Tentative Agreement Secures Timely Cargo Deliveries
Air Canada and the union representing over 5,200 pilots announced a tentative four-year contract agreement on Saturday night, successfully avoiding a potential strike that could have occurred within days.
The preliminary deal awaits ratification from the members of the Air Line Pilots Association. Air Canada (TSX: AC) has stated that the terms of the contract will remain confidential until the ratification vote, which is expected to occur within a month, as well as the approval from the Air Canada board of directors. A majority approval from the voting membership is required for ratification.
According to ALPA, the tentative agreement is projected to provide pilots with an additional $1.9 billion in value over the contract’s duration. Canadian media reports indicate that pilots will receive a 42% pay increase, with a significant portion retroactive to September 2023.
“After weeks of intensive negotiations, we made progress on several important issues, including compensation, retirement, and work regulations. If ratified by the pilots, this agreement will effectively conclude our outdated ten-year framework,” stated Charlene Hudy, chair of the Air Canada Master Executive Council and a first officer at the airline.
A moratorium on either party implementing pressure tactics was set to expire on Sunday if an agreement was not reached in the 15-month labor dispute, thus allowing pilots to provide three days’ notice for a potential strike.
In recent days, business groups and Air Canada urged the Canadian government to intervene and initiate binding arbitration if no resolution was achieved. Industry trade associations had warned that a work stoppage at Air Canada, which transports cargo in the holds of passenger planes and on six Boeing 767-300 freighters, would negatively impact agricultural, manufacturing, and medical supply chains reliant on air transport for time-sensitive deliveries.
To prevent shipments from being stranded in the event of a strike, Air Canada Cargo had ceased accepting certain types of specialized cargo as the week progressed.
