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Yesterday at 5:00 p.m. Air Canada delivered an ultimatum to its employees. We had 13 hours to surrender our contractual rights or the company would proceed to file for bankruptcy protection.

Robert Milton demanded that we accept:

an immediate across-the-board wage cut of 22 per cent

a permanent freeze on wages

an end to layoff protection

We negotiated through the night to find a resolution. But it was not possible to accept such a deal. Our members – among the lowest paid of Air Canada’s employees – could not afford to support their families if their wages were cut by almost a quarter.

We are not convinced these concessions would lead to the types of changes that are needed to make Air Canada strong. And we could get no assurance from the company that were we to accept these terms it would not file for bankruptcy protection in any event.

CUPE is committed to making Air Canada a strong, viable enterprise that serves the public well, treats its employees fairly and competes on a sustainable basis with major airlines around the world and within Canada.

As a demonstration of our good faith, we agreed this past year to allow Air Canada to operate ZIP at wages comparable to those of WestJet, a move no other employee group has made. This represents a labour cost saving of $7.8 million each year – a substantial contribution to the goal of ensuring Air Canada remains competitive.

Although we disagree with the announced layoff of 600 flight attendants, it does result in a further cost savings to the company of $24 million for a total of $32 million from among the lowest paid of the Air Canada employee groups.

We believe there are other changes that can be made to the way Air Canada operates that would improve efficiency and service levels and contribute to the financial health of the company. But we see no willingness on the part of Mr. Milton and Air Canada’s management to engage in serious discussions to identify these solutions.

Regrettably, the federal government has made itself complicit in this avoidable bankruptcy filing. Transport Canada bears great responsibility for the financial position of Air Canada – having created an unregulated monopoly at the same time it has promoted an industry-wide regime of deregulation. Worse still it has pushed Air Canada down the road to bankruptcy protection by making its support conditional, offering a $300 million incentive. This “reign of error” has been disastrous for Air Canada and for Canadians.

Canadians look to Canada’s national carrier to meet their needs to connect from coast to coast and around the globe. They want a reliable, affordable full-service operation, serving not only metropolitan centres but communities large and small. There are structural costs to providing such a vital service and the federal government has to get serious about its obligation to support it.

Air Canada pretends that its employees are at the root of its problems. We believe that Air Canada management – and federal inaction – are the root of Air Canada’s problems. Nonetheless, we are prepared to meet with Air Canada and with federal officials at any time to discuss real solutions to the issues facing Air Canada.

And we remain convinced that working together in good faith we can identify a strategy that will make Air Canada a stronger and more viable airline while defending the legal and contractual rights of our members.

Pamela Sachs, President

and Executive Committee

Air Canada Component