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Thu, Jan 23, 2003

Oh, Air Canada

Layoffs Announced; Layoffs Yet to Come?

Last week, Air Canada, faced with lower revenues and bleak forecasts, gave notice to 300 ramp and cargo workers, that, effective the end of this month, they would be free to look for employment elsewhere.

Air Canada says the cuts are temporary, and will represent a three- to twelve-month no-payday period for those affected. The airline denied that these are just the first of the oft-rumored layoffs to encompass perhaps 4000 more. It did, though, say that it is working toward reducing costs -- and that portends reduced hours for those who remain.

The Toronto Star, in a Susan Pigg article early this week, says that Air Canada pilots, who are allowed to work 78 hours a month, are currently flying 73, 74 hours; and retiring pilots aren't being replaced.

Air Canada may also initiate formal talks with its unions, to try to convince union leadership that the airline is in trouble, and to see if the unions will volunteer to help out, a la UAL and AMR.

Capt. Don Johnson, president of the Air Canada Pilots Association, was quoted in the Star as saying, "I equate it to what's happening at American Airlines, where Don Carty is saying: `You can come and talk to us and maybe have some input into the way things go here in the next six months, or we can go into (bankruptcy) protection and someone who doesn't even know the airline industry will decide what kind of pay cut you take. ...I think those are the kinds of discussions that we would be looking at."

In the meantime, Air Canada's regional airline, Jazz, is cutting routes, steadily downsizing its service. A recent move, eliminating the flights between St John's, Newfoundland, and Labrador, has drawn particular ire. The mayor of Labrador's largest town, John Hickey, was widely quoted after the discontinuance of that route, saying, "We feel betrayed. As far as I'm concerned, to hell with Air Canada."

Residents, whose infrequent trips cannot support regular service, are starting to look to the government to force the carriers to provide it. That puts a double strain on lawmakers: on the one hand, most of the constituents don't want to have to subsidize air travel for Labrador and Newfoundland residents; on the other hand, the government doesn't want to appear 'heartless,' effectively stranding those would-be travelers, until the prices rise enough to justify continuation of service. The airlines don't want to appear unreasonable, and actually charge what those routes cost -- if not enough people are using them now, it's easy to see that even fewer would pay more...

Many, unaware of the economics involved, feel as Mayor Hickey" "...we in Labrador got screwed."

FMI: www.aircanada.ca/e-home.html; www.aircanadajazz.ca

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