Union to vote again on Air Canada contract deal

Mon Jul 6, 2009 1:49pm EDT
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By Nicole Mordant

VANCOUVER, British Columbia (Reuters) - Members of Air Canada's biggest labor union, who rejected a tentative contract agreement with the carrier last week, will vote again on the offer on July 14 after the two sides talked over the weekend, a union spokesman said on Monday.

Air Canada, the country's biggest airline, said in a statement that it and the negotiating team from the International Association of Machinists and Aerospace Workers (IAMAW) had "agreed on the clarification of certain issues" in talks this past weekend. The two sides also agreed on a "prompt revote on the original agreements".

The union's negotiating committee and Air Canada reached a tentative 21-month agreement on June 8 on a new labor agreement, as well as a deal that will allow the cash-strapped airline to temporarily halt funding its C$2.9 billion ($2.5 billion) pension deficit.

But members of the 12,300-strong IAMAW narrowly rejected the agreements in a vote last week, a surprising outcome and a troubling one for the debt-laden airline.

Union support is critical for Air Canada to gain federal approval for a temporary freeze on pension funding and C$600 million in short-term loans.

Without a pension moratorium and the new financing, analysts say the carrier could be headed for its second bankruptcy filing in six years.

IAMAW spokesman Bill Trbovich said on Monday that union members across Canada will vote again on July 14, with results likely announced the same day.

The union said on its website that Air Canada, in a series of letters of intent and clarification, had at the weekend addressed member concerns on outsourcing, labor relations, pension matters and job stability at Aveos Fleet Performance, a sister company to Air Canada.   Continued...

<p>Air Canada planes sit on the tarmac at Pearson International Airport in Toronto, June 17, 2008. REUTERS/Mike Cassese</p>