November 1, 2024 at 4:00 PM
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Brothers and Sisters,
We recognize members are frustrated and angry with the 10-year collective agreement and the inability to address the increased cost of living, subpar wages etc., and that this frustration has led members to look into alternate representation. We also recognize many of our current members were not employed here in 2015 and therefore we would like to make sure everyone is aware of what the membership, your bargaining committee and Unifor were dealing with at the time and how we ended up with a 10-year contract.
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JANUARY 2015
In January 2015, the company issued a communication to employees advising that they had a proposed new capacity purchase agreement (CPA) with Air Canada that extended our current CPA by 5 years to 2025. This was subject to a Pilot ratification on their respective collective agreement. It was mentioned that there was a potential pilot mobility agreement moving Jazz pilots to Air Canada which provided significant reduced costs.
Along with modifications to the CPA fee structure from a cost plus mark up to a fixed fee compensation structure. As well as modernization of the fleet with 23 Q400s to replace 34 Dash8-100 and CRJ-200 a/c. Increasing to larger aircraft would result in a reduction in the Jazz fleet from 122 a/c to 101 a/c by 2020 and down to 86 by 2025, however a much lower loss of total seat capacity. Now some might think this equals out and would have no impact on maintenance, however fewer aircraft and larger aircraft generally means longer flight legs, less turns per day and less overall maintenance due to the lower aircraft numbers.
Then on February 2, 2015 – after the ratification by the Jazz pilot group – the company issued a further communication to employees on the new commercial agreement with Air Canada. It was in this communication that we first learned of Chorus Aviation’s plans to start a new airline to operate our classic Dash 8 aircraft and that there would be two separate capacity purchase agreements (CPA’s). One would be between Jazz and AC and the second between a new, yet to be formed, Chorus subsidiary and Air Canada.
Much like all labour units eventually did, the Pilots signed a memorandum of settlement (MOS) and detailed collective agreement language was to follow. Eventually we located a copy of the MOS and learned more on the details. This was essentially an 11-year contract that saw longer pay scales (20 years) for new pilots and freezes on movement. New pilots were no longer part of a defined benefit pension plan. There were early retirement options for pilots over 50 and a transition agreement to move 625 pilots from Jazz to Air Canada. All of this removed higher paid pilots and allowed the company to bring in new pilots at lower payrates. There was increased flying hours per pilot and the fleet was shrinking as was overall flying. From later discussions with the company, they would see a reduction in overall pilots from 1200 to 1000 over the term, and that by 2021 they expected only be 200 would be left in the defined benefit (DB) pension plan.
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CHANGING LANDSCAPE
After the pilot ratification, the company started dealing with the other unionized labour groups and it was clear they were after concessions and reduced costs.
Our bargaining committee at that time was composed of one member from each main base (YHZ, YYZ, YUL, YYC, YVR) and one Technical 2 member from the overall membership. From those individuals a chairperson was selected. Additionally, a National Unifor representative would be present (which at that time was Unifor’s Director of Transportation), as well as our Local 2002 President and/or Assistant would be present.
The company requested a meeting in April 2015 and while our collective agreement was not open for bargaining until later in the year, the company proposed the option of interest-based bargaining - an approach to reach mutual gains for both the employer and its employees. They informed us that Chorus Aviation was creating another airline, dubbed “Classics Airline” to operate the Dash 8 100/300 aircraft and that they did not consider this our scope work. They advised this was essentially a forced issue by Air Canada, that in order to continue to operate the classic aircraft, along with the revised CPA fee structure, they had to reduce costs. It was the company’s plan to have this in place by the end of the year, and thus if we were unwilling or unable to reach an agreement which scoped in this work as ours then we would ultimately be facing massive employee layoffs. Their agenda was to separate bargaining units – Line, Heavy and Shops would be divided into separate collective agreements. Jazz also intended to reduce overall employee numbers as the fleet shrunk along with removing senior employees and replacing them with new employees who naturally have less vacation and lower wage rates. They also wanted longer pay scales and to remove auto progression to the certifying scales, and of course, a 10-year collective agreement to 2025 to align with the CPA. As you can imagine this message was not very palatable to your Union representatives.
We immediately engaged with our Unifor national team and their legal department to better understand our position on scope work. It was clear the work on the classic aircraft in Jazz was our work, but we needed to better understand the legal side of Chorus Aviation creating a new division/airline and ultimately the likelihood of a successful grievance/CIRB complaint on that topic, along with how long that process could take.
Since some of us had shares in Chorus we had access to the information provided to investors. The company had issued a presentation to investors on the new CPA, and that among other things also clearly indicated it was part of their plan to start a new classics airline to operate the classic Dash 8 aircraft at lower costs.
