Canada's WestJet expects first pilots' labor contract after 2018

FILE PHOTO - President and Chief Executive Officer of Westjet Airlines Gregg Saretsky addresses shareholders during the company's annual general meeting in Calgary, Alberta, May 7, 2013. REUTERS/Todd Korol

MONTREAL (Reuters) - The chief executive of Canada’s WestJet Airlines said on Tuesday that negotiations to reach a first labor contract with pilots, which began this year, will be protracted and he does not expect a deal next year.

“It’s going to take a long time,” CEO Gregg Saretsky told a Toronto transportation conference. “It is unlikely that there will be an agreement in 2018.”

Pilots from WestJet’s mainline and regional affiliate recently agreed to join the Air Line Pilots Association (ALPA) and separate unions are trying to organize the carrier’s other employees, including flight attendants.

Calgary-headquartered WestJet, Canada’s second-largest airline, had previously been the last carrier in North America with non-unionized pilots, Saretsky said.

“There’s a certain inevitability,” he said of the pilots joining ALPA.

The union campaigns at WestJet have raised some concerns among analysts about the prospect of higher labor costs at a time when the company is launching ultra-low-cost carrier Swoop, which is expected to start flights in June 2018.

Saretsky said he expected the first pilot contract to be “cost-neutral,” in terms of salaries and benefits, adding, “I’m not expecting there to be any sizeable impact ... because we were paying our pilots very well.”

Reporting By Allison Lampert; Editing by Bernadette Baum and Frances Kerry