Research Paper Sample on Air Canada and Their Employment Policy

Question 1: Proportion of the Blame

Both the top management of Air Canada and the labor unions, such as the Air Canada Pilots Association (ACPA) are culpable of the difficulties the company faces. The company and the ACPA did not take the initiative to solve the poor labor relation that lasted for over a decade. The conflict between the two parties, the ACPA and Air Canada became public in 2003, which was caused by Air Canada losing money on an everyday basis at a rate of 5 million dollars. Mainly, both parties can be blamed for the labor relations feud. Air Canada can be blamed for the poor labor relations with its pilots mainly because it implemented drastic changes to the existing employment agreement without duly taking into consideration of the workers' opinion on such an action.

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Air Canada never implemented the change positively. It should be noted that organizational change should be all-encompassing, implying that a company cannot perform changes unilaterally without involving the parties. Besides, employees are averse to change, and thus, Air Canada should have taken time to implement the change. Even though Air Canada was losing money at a high rate, laying off large numbers of the staff at one instance was not a good move since this would be seen as hostile towards the staff and would undoubtedly receive a backlash from employee unions, such as the ACPA. Also, the company reduced the employee benefits and increased the number of working hours. Reducing benefits and extending the working hours meant that the collective bargaining and employee contract agreements signed by the pilots would be violated. Violation of the terms of employment by Air Canada was against the Canadian labor law, and thus, this is why the ACPA took the company to court. Even if the company needed to fire employees, at least it should have followed the due process of employee termination. The employees were not underperforming meaning that they were not the problem, but the company went ahead and fired them. Also, Robert Milton, the CEO of the company at the time, as union leaders purported, "put a gun on their heads" by telling them that they needed to surrender their contract rights or Air Canada would be put under bankruptcy protection. Therefore, this highlights that the company was involving threats in firing the pilots, which is against positive labor relations (Association of Corporate Counsel & Osler, 2009). Further threats were issued in April 2012 when the company threatened to fire the president of the pilots' union in a live interview with CBC, which only painted a negative image of the company.

On the other hand, the ACPA was also to blame. As Robert Milton, who was the CEO of the company at the time dictated, the ACPA had not considered the fact that saving Air Canada meant laying off some staff. This prompted the company to file for bankruptcy in 2004. In 2004, the union's ground crew at the company was involved in an unauthorized strike over allegations that some of the workers were punching timecards of their fellow co-workers. In consequence, the strike hampered the operations of the company since it grounded over 60 flights. As such, the union was also to blame since it initiated unlawful strike, which meant that the company would face more losses. Besides, the union members of the International Association of Machinists and Aerospace Workers (IAMAW) wore buttons that had a negative message to the company's management and to its customers. It meant that the workers were prejudicing the bargaining process. Even though the workers claimed that the move was in solidarity among the union members, it painted a bad image about the company, which means that the unions were also to blame of the difficulties the company faced. In addition, the unions, ACPA and IAMAW rejected the company's proposal of a defined contribution pension plan that was beneficial to the workers. In March, 2012, the machinists also went on strike, meaning that the company would lose more profits in the process. Besides, in April 2012, many pilots called in sick and never reported to work, to which the Canadian Industrial Relations Board termed the move as illegal, and subsequently forced the company to cancel flights, which meant more loses. As such, both Air Canada and the unions fuelled the difficulties the company face as the fights between the two meant that the company would not perform optimally, which is evidenced by the numerous cancelled flights.

Question 2: Responsibility of the Labour Unions and Air Canada for a Smooth Working Relationship

The unions and the company need to work together in solving issues amicably instead of fighting, which is the only hope for a smooth and working relationship in the future. The general actions that can be taken by Air Canada and the labor unions are respecting provisions set in the collective bargaining and employee contract agreements. In 2014, the ACPA and Air Canada ratified a new contract that provided for a collective agreement terms for ten years, which ends on September 9, 2024, the company and the ACPU need to respect the terms of the agreement. If any changes need to be implemented, then the company and the labor union should ratify any amendments without conflict and following a due process (Air Canada, 2017). Also since the company and IAMAW also agreed on a new ten-year contract that will end on March 31, 2026, both parties should also honor the provisions set in the agreement which will ensure a smooth working relationship (Air Canada, 2017). Also, the company should also honour and respect respective contracts it has set with flight attendants (CUPE), customer service and sales agents (Unifor), and dispatchers (CALDA) (Air Canada, 2017). By respecting the provisions set in these contracts, the company will offset any hostile and unauthorized actions that the workers might implement in retaliation if Air Canada performs adverse changes, such as laying off staff. According to CTV News (2011), the only way that the company will run an efficient and professional company is if it invests in the workforce. Even though employment contract are drafted in such a manner that they allow unilateral changes by the employer, as established in Wronko v. Western Inventory Service Ltd., 2008 ONCA 327, employees can reject unilateral changes and sue for damages, and thus, this demands the involvement of employees in case the company needs to change terms of employment.