The Bargaining Committee went to all of the major bases to inform the membership of these developments. We utilized audio visual so members could see this information, and that it was not just the Jazz management bargaining committee saying they were going to start a new low cost regional airline, but that it was the Chorus Aviation executives and board of directors putting this information out to investors. This indicated that this was not a bluff, rather that Chorus had every intention of carrying through with these plans to reduce costs.
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INTERNAL AND EXTERNAL FORCES
Air Canada had also been reducing costs to its mainline operations with the formation of its low-cost carrier, Rouge (founded in 2012). In 2013, Air Canada also began transferring its Embraer E175 aircraft over to Sky Regional Airlines. In December of that year, they also announced that Air Georgian would operate additional routes in Canada and the United States using Air Canada CRJ100/200 aircraft starting in mid-2014.
It was clear from those membership meetings that members wanted us to enter into discussions to learn more. However, members did not want to divide the bargaining unit or have a 10-year contract. Most saw the dangers of separating the members and detriments to future bargaining by limiting power and providing alternate resources should a strike be required in one of the separated units. We subsequently entered into interest-based discussions with the company that were neither precedent setting or would prejudice our position.
While we met for 25 days, in the end we were unable to reach any agreement. The company was standing firm on separating the agreement, a 10-year cost neutral agreement, no bumping of transfers between heavy and line or shops, no auto progression to ACA, no flight passes for new members in heavy, longer scales for new hires, etc. They were threatening to close YYC Shops if they could not get the wanted cost savings. Similarly, the company made it clear to us that without a separation between Line and Heavy, the board of directors had every intention of closing Heavy Maintenance.
We knew based on what had occurred with Air Canada and Aveos that it was possible, and while we could attempt to fight, in the interim, members would be laid off and forced to make decisions on whether to remain on layoff or bump to another base. Then of course at that time with no agreement, Line bases would also be seeing major layoffs with Chorus Aviation’s intention to launch a new regional airline – provisionally named Jive.
With the changes to our fleet size in the CPA, there was a required reduction of approximately 226 full time positions [system-wide] over the term of the agreement. Then overall cost reductions were based on removing senior employees at top rates and benefits and bringing in new hires at lower rates with longer scales, etc. Therefore, on top of a reduction of 226 bodies (overall due to aircraft maintained), the cost-cutting required approximately 325 early retirements and/or voluntary severance packages to be taken over the 10-year term, which we clearly felt was unachievable given our actual age demographics at that time.
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NEGOTIATING UNDER DURESS
Once we were within the labour code guidelines to officially open negotiations, we issued the company with notice to bargain. We also issued them a notice of bargaining in bad-faith based on the continued threats to outsource our work. We also went back to the membership across the country and filled them in on what had occurred during the interest-based discussions. We put out bargaining surveys to get membership feedback and then we submitted our requests to the company. When we got back to the table, we tabled our demands and the company tabled their previous demands. We eventually agreed to a mediator to assist, since we were getting no where, however that mediator had no ability to arbitrate decisions.
As additional background information, in August and May 2015 both the Jazz Flight Attendants and Jazz Dispatchers negotiated agreements to December 31, 2025 (10+ yrs). Both agreements referenced the then new Chorus operations - Classics Airline and Jive. Both saw the continued focus of the company reducing cost with new hires on much longer scales, reduced pensions and a focus on removing senior employees at top rates with voluntary separation packages and bringing in new employees.
During the mediation process it became clear that should we end up in arbitration we would have a 10-year contract forced upon us as this was the pattern the other labour groups at Jazz had set. In the end, we limited the concessions as best we could. We protected the seniority rights of our current members and retained mobility rights. We scoped in the classic work (even if a new company was to be created). We also maintained flight benefits. Wages would increase 2% per year and other benefits were also increased along with a lump sum payment, and 170 voluntary separation packages would be available over 5 years. However, to see cost reductions, the company had to achieve those VSP’s so as to bring new employees in at lower starting rates and longer scales and ratios to limit how many could get to the certifying engineer scale.
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TODAY
As we hope you can understand, these were difficult decisions for the Bargaining Committee and the membership when it came to ratification. We did not want to separate our members into two units, we did not want a 10-year contract, we did not want ratios, and we did not want to affect future new hires.
Times have changed since 2015. Air Georgian and Sky Regional are gone, Jazz is the major regional carrier feeding Air Canada. While our classic fleet and CRJ200 diminished as planned, we gained the E175 fleet which was not planned. This all positively impacted our numbers. However, we all recognize that the concessions placed on new hires needs to be fixed in bargaining, that we need to address compensation for the cost-of-living deficits we are enduring, and that our wages need to increase to reflect the important work we do.
Unifor is committed to achieve those gains and other membership mandates during bargaining and to provide better transparency and communication during the process.
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24-11-01 Jazz-JTS 2015 Bargaining History - Unifor Local 2002 EN
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