Air Canada issues contract ultimatum to pilots

Thu Mar 8, 2012 12:34pm EST
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(Reuters) - There was no response from Air Canada or the union representing its pilots on Thursday after a noon (1700 GMT) deadline had passed for the union to accept the carrier's "best and final" contract offer.

Canada's biggest airline had issued the ultimatum just 23 days into a 180-day federal mediation process.

It also said that "if the association did not accept the offer, it would 'pursue any and all rights afforded to it by law'," according to a union memo to pilots, obtained by Reuters.

The Air Canada Pilots Association is in a legal position to strike, and Air Canada can lock them out, but both must give 72 hours' notice.

The showdown comes are Air Canada already faces a looming strike from its machinists union, which represents 8,600 mechanics, baggage handlers and cargo agents.

The International Association of Machinists and Aerospace Workers has said it will go on strike at one minute after midnight on Sunday night unless a deal on a new labor contract is reached beforehand.

Analysts say that a strike would ground the country's biggest airline at the busy March Break travel season.

The machinists said on Thursday it had called its bargaining committee back to Toronto to be available if talks resume with the carrier.

(Reporting By Susan Taylor, Allison Martell; Editing by Peter Galloway and Rob Wilson)