Montreal, June 02: Bankrupt Air Canada has reached a cost-cutting agreement with its 3,150 pilots, providing a way forward for the company, the group has announced in a statement. "With this agreement Air Canada has now reached its overall labour cost reduction target," it said.
A judge on Friday had given the company and its pilots union until midnight Saturday to reach an agreement, or have the dispute settled in court.
But as a result of the last-minute deal a hearing before the Ontario Superior Court of Justice will not take place, the company said yesterday. The judge has given Air Canada and its unions until tomorrow to finalize their agreements, which are to be submitted for ratification by June 30 at the latest.
According to the pilots, Air Canada will now allow its regional carrier, Jazz, to play a more prominent role in operations. "We are now ready to set up this new low-cost carrier from coast to coast," Nick Di Cintio, Pilots' Association president for the Jazz Airline.
Preliminary agreements made earlier in the week with other unions allow Air Canada to cut 560.27 million US dollars from its salary pool.
The agreements include another 87.65 million US dollars in savings from non-union and executive personnel, as well as in other aspects of restructuring of the airline equivalent to 80.34 US dollars, the group said. Bureau Report