News: Air Canada to cut about 20,000 jobs amid COVID-19 crisis

Employee Relations

Air Canada to cut about 20,000 jobs amid COVID-19 crisis

The downsizing will reduce the airline’s workforce by 50 percent to 60 percent. Furter, to minimize the number of layoffs, Air Canada will ask flight attendants to slash their schedules, go on leave for up to two years or resign with travel privileges.
Air Canada to cut about 20,000 jobs amid COVID-19 crisis

Canada’s biggest airline had earlier predicted a large reduction in staff numbers as it expected the impact of the coronavirus pandemic to last at least three years. Now as per the latest news, about 22,800 workers may lose their jobs effective June 7.

The country's largest airline — along with its competitors — has been struggling because of the ongoing border shutdowns and confinement measures, prompting Air Canada to ground some 225 airplanes and slash flight capacity by 95 percent.

The airline made a similar decision in March to let go of nearly half of its workforce under a cost reduction scheme, only to rehire some 16,500 laid-off flight attendants, mechanics and customer service agents in April under the Canada Emergency Wage Subsidy — a program it has not committed to participate in past June 6.

These are tough times for all and companies are trying to explore many other options to minimize layoffs but the airlines and the hospitality sector have been hit the most.

Minimizing layoffs and its impact

To minimize the number of layoffs, Air Canada will ask flight attendants to slash their schedules, go on leave for up to two years or resign with travel privileges.

A bulletin signed by the president of CUPE's Air Canada component and two other union officials read, "The reality is that COVID-19 has severely impacted the demand for air travel over the past few months and into the foreseeable future. As such, there is no denying that we are dealing with the largest surplus of cabin personnel in our history."

The Montreal-based company has been bleeding cash since mid-March and expects even fewer passengers between April and June. Though traffic is expected to pick up somewhat before year's end, Air Canada CEO Calin Rovinescu said last week the recovery will be slow, with at least three years of subpar earnings.

Canadian Prime Minister Justin Trudeau said on Saturday he would look at possible ways to help airlines further, but has not laid out any new measures yet. How far can government support the airlines and minimize such mass layoffs due to the coronavirus pandemic remains unknown. 

Image Credits: FlightGlobal

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Topics: Employee Relations

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