Layoffs at Air CanadaAfter two months of uncertainty and instability, Air Canada on May 15 announced massive layoffs of up to 60 per cent of its workforce -- as many as 20,000 employees. With the spread of COVID-19, airline travel was one of the sectors of the economy that was affected quickly and seriously. Passenger traffic to various destinations dropped off immediately, followed by countries closing their borders to international flights. It has reached the point that airlines in Canada are declaring that they are operating at five per cent of the capacity they had last year. This, along with the cancellation of a multitude of flights, has led to increasing insecurity among airline workers in all departments. In March, Air Canada already laid off 16,500 flight attendants, mechanics and customer service agents who they rehired in April under the federal government's Canada Emergency Wage Supplement (CEWS), with the government paying 75 per cent of the wages to a maximum of $847 per week, which would apply only for those at the top of the wage scale having worked the maximum hours. New hires and those lower down on the wage scale were already having a difficult time making ends meet with 100 per cent of their wages when they were working full time. Companies are "free" to top up the CEWS, yet despite it being called a supplement, the companies have all declared that they cannot afford to pay the other 25 per cent. And while this program has now been extended to August 29, so far Air Canada appears to have decided that it will not continue with the program beyond June 6. Regarding upcoming flights, not only has Air Canada not yet informed workers of its flight schedule for June, but it has not made any definitive announcement as to what, if any, mitigation measures it will put in place over and above the fundamentals in the collective agreement. For In-Flight Service, these include a "Resignation Program" with continuing, but lower priority travel privileges; a Special Leave of Absence Program, with no loss of seniority or accumulated service for retirement considerations, and with leaves being offered for six, 12, 18 and 24 month periods; and a Reduced Flying Program, allowing flight attendants to work approximately half the standard number of hours, while maintaining their benefits but having to contribute to top up pension contributions and the insurance plan covering loss of wages in case of long-term disability.
The unions representing the workers in the various departments have been reaching out to the company with suggestions for reducing the numbers of layoffs -- including continued participation in CEWS until it expires -- but it is clear that the company is determined to maintain the old way of doing things, namely, finding a way for the major shareholders to continue making a profit rather than attending to the well-being of those who create the wealth. While admitting publicly that the CEWS does not represent a large sum of money, the company chose to abandon the program in order not to have to contribute to the pensions, insurance and other marginal benefits that were its responsibility under the CEWS. This situation has affected workers at all of Canada's airlines. Sunwing and Air Transat have suspended operations, except for a handful of management employees on the CEWS. WestJet, which was recently bought by ONEX, also announced massive workforce reductions in April, over and above those it had announced in March. WestJet has extended the CEWS program until August but is currently down to only 35 flight attendants. It is well-known that the airlines are working together, lobbying the federal government for some sort of "bailout." There is intense speculation that this declaration by Air Canada to lay off more than half its work force, despite the federal assistance program, is an effort to "up the ante" and increase pressure on the federal government.
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The Air Canada
Component of the Canadian Union of Public
Employees (CUPE), representing the flight attendants had also
presented the idea of voluntary separation packages, pension
bridging and financial separation incentives along the lines of
what management and the pilots have received. The company advised
that this was not possible, "due to the financial crisis and
liability the company currently has." Oddly this was not an
obstacle when it came to offers made to management to reduce
their numbers.
This situation is
creating insecurity and anxiety among the
employees as to their future. Without being given the numbers of
employees who will actually be needed, nor without numbers for
those who will take advantage of any mitigation programs being
offered, thousands are actually left wondering about the
challenges they will be facing in the coming weeks, months and
years. Of course, this has been the fate of airline workers for
decades because of the boom and bust cycles of the unplanned
economy over which we have no control. Nothing has ever been done
to ensure that workers can weather the storms. This must change.
There is no better time than now to demand a new direction for
the economy.