Air Canada unions join up in pension fight

The Globe and Mail

Air Canada’s unions are banding together to fight the airline’s plans for pension reform.

After surviving a decade of concessions, employees are overdue to reap some rewards in the form of higher wages and improved work rules, says Jeff Taylor, president of the Air Canada component of Canadian Union of Public Employees, which represents nearly 6,800 flight attendants.

CUPE, which began contract talks on April 6 with management, is in solidarity with other unions in opposing Air Canada’s proposal to place new hires on defined-contribution pension plans, which don’t provide a guaranteed level of payout upon retirement.

Pension reform “was not supposed to come to the bargaining table, but it did surface,” Mr. Taylor said Thursday, after delivering a speech to 750 delegates at CUPE’s Ontario convention.

On the pension file, CUPE is collaborating with the Air Canada Pilots Association, the Canadian Auto Workers and the International Association of Machinists and Aerospace Workers.

Labour leaders are developing their own ideas for pension relief, but creating defined-contribution plans for new hires would be too drastic, Mr. Taylor said. In mid-2009, unions agreed to management’s request to suspend company contributions to pension plans until early 2011, but Air Canada argues that its pensions have yet to return to financial health, sporting a $2.1-billion solvency deficit.

CUPE is willing to look at other proposals, notably management’s pitch to make it tougher to qualify for early retirement – staff in existing defined-benefit pension plans would face having to work an extra five years to reach 30 years of service.

Mr. Taylor also said CUPE is open to further discussions on Air Canada’s plans to launch a low-cost carrier next winter. Management wants flight attendants at the low-cost carrier to be classified on a lower-wage scale and follow different work rules than the mainline service.

Pilots have rejected a tentative agreement that called lower wages at the proposed discount leisure division and revamped pension rules.

“All the unions at Air Canada haven’t really had major gains in contracts or salaries in over 10 years. It’s time for us to get our fair share,” Mr. Taylor said.

Air Canada declined comment.

Under the four-year contract rejected by pilots, they would have been entitled to across-the-board increases of 5 per cent in the first year, then annual wage hikes of 3 per cent, 2 per cent and 2 per cent.

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