Air Canada to Resume Full Service Today Amid Labor Unrest

Air Canada (AC/B) plans to resume regular service today after it canceled about 75 flights yesterday when some pilots failed to report for work amid stalled contract talks.

Canada’s Industrial Relations Board granted the carrier an order yesterday declaring that certain pilots were participating in an illegal strike, Montreal-based Air Canada said in a statement. The board also ordered the Air Canada Pilots Association to “take all reasonable steps” to end the walkout, while requiring all pilots participating in the job action to return to work immediately and “perform their duties in the normal manner,” according to the company.

Canceled flights were mostly to and from Toronto, the airline’s main hub, and other Canadian and U.S. destinations. Air Canada’s overseas flights were not affected. Toronto’s Pearson International Airport is Canada’s busiest airfield.

“While we were able to re-accommodate almost all customers affected on alternate flights, we recognize the inconvenience this job action has caused to our customers,” Duncan Dee, the airline’s chief operating officer, said in the statement. “We thank them for their patience and loyalty. The vast majority of Air Canada’s pilots reported to work today and performed their duties as the true professionals they are.”

Customers who were scheduled to travel by today and wish to change their plans may rebook for free until June 30, the carrier said.

Union Contracts

The disruptions are the latest illustration of how the stalled negotiations over new union contracts are affecting operations at Canada’s largest airline. Pilots are working under the terms of their last accord, which expired in March 2011, after talks begun in October 2010 failed to produce a new deal.

Air Canada feeder carriers such as Chorus Aviation Inc. (CHR/B)’s Jazz unit weren’t affected by the service disruptions. Air Canada operates about 600 flights a day, while Jazz and other regional airlines operate another 900 for the company.

Even after the federal government rushed to Air Canada’s aid in March with a back-to-work bill blocking labor action, passengers still faced flight cancellations as ground-crew employees staged wildcat strikes on March 23. That was five days after so many pilots called in sick that the airline had to reduce its schedule.

Air Canada Pilots Association Chairman Jean-Marc Belanger said yesterday that he sent members a memo on April 12 urging them not to walk off the job after Air Canada contacted the union about reports of a planned sickout. About 3,000 pilots are part of the union.

Frustrated Pilots

“I understand the pilots’ frustration, but it’s not the right thing to do now,” Belanger said yesterday in a telephone interview. “Air Canada (AC/A) is reporting flight cancellations and delays because some pilots are not at their post, but this is not a concerted action. It doesn’t come from the pilots association.”

Canadian Labor Minister Lisa Raitt said the action by pilots was illegal and urged the company and its workers to resolve their dispute.

“Illegal work stoppages have disturbed and disrupted travel for Canadians,” she said in an e-mailed statement.

Air Canada’s pilots are resisting the possible creation of a low-cost unit that would be based abroad, which the union says would result in lower salaries. Chief Executive Officer Calin Rovinescu said in February that the company is “evaluating various models” for a discount carrier, without being more specific.

To contact the reporter on this story: Frederic Tomesco in Montreal at tomesco@bloomberg.net

To contact the editor responsible for this story: Ed Dufner at edufner@bloomberg.net

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