June 15, 2011 / 3:03 PM / 6 years ago

Air Canada, union talk; flights delayed again

4 Min Read

<p>Air Canada customer service and sales staff cheer as they picket outside the International airport in Calgary, Alberta, June 14, 2011. The union representing customer service and ticket sales agents at Air Canada Inc have gone on strike after failing to reach a new labour agreement with the country's biggest airline.Todd Korol</p>

VANCOUVER (Reuters) - The union representing striking sales and customer service agents at Air Canada Inc said on Wednesday it is determined to reach a contract agreement with the country's biggest airline before the federal government forces employees back to work.

Talks between negotiators for Air Canada and the Canadian Auto Workers (CAW) were continuing in Toronto on Wednesday, the union said, as flight delays continued at airports around the country on the second day of the strike.

"We don't think that the government should be interfering in the collective bargaining process. We are determined to come to some sort of agreement before that happens," CAW spokeswoman Shannon Devine said.

Air Canada said it hoped its "efforts will result in a negotiated contract through the normal bargaining process", airline spokeswoman Angela Mah said. The only outstanding issue between the two sides was differences on pensions, she said.

Labour Minister Lisa Raitt gave 48-hour notice on Tuesday night of a bill to force the 3,800 striking check-in and call center staff back to work, but she said on Wednesday it could take seven or eight days to pass legislation.

She appeared unaware of a government motion that would enable the bill to be passed in one day.

"We wouldn't anticipate having anything passed before the weekend. At the very least it's about seven or eight days in total," Raitt told reporters, referring to how long such legislation has taken historically.

Jack Layton, leader of the pro-union New Democratic Party, the biggest opposition party in Parliament, told reporters the Conservative government was backing the wrong side in threatening back-to-work legislation.

"It wasn't too long ago that the working folks who made that airline run took huge cutbacks in order to keep that airline afloat, and then we have the CEO walking away with millions and then wanting to take away pensions (the workers) were counting on for their retirement," he said.

Mild Flight Disruptions

There had been no flight cancellations on Wednesday due to the strike although there were delays again, partly as it took other employees longer to get to work because of picket lines, Air Canada's Mah said.

Air Canada has deployed 1,700 of its managers to airports across Canada to take the reins at check-in and ticketing desks, and diverted customer calls to centers in the United States. It has also urged passengers to check in online and avoid checking baggage if possible.

"It sounds like, so far, operations have not been overly disrupted," National Bank Financial analyst Cameron Doerksen said.

Shares of Air Canada were up nearly 5 percent, or 9 Canadian cents, at C$1.98 on Wednesday afternoon on the Toronto Stock Exchange, retracing some of their losses in the days leading up to the strike.

The Montreal-based company is also in contract talks with four other unions, including its pilots, flight attendants and maintenance workers, after agreements expired earlier this year.

Pensions have emerged as a key bone of contention in negotiations. Air Canada wants to do away with its defined benefit pension plan for new hires as it looks for ways to reduce its deep pension deficit. It has also proposed changes to pensions for existing employees that would see some having to work more years for the same benefit.

($1=$0.98 Canadian)

Reporting by Nicole Mordant and Randall Palmer in Ottawa; editing by Rob Wilson and Peter Galloway

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