Air Canada's largest unionised employee group rejected a tentative 21-month pension funding moratorium and contract extension requested by their cash-strapped employer, throwing into question whether the carrier will be able to achieve concessions as it attempts to avoid a second formal restructuring this decade.
The International Association of Machinists and Aerospace Workers (IAMAW) represents three Air Canada employee divisions, and a majority of all three must vote in favour of the tentative pacts to ratify conditional contracts.
While the technical maintenance and operational services division, which includes more than 10,000 Air Canada employees such as mechanics in heavy maintenance and line maintenance, voted against the deal by 50.8%, the proposal garnered some support among IAMAW members.
Some 87.5% of the finance division and 93.2% of the clerical division, which together account for less than 700 Air Canada employees, were in favour of their collective agreements.
So, "the union will have internal discussions this week to determine how best to proceed and intends to meet with Air Canada as early as possible to discuss how matters can move forward to a successful conclusion" an IAMAW spokesman says.
IAMAW represents 12,300 Air Canada technical, maintenance and operational support, clerical and finance employees.
The IAMAW decision bucks a trend that saw Air Canada dispatchers, as well as, customer service and sales agents endorsing the pension deal, which would also require the carrier to make fixed payments after the deferral period between 2011 and 2013.
Meanwhile, decisions are outstanding from members of the Air Canada Pilots Association (ACPA) and the Canadian Union of Public Employees (CUPE), which represents Air Canada flight attendants.
In addition to support from all five unionized employee groups, Air Canada also needs the federal government to adopt an amendment to pension funding rules for the proposed moratoriums to take effect.
Air Canada is required to raise a minimum of C$600 million ($523.5 million) as a condition of the pension moratoriums.
The Star alliance member is attempting to shore-up its liquidity due to the operator having a C$3.2 billion pension deficit as of 1 January, with estimated 2009 contributions ranging between C$150 million and C$410 million.
Source: Air Transport Intelligence news
