Air Canada machinists union reaches tentative deal

Fri Feb 10, 2012 12:39pm EST
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TORONTO (Reuters) - The union representing Air Canada's ACa.TO ACb.TO mechanics, baggage handlers and purchasing agents said on Friday it has reached a tentative labor deal with the country's largest airline, though the threat of a pilots strike as early as next week remains.

The International Association of Machinists and Aerospace Workers said the proposed four-year contract provides wage increases, improved benefits and secures a defined benefit pension fund for about 8,500 workers. It did not specify the size of the wage increases.

Contract talks with the airline's biggest union began in late 2011 and were completed with a government conciliator, who joined negotiations on January 9. The previous contract expired March 31, 2011.

Ratification meetings to vote on the deal may be scheduled for the week of February 20, said union spokesman Bill Trbovich.

Bargaining has just begun for the union's 221 finance and 240 clerical workers, he added.

"I think it's a positive sign that at least we have that tentative agreement, but as we've seen from other agreements, tentative does not necessarily mean ratified," said PI Financial airline analyst Chris Murray.

The Air Canada Pilots Association, which is currently holding a strike vote, reached a tentative agreement with Air Canada in March but the pilots rejected the deal, worried about two-tier pensions and the impact of a proposed discount airline.

The pilots union called the strike vote after talks with a government-appointed conciliator and management failed to produce results. After a cooling-off period that ends February 14, the pilots can strike after giving the airline 72 hours' notice. Air Canada can also lock out workers with the same notice.

Air Canada, which reported a bigger than expected quarterly loss on Thursday, said it is prepared to extend talks with the pilots beyond the February 14 deadline and has told the union it will not impose a contract in the near term.   Continued...