Air Canada Avoids Strike With New Pilot Contract

There’s some good news for Air Canada passengers…

Air Canada pilots get tentative four-year contract

Air Canada and the Air Line Pilots Association (ALPA) have just agreed on a new tentative contract for the 5,200+ pilots at Air Canada and Air Canada Rouge.

As it’s described, the new four-year contract “recognizes the contributions and professionalism of Air Canada’s pilot group, while providing a framework for the future growth of the airline.” The terms of the contract will remain confidential, pending a ratification vote by the membership, which is expected to be completed over the next month. The contract will also need to be approved by the Air Canada Board of Directors.

For some background, the union and management have been in contentious negotiations for several months now. The situation got especially bad in recent days. Given that negotiations broke down and the government refused to intervene, pilots were about to be able to issue a 72-hour warning on a strike. So Air Canada was preparing to progressively cancel flights over the next three days, and completely shut down operations as of Wednesday, September 18, 2024.

Air Canada had a travel waiver in place, so passengers could rebook to avoid traveling over the potential strike dates. Fortunately Air Canada’s schedule should mostly operate as normal this week, thanks to the strike being avoided.

Why these negotiations were so contentious

Why were contract negotiations so contentious between Air Canada and the union? Well, in recent years, we’ve seen pilots at US airlines get rich new contracts, with massive pay raises. Pilots in the US are now by far the best paid in the world, and those contracts were largely made possible thanks to the pilot shortage we had for a couple of years (which is due to the baseless 1,500-hour rule that we have for pilots).

While we don’t know what exactly the terms of the tentative contract are, we know that Air Canada had been offering pilots wage increases of more than 30%, plus improved pension and health benefits.

Air Canada pilots wanted more, as they saw what their counterparts at US airlines were earning. Based on union data, United Airlines pilots are earning 92% more than Air Canada pilots, while a bit over a decade ago, the gap was just 3%.

The new contract for Air Canada pilots reportedly offers $1.9 billion CAD ($1.4 billion USD) in incremental value over the course of four years, representing a 46% increase over the old contract, which expired in September 2023.

It’s good to see that management and the union were able to meet in the middle. It sounds like management ultimately increased its offer a bit, but the union also made some concessions. It’s nice to see a strike avoided, for once, rather than a tentative agreement only being reached after major damage has been done.

Bottom line

Air Canada management and ALPA have agreed to a tentative contract, avoiding a massive strike in the coming days. The four-year contract offers 46% in incremental value. While it’s not quite the US pay rates that Air Canada pilots were hoping for, it’s still more than the initial 30%+ raises that management was offering.

Kudos to the two sides for coming to an agreement, and hopefully the contract gets ratified.

What do you make of Air Canada pilots getting a new contract?