Also, the specific actions that the company can take include avoid laying off a large number of staff at once, which can trigger a strike and other unauthorized actions from the workers (Annis, 2017). In essence, it is unlawful for a company to terminate employees and they can sue the company, and the employee is entitled to compensation after an assessment by the court (Association of Corporate Counsel & Osler, 2009). The company should also avoid threatening the labor union leaders. Doing so would only lead to more loses due to strikes and also leads to a negative image. The company should also incorporate benefits that would motivate all workers. Essentially, motivation ensures that the employee productivity is high. This eliminates the possibility of feuds between the company and its employees. In addition, the company should always implement change positively by involving the labour unions and the employees. Managers should learn to lead from the background and solve issues before they escalate. They should often meet union representatives and keep communication open. On the other hand, specific measures that the labour unions can implement include avoiding unauthorized strikes and always undertake actions that would not adversely affect the company, such as wearing clothes with negative connotations. Labour union leaders must also meet the company managers and solve issues amicably before escalation and keep communication with the company open.

Question 3: Agreements to Job Cuts

Due to the 2004 bankruptcy proceedings involving Air Canada, the company implemented various job cuts in various departments, a move designed to reduce labor costs, and the workers reluctantly agreed to the decision. Such actions to some extent may cause employees in Canada to be less likely to join unions as they fear that unions will not be able to protect their jobs once a company experiences a tough time. Essentially, this situation displayed that unions were at times unreliable in protecting employees. However, from the case, it is clear that the unions also played a significant role in protecting the interests of the employees and providing an avenue for collective bargaining and agreement. It is impossible for employees to individually negotiate for employment and collective bargaining contracts, which places unions in a prime position for ensuring that the rights of all employees are respected. Even though Air Canada filed for bankruptcy and initiated unilateral changes, this proved to be a mistake as it landed the company in feuds and conflicts with the labor unions that lasted for over a decade.

Companies cannot be trusted primarily because they can take actions that are designed to fulfill their interests at the expense of the well-being of the employee, which necessitates the inclusion of labor unions. For instance, Air Canada laid a lot of staff and eliminated benefits, which shows the negative stance the company took. Only the labor unions and the employees were against the move. Were it not for the labor unions, such as the ACPA and IAMAW, Air Canada would not have come up with a collective agreement that will allow for the smooth running of the company for the next ten years. As such, this stresses the importance of labor unions. In 2014 the ACPA and Air Canada ratified a new contract that provided for a collective agreement terms for ten years, which ends on September 9, 2024, while IAMAW also agreed on a new ten-year deal that will end on March 31, 2026 (Air Canada, 2017). As such, these moves spelled a new dawn in the labor relations between Air Canada and its employees. Mainly, even though positive moves by the company in implementing its labor policy might be an encouragement to the employees, they derive the ultimate protection by labor unions.

Question 4: Changing Collective Agreement Provisions in the Event of Financial Difficulty

I disagree with the statement, "if a company encounters financial difficulties, it should be allowed to change the provisions of a collective agreement with its labor unions" (Ebert, 2017, ). Mostly, the statement is one-sided in that allowing the company can do wherever it deems beneficial at the expense of the employee. The company cannot act unilaterally as it may not be in the best interest of the employee. Wronko v. Western Inventory Service Ltd., 2008 ONCA 327 established that when an employer sees to modify the existing relationship with workers, three possible scenarios can happen. First, the worker can accept the change of the terms, implicitly or expressly via an apparent acquiescence, in which the employment will continue under the new terms (Association of Corporate Counsel & Osler, 2009). Secondly, the worker can reject and sue the employer for damages if the employer persists in treating the employment relationship as subject to the different term (Association of Corporate Counsel & Osler, 2009). Thirdly, the employee may clarify to the employer that he or she is rejecting the new terms of employment, and the employer may respond by terminating the employee without notice and offering re-employment on the new terms (Association of Corporate Counsel & Osler, 2009). If the worker does not take this course of action and allows the employee to continue fulfilling his...