Infuriating. That’s an understatement. When you look at the labour dispute that is brewing at Air Canada, you get the impression that you are watching a quarrel between two spoiled children – the employees and the shareholders – who are tearing each other apart over the jewels of the former Crown corporation.
Everyone wants to capture the maximum of the fabulous income generated by this former monopoly which still calls the shots in air transport in the country, with market shares almost twice as high (47%) as those of its rival WestJet (27%).
And the passengers in all this? They are the big losers. As usual.
Legally, a strike or lockout cannot be called before September 18. But without an agreement, Air Canada will begin canceling flights on Sunday. And after that, it will take four to five days to get back to normal. A beautiful shambles in perspective.
110,000
Number of travelers flying with Air Canada and Air Canada Rouge daily
Source: Air Canada
Yet Air Canada is offering its pilots a 30% pay increase (20% immediately, 10% over three years). This would translate into an increase of more than $100,000 for the captain of a large carrier, with more than 10 years of experience, who already earns $350,000 per year.
Wow! That would take him up to $450,000. Almost half a million a year, for 12 days of work per month. That’s more than Quebec doctors who have a gross salary of $383,000 for a general practitioner and $417,000 for a specialist (in full-time equivalent).
$215,075 to $351,958
Salary in 2023 for an Air Canada captain for a large aircraft, depending on the type of aircraft. A young pilot earns about $60,000 in his first year.
Source: Air Canada
Young people, forget about college. Become an airplane pilot!
Pilots want the best of both worlds: the benefits of the free market and the comfort of a monopoly.
By demanding similar salary conditions to those of American pilots who earn up to US$500,000 (CAN$680,000), they would like the competition game to apply without borders. It’s a bit like if the owner of a four-and-a-half in Montreal demanded the same rent as an apartment in New York. It doesn’t work like that!
0.05%
Turnover rate of Air Canada pilots who have left to work in the United States, around twenty in total, over the past nine years
Source: Air Canada
Moreover, the pilots are very happy that the government comes to the rescue of Air Canada every time it is on the verge of bankruptcy. This has saved the employees’ pension plan, which was heavily in deficit. Meanwhile, workers at other companies that have gone under (Nortel Networks, Sears Canada) have seen their pensions cut for life.
But Air Canada also wants the best of both worlds.
When things are going well, the company makes money like water. In the 2010s, it had recorded practically the best performance of the entire Canadian stock market, with a gain of 3900% over 10 years. All this to the great delight of the bosses who pocketed a remuneration to match.
But when things go sour, Air Canada doesn’t hesitate to call the government for help, knowing that Canada can ill afford to see its dominant carrier in trouble.
This week, Air Canada also asked Ottawa to impose binding arbitration, under section 107 of the Canada Labour Code., even before the strike began. However, it is a weapon of last resort that cannot be used without political and legal risks.
Last month, the government used it to end the otherwise economically disastrous rail dispute. Soon after, the New Democrats tore up the deal that kept the minority Liberal government in power. And the union is challenging the decision because governments no longer have the right to prevent workers from striking, following a 2015 Supreme Court ruling.
It is therefore not surprising that Prime Minister Justin Trudeau refuses to come to the aid of Air Canada for now.
But Ottawa must use all its powers of persuasion to convince the parties to agree. It is its role to fight on behalf of the travellers who will bear the brunt of the conflict.
$1.4 billion
That’s what a two-week strike at Air Canada would cost the Canadian economy, or $98 million per day.
Source: Desjardins Movement
In the event of a cancellation, the lucky ones will find a flight on the wings of another carrier. The others will be reimbursed by Air Canada… but without any other form of compensation. Thus, passengers who have already paid for a cruise, a hotel or a car risk losing their money, unless they have insurance.
It’s enough to make you see red.
Even in normal times, passengers have to bend over backwards to assert their rights under the Air Passenger Protection Regulations adopted by Ottawa in 2019. Since these regulations are full of loopholes, carriers are shirking their responsibilities. This is why the number of complaints to the Canadian Transportation Agency (CTA) has increased fivefold since 2018-2019. The organization finds itself with more than 78,000 files stuck in its crosshairs. Be patient, it will take years to get through the pile.
And we still wonder when the improvements to this damn regulation, announced by Ottawa in 2023, will come into force.
In the meantime, frustrated travelers have only one message for Air Canada pilots and executives: for heaven’s sake, listen to each other!