Air Canada (TSX:AC) escalated its labor dispute with the Canadian Union of Public Employees (CUPE) on Wednesday, issuing a 72-hour lockout notice less than a day after declaring negotiations at an impasse. The airline said the move follows CUPE’s own statutory strike notice and is intended to enable an “orderly suspension” of Air Canada and Air Canada Rouge operations by August 16.
The carrier’s decision comes after eight months of bargaining, which included federal conciliation and an offer to enter binding arbitration, rejected by the union. Air Canada said its latest proposal, tabled August 11, included a 38% total compensation increase over four years, improved pensions and benefits, better crew rest, and sought no concessions in return.
“We regret the impact a disruption will have on our customers, our stakeholders and the communities we serve,” said Michael Rousseau, President and Chief Executive. “However, the disappointing conduct of CUPE’s negotiators and the union’s stated intention to launch a strike puts us in a position where our only responsible course of action is to provide certainty by implementing an orderly suspension of Air Canada’s and Air Canada Rouge’s operations through a lockout.”
In parallel, Air Canada is asking Ottawa to direct binding interest arbitration under section 107 of the Canada Labour Code, citing recent government interventions in rail, port, and airline disputes. “Given this, while we remain available for discussions with CUPE, we have requested government-directed arbitration as we now view it as the only certain avenue to bring closure to bargaining and mitigate the impact on travelers, business and the Canadian economy,” Rousseau added.
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