceman

That is not entirely factual.The airports group had their wages snapped back when the part time levels were achieved and then had the minor incremental increases that the entire bargaining unit recieved, FYI, that snap back did NOT apply to maintenance.

[Guest]

Thank you Gatekeeper.

That's the part they keep glossing over.

The culture of fear is coming to an end.

Iceman

When we negotiated the agreement in 2009, one of the clauses that was put in was there was to be ZERO wage increases, enhancements or bonuses of any kind for management and executives, I believe that was to carry through till 2014. So in my opinion, this is a direct and intentional violation of the agreement and it should be challenged even if it means walking off the job. We also had a provision put in that if the agreements was violated or the company was on good financial footing, wage increases were to be retroactive to 2009.

[deicer]

Happy Easter Robert

I beg to differ.

If you go on the portal to MY HR and pull up the history of your employment, it will show you what your wage was back to 2001 at this point.

Based on what I see there, that is why I say I'm making less now than then.

Maybe you should check yours.

Iceman

[Guest]

Happy Easter Robert

I beg to differ.

If you go on the portal to MY HR and pull up the history of your employment, it will show you what your wage was back to 2001 at this point.

Based on what I see there, that is why I say I'm making less now than then.

Maybe you should check yours.

Iceman

Thanks, I did not know that option existed, That is a helpful item.

You may want to talk to the Union office as the snap back happened, you may have been lost in the shuffle and have a mondo retro cheque coming your way

[internet]

If you don't like it - leave. Simple. Why is that so hard for all of you. If WJ is better - go there. If foreign airlines are better, go there. If Walmart is better, go there. Leave or shut up.

If enough of you go away and Air Canada can't find any replacements at current wages and conditions, they will obviously have to compensate people more. I assume they wouldn't have any problems hiring.

Clearly the current wage AC is paying you is enough because you are still there.

I hate the Superstore, with long lines, dirty stores and unfriendly services, but the prices are better, so I put up with their crap. I can speak with my wallet and my shoes, and I chose to do neither. So you never hear me complaining about it.

[Guest]

If you don't like it - leave. Simple. Why is that so hard for all of you. If WJ is better - go there. If foreign airlines are better, go there. If Walmart is better, go there. Leave or shut up.

If enough of you go away and Air Canada can't find any replacements at current wages and conditions, they will obviously have to compensate people more. I assume they wouldn't have any problems hiring.

Clearly the current wage AC is paying you is enough because you are still there.

I hate the Superstore, with long lines, dirty stores and unfriendly services, but the prices are better, so I put up with their crap. I can speak with my wallet and my shoes, and I chose to do neither. So you never hear me complaining about it.

You just did!!!!!!!!!!!!!!!