Last week, an arbitrator’s decision brought the long-simmering labour dispute between Air Canada and its flight attendants to an unceremonious end.
Arbitrator Paula Knopf’s award will determine Air Canada flight attendants’ wage increases over the four years of the now-settled contract. This decision will impact roughly 15,000 workers represented by the Canadian Union of Public Employees (CUPE) at Air Canada and Air Canada Rouge.
While CUPE flight attendants will finally receive pay increases after striking Air Canada and courageously defying a government-imposed back-to-work order last August, the award falls short of members’ demands.
According to the terms of the arbitration award, Air Canada workers will see a relatively large initial increase of 8 or 12 per cent in the first year of the new collective agreement (depending on seniority), followed by 3 per cent, 2.5 per cent, and 2.75 per cent over the next three years, respectively. Importantly, flight attendants at Air Canada Rouge will receive a bigger first year bump to equalize their pay with workers at the main airline.
The union, by contrast, sought a “market adjustment” of $10.76 per hour to all base rates in the first year of the contract, followed by 3 per cent in each subsequent year. CUPE also requested the inclusion of a new cost-of-living allowance (COLA) to better protect workers from unexpected bouts of high inflation, which the arbitrator dismissed.
As CUPE’s Air Canada Component said in its press release announcing the arbitrated award, “This is not the outcome the Union fought to achieve.”
Indeed, when flight attendants mobilized one of the strongest strike mandate votes in Canadian history, they demonstrated their intention to make up for lost ground. Following a series of lacklustre contracts, including the previous 10-year deal that capped wages at 2 per cent annually, workers had drawn a line in the sand during this latest bargaining round. Air Canada plainly had other ideas.
As the strike deadline loomed, the company showed little urgency in bargaining. When workers set up picket lines last August 16, Air Canada appeared content to wait for government intervention.
The Liberals, at that point still enamoured with their unique interpretation of section 107 of the Canada Labour Code (i.e., that the government could unilaterally end any strike it deemed inconvenient), obliged within hours and instructed the Canada Industrial Relations Board to put an end to the strike.
As Air Canada’s CEO admitted in a BNN Bloomberg interview, the company made no contingency plans for a strike, assuming the government would “enforce section 107” and return flight attendants back to the job.
Neither Air Canada nor the government anticipated workers’ resolve. Flight attendants, backed by CUPE’s national leadership, refused to back down and continued their strike ‘illegally.’ Within hours, the company was back at the bargaining table, with the terms of a settlement hammered out in short order.
The outcome, however, was no standard tentative agreement. Rather than a set of proposals on which union members could freely vote, all but the proposed wage increases were locked in.
CUPE managed to secure important gains, such as ending unpaid ground work through new “premium pay” rules guaranteeing partial compensation and a plan to increase ground pay rates over the life of the contract. But to both protect these gains and shield the union from the looming legal consequences of continuing an ‘illegal’ strike, CUPE representatives agreed to circumscribe union democracy.
The settlement was a deal made under duress.
Then, in another act of resistance, more than 99 per cent of members rejected the Air Canada wage offer. Because a ‘no’ vote meant sending only the wage proposal to arbitration, while leaving the remainder of the terms of settlement in place, there was effectively no downside to rejection. Since an arbitrator wouldn’t reduce pay rates below the August offer, gambling on arbitration seemed the only rational choice.
Moreover, it’s not unreasonable to assume that the union didn’t intend for the wage settlement to pass in the September membership vote. As the arbitration decision points out, union representatives never recommended that members vote ‘yes’ on the company’s wage offer, as is common when workers vote on tentative agreements. Having secured other meaningful improvements, particularly related to ground pay, the union may have bargained on a strong ‘no’ vote and a potentially favourable arbitrated outcome.
The first assumption proved correct; the second did not. Members registered their overwhelming displeasure with the wage proposal, but this had no impact in arbitration.
As arbitrator Knopf wrote: “The Cabin Personnels’ virtually unanimous rejection of the wage offer indicated their deep dissatisfaction. However, their failure to ratify does not automatically trigger a changed or enhanced result in an interest arbitration process,” adding that “although the Cabin Personnel’s’ 99.1 per cent rejection of the wage offer is impossible to ignore, it cannot and has not factored into the outcome of this case.”
Instead, Knopf upheld the wage increases that CUPE agreed to put before members to end the ‘illegal’ strike. She noted that Air Canada flight attendants remain the best compensated in the sector and considered other “breakthrough” gains, such as pay for groundwork, to weigh against awarding higher pay increases.
This is not terribly surprising. Arbitration is an inherently conservative process, guided by the principle of gradualism wherein arbitrators seek to replicate what free collective bargaining would likely have produced, and are therefore reluctant to impose significant changes to pay or working conditions.
Of course, this particular arbitration followed heavy-handed, and likely illegal, government intervention that attempted to end CUPE’s strike. It’s difficult to envisage how an arbitrator could reproduce the hypothetical outcome of successful bargaining under such circumstances.
In fact, CUPE argued during arbitration that the terms of the wage settlement should be set aside precisely because the government’s use of section 107 prevented free collective bargaining. Knopf instead found that the union’s continued strike action encouraged Air Canada to increase its offer, thus demonstrating that bargaining continued despite the “‘extraordinary circumstances.’”
While we may criticize the union’s decision to accept the terms of the August settlement and gamble on arbitration, fault for this disappointing outcome lies squarely with the federal government.
It was Minister of Jobs and Families Patty Hajdu who trampled on flight attendants’ right to strike and forced the union into a situation wherein trading away a democratic ratification process seemed the best of a series of bad options. Moreover, it was the Liberals’ year-long love affair with section 107 that signalled to Air Canada that the company needn’t take the bargaining process seriously because a government back-to-work bailout would nullify the threat of a strike.
CUPE flight attendants had their wages set through an undemocratic arbitration process because the federal government chose protecting corporate power over workers’ right to free collective bargaining.
No union or worker should ever forget that.
Recent Class Struggle Issues
- February 16 | The Time Has Come For Sectoral Bargaining
- February 9 | Top-Paid CEOs Made More In 33 Hours Than Workers Will In 2026
- February 2 | Carney’s Job Cuts Undermine Canada’s Position Against Trump
- January 26 | Avi Lewis’s NDP Labour Plan Is A Remarkable Document
