Wretched Wrench
Veteran
- Apr 21, 2003
- 1,626
- 12
TORONTO, May 18 (Reuters) - Air Canada <AC.TO> will present a final cost-cut offer to the Canadian Auto Workers union on Tuesday morning as the cash-strapped airline tries to salvage a deal that would pull it away from the threat of liquidation.
Ontario Supreme Court Justice Warren Winkler ordered Air Canada, the country's biggest airline, to present a final offer the hold-out union at 8 a.m. (1200 GMT) on Tuesday. The CAW rejected a package late on Monday night that would have helped the insolvent airline secure a financial life-line from Deutsche Bank AG <DBKGn.DE>, which has demanded C$200 million ($143 million) in labor concessions.
So far eight of Air Canada's nine unions have agreed to concessions, with the CAW, which represents 5,900 customer service employees at the airline, the sole holdout.
The union rejected Air Canada's latest proposals on Monday night after a day of bargaining and a late meeting with Winkler.
The union will only have a matter of hours on Tuesday to make a decision on the new package.
CAW head Buzz Hargrove, who is no stranger to last-minute talks, said the airline's demands "are simply too heavy for our members to bear."
Hargrove said concessions demanded by Air Canada amount to nearly a C$10,000 annual wage cut for each worker.
"When the salary range is between C$35,000 and C$49,000, this is asking too much of workers who have already given back to this company C$165 million in concessions last year at this time," Hargrove said in a release.
Air Canada, the world's 11th largest carrier, must get all of its unions to agree to cuts to secure the backing of Deutsche Bank AG <DBKGn.DE> to underwrite a C$850 million rights offering to creditors.
A $1.5 billion loan package from General Electric Aviation Services (nyse: GE - news - people) is also conditional on a final agreement between Air Canada and Deutsche Bank.
The union for Air Canada's 8,000 cabin-crew workers agreed on Monday to new pay cuts, making the CAW the only union that had not yet reached an agreement.
($1=$1.40 Canadian)
Ontario Supreme Court Justice Warren Winkler ordered Air Canada, the country's biggest airline, to present a final offer the hold-out union at 8 a.m. (1200 GMT) on Tuesday. The CAW rejected a package late on Monday night that would have helped the insolvent airline secure a financial life-line from Deutsche Bank AG <DBKGn.DE>, which has demanded C$200 million ($143 million) in labor concessions.
So far eight of Air Canada's nine unions have agreed to concessions, with the CAW, which represents 5,900 customer service employees at the airline, the sole holdout.
The union rejected Air Canada's latest proposals on Monday night after a day of bargaining and a late meeting with Winkler.
The union will only have a matter of hours on Tuesday to make a decision on the new package.
CAW head Buzz Hargrove, who is no stranger to last-minute talks, said the airline's demands "are simply too heavy for our members to bear."
Hargrove said concessions demanded by Air Canada amount to nearly a C$10,000 annual wage cut for each worker.
"When the salary range is between C$35,000 and C$49,000, this is asking too much of workers who have already given back to this company C$165 million in concessions last year at this time," Hargrove said in a release.
Air Canada, the world's 11th largest carrier, must get all of its unions to agree to cuts to secure the backing of Deutsche Bank AG <DBKGn.DE> to underwrite a C$850 million rights offering to creditors.
A $1.5 billion loan package from General Electric Aviation Services (nyse: GE - news - people) is also conditional on a final agreement between Air Canada and Deutsche Bank.
The union for Air Canada's 8,000 cabin-crew workers agreed on Monday to new pay cuts, making the CAW the only union that had not yet reached an agreement.
($1=$1.40 Canadian)
