Air Canada To Stop Accepting Government Wage Subsidy

Air Canada is reported to be laying off thousands of employees in a way that will prevent them from accessing government support. The airline is asking employees to take unpaid leave, cuts to their hours, or to resign voluntarily, all of which will make them ineligible for the COVID-19 funding set out by the federal government. Unions accuse the airline of leaving its workers “out in the cold”.

Air Canada
Air Canada is expecting a slow return of travel demand, and is laying off thousands of workers. Photo: Getty Images

Air Canada staff will be asked to leave voluntarily

Air Canada has confirmed that it will no longer use the federal emergency wage subsidy. Instead, it plans to give employees the option of taking unpaid leave, reduced work hours, or resigning from their posts.

The airline announced last week that it would reduce its workforce by as much as 60%, with as many as 20,000 jobs at risk. Now, the shape of those layoffs is beginning to become clear, with Air Canada choosing not to access government funding to subsidize the wages of those who are facing the loss of their jobs.

In a statement carried by the Financial Post, Air Canada said,

“The extent of these layoffs has had a severe impact and is understandably upsetting for everyone at Air Canada.

“It is only regretfully that we take these measures, which are unavoidable given the profound effects of COVID-19 upon our business, which has currently been reduced by as much as 95 percent with no prospect of a near- to mid-term recovery and a consequent reduction in our staffing requirements.”

Air Canada repatriation flights
Thousands of workers face losing their jobs, and being unable to access federal COVID funding. Photo: Air Canada

In detail, it is being reported that employees are being asked to take leave, unpaid, for between six and 24 months. If they aren’t willing to do this, then they can either reduce their working hours to a bare minimum, with no wage top-up, or to voluntarily resign from their post.

Because these actions are all categorized as ‘voluntary,’ workers will be unable to access the Canada Emergency Response Benefit (CERB), which would provide laid off staff with up to CA$2,000 ($1,430) per month. Air Canada has also allegedly made the option of the Canada Emergency Wage Subsidy unavailable to staff.

Unions unhappy

The union that represents flight attendants of both Air Canada and Air Canