Bloomberg News

Air Canada Attendant Strike Barred as Labor Board Takes Case

October 12, 2011

(Updates with union response in fourth paragraph.)

Oct. 12 (Bloomberg) -- Air Canada flight attendants were barred from striking tonight after the government sent their contract dispute with the nation’s biggest carrier to a federal labor tribunal.

Canadian law suspends the right to strike while health and safety aspects of a proposed job action are under review by regulators, the Industrial Relations Board said today in a statement. Air Canada had no immediate comment, said a spokeswoman, Isabelle Arthur.

The federal panel received two referrals from Labor Minister Lisa Raitt seeking an examination of a walkout on public health and safety grounds and on whether the attendants union had created unfavorable settlement conditions by rejecting two contract offers.

“The minister’s intervention with the Labor Board, as it stands, postpones the calling of a strike until the question of essential services has been ruled on,” the Air Canada Component of the Canadian Union of Public Employees said in a statement.

Raitt sent the matter to the labor tribunal after promising earlier this week to ask the House of Commons for back-to-work legislation to bar a walkout. Lawmakers aren’t scheduled to return until Oct. 17, and attendants had planned to strike at 12:01 a.m. tomorrow.

‘On Hold’

Referring the case to the Industrial Relations Board “puts it on hold until Parliament is back, and then in a normal course of events they can have back-to-work legislation,” said Karl Moore, a professor of business at McGill University in Montreal who specializes in the airline industry.

Union leaders could have faced fines and legal ramifications if they had ignored the board’s mandate, according to employment lawyer Davies Bagambiire, of Davies Bagambiire & Associates in Toronto.

“The order could be converted into a court order for enforcement and there could be financial penalties,” Bagambiire said in a telephone interview. “The first stage would be down the road to have the leadership heavily penalized financially for disobeying an otherwise lawful order.”

All Air Canada flights are continuing to operate as scheduled, the carrier said in a statement on its website.

Air Canada rose less than 1 percent to C$1.39 in Toronto. The shares have tumbled 60 percent this year, compared with a 11 percent slide in the benchmark S&P/Toronto Stock Exchange Composite Index.

Attendants turned down two previous tentative contracts agreed to in bargaining between union leaders and Air Canada.

Raitt had also threatened back-to-work legislation when attendants came within hours of a strike in September, and the government advanced such a measure in June just as Air Canada service workers agreed to return to the job after a walkout.

--Editors: Ed Dufner, James Langford

To contact the reporter on this story: Heather Perlberg in New York at hperlberg@bloomberg.net

To contact the editor responsible for this story: Ed Dufner at edufner@bloomberg.net


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