Air Canada, union reach tentative deal

Air Canada's striking customer service and sales staff should be back on the job Friday after reaching a tentative collective agreement with the airline.

New-hire pension issue to go to arbitration

Air Canada's striking customer service and sales staff should be back on the job Friday after reaching a tentative collective agreement with the airline.

The tentative four-year deal between the airline and the Canadian Auto Workers union, which represents the 3,800 striking workers, came on the third day of the walkout.

The strike created some slowdowns and delays for travellers, but no major upheavals.

CAW union president Ken Lewenza said the deal includes wage increases, addresses quality of life issues and retains a defined-benefit pension plan for current workers.

Lewenza said there would be "very slight modifications" to the existing pension plan, but he noted that none of those modifications will go into effect until 2013.

However, Lewenza said the issue of what type of pensions new hires will receive — which had been a sticking point in negotiations — will go to arbitration.

Canadian Auto Workers union president Ken Lewenza said the deal includes wage increases and workplace changes aimed at improving quality of life. ((Aaron Vincent Elkaim/Canadian Press))

"I want to begin by saying sincerely to future workers at Air Canada, we regret that we were not able to put in our collective agreement your desire to have a defined benefit plan," Lewenza said Thursday.

"We have agreed to send that issue to arbitration."

Air Canada wanted new hires to be included in a defined-contribution plan instead of the defined-benefit plan that current employees have, because that would potentially save the airline money.

The workers still have to ratify the deal. Lewenza initially suggested the ratification vote could happen within four or five days, but a statement from the union suggested the vote would take place in the next two weeks.

Striking workers should be back on the job Friday, the union president said.

Airline 'very pleased'

Air Canada chief operating officer Duncan Dee said the airline was "very pleased" to have reached a tentative agreement with the CAW.

"The agreement will help ensure the long-term sustainability of Air Canada while maintaining industry-leading compensation and benefits for our employees," he said in a statement.

News of the tentative deal came shortly after the government tabled back-to-work legislation.

Labour Minister Lisa Raitt said she was pleased with the way the process unfolded and offered congratulations to CAW and Air Canada for "putting the public interest first."

"I know that putting the legislation on the order paper and following through in process today was a tool that was needed in order to focus the parties and narrow the issues and get them to where they are," Raitt said. 

Lewenza, however, reiterated his criticism of the legislation at a news conference Thursday, saying there "should not have been any intervention by government."

"We believe we could have gotten an agreement — maybe even quicker than today — without the intervention of government. Because we were awfully close prior to the government introducing legislation."

With files from The Canadian Press