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An Air Canada jet lands the airport in Halifax on Friday, June 10, 2011. The union representing Air Canada's flight attendants says an arbitrator has issued a decision that establishes a new collective agreement with the Montreal-based carrier. (Andrew Vaughan/The Canadian Press/Andrew Vaughan/The Canadian Press)
An Air Canada jet lands the airport in Halifax on Friday, June 10, 2011. The union representing Air Canada's flight attendants says an arbitrator has issued a decision that establishes a new collective agreement with the Montreal-based carrier. (Andrew Vaughan/The Canadian Press/Andrew Vaughan/The Canadian Press)

Air Canada union calls arbitrator ruling 'profoundly disappointing' Add to ...

A federal arbitrator has ruled in favour of Air Canada management, imposing a tentative agreement that flight attendants rejected last month.

The main sticking points included wages, working conditions and employees’ anxiety over a proposal to start a low-cost carrier that would introduce a reduced pay scale for new hires.

The airline and the Canadian Union of Public Employees had hammered out a proposed contract, but flight attendants turned down the deal. “I am unable to find that any extraordinary circumstances exist to justify further improvements” for union members, Elizabeth MacPherson wrote in her decision.

CUPE complained about management’s withdrawal of voluntary retirement packages previously offered and plans to charge more money for employees travelling on flight passes.

But the arbitrator disagreed with CUPE’s request for better wage increases than envisaged in the proposed contract. She also rejected the union’s efforts to restore the voluntary separation packages, reinstate certain travel discounts for commuting staff and set aside seats to prevent flight attendants from having to eat meals next to the washroom in Embraer jets.

“I see no justification for awarding the union a better result in these areas than it was able to negotiate,” she said.

Ms. MacPherson supported the tentative agreement’s call for wage hikes of 9.3 per cent compounded over the four-year contract – 2 per cent in each of the first three years and 3 per cent in the final year.

“Flight attendants deserve better than this decision,” CUPE national president Paul Moist said in a statement Monday.

Mr. Moist described the ruling by Ms. MacPherson as “profoundly disappointing.”

He blamed federal Labour Minister Lisa Raitt for intervening in the contract dispute.

“This government has been extremely irresponsible, and it’s their constant interference in collective bargaining that tipped the scales in favour of the company and against hard-working flight attendants,” Mr. Moist said.

In August and again in October, flight attendants turned down tentative agreements that were recommended by their own union leaders.

Last month, CUPE cancelled plans for 6,800 flight attendants to walk off the job, just hours before the strike deadline, because Ms. Raitt referred the dispute to the Canada Industrial Relations Board – a move that rendered the proposed job action illegal. The Labour Minister also had indicated she was prepared to introduced back-to-work legislation.

Ms. MacPherson serves as the CIRB’s chairwoman.

“Awarding flight attendants an agreement they rejected a month ago does not in any way address serious workplace issues and flight attendants are rightfully disappointed and angry,” Mr. Moist said. “If Air Canada is truly interested in running a professional and efficient company they must invest in their work force. This agreement will leave flight attendants exhausted, frustrated and underpaid.”

Air Canada has said that its flight attendants enjoy industry-leading compensation packages.

On Monday, the Montreal-based airline welcomed the arbitrator’s ruling. “Air Canada is pleased with this final and binding decision to implement the terms of the second tentative agreement that was reached with CUPE’s democratically elected leadership in September,” Air Canada executive vice-president Duncan Dee said in a statement. “The implementation of a new collective agreement with our flight attendants ends a period of uncertainty for our customers and will allow Air Canada and its employees to move forward together.”

The arbitrator noted that voter turnout for the second tentative pact slid to 73.2 per cent, compared with 78.6 per cent for the first proposed contract. “It is fair to conclude that they were not so unhappy with [the second deal]that they felt compelled to vote against it,” she said.

Of those who cast ballots, 87.8 per cent spurned the first deal and 65.2 per cent rejected the second.

Ms. MacPherson said Air Canada made “significant improvements” in the second pact, notably higher hikes to meal allowances, the withdrawal of a letter of understanding outlining reduced wages at the low-cost carrier and the introduction of a new pension system for new hires.

She also said the union managed to secure improved work rules for “continuous duty days.” In the collective agreement signed between union negotiators and management on Sept. 20, a new system for calculating “paid time” boosts the payable hours during stopovers. For example, some shifts that factor in layovers last 13 hours and currently pay out 6.5 hours of wages. But it will be raised to nine hours of wages, effective Oct. 1, 2012, based on the formula dubbed “duty day minus four hours.”

New flight attendants are now slated to go into hybrid plans that blend defined benefit and less costly defined contribution pensions – modelled after a system devised by the Canadian Auto Workers union, which won an arbitration case affecting new Air Canada sales and service agents.

“An objective comparison of the two tentative agreements reveals that the union bargaining committee did a superb job of extracting additional concessions from Air Canada during the bargaining that took place following the rejection” of the first deal, Ms. MacPherson said. “While the parties may have been bargaining under the threat of government intervention, the usual economic pressures present in every set of airline negotiations were also operating.”

The previous CUPE contract expired March 31.

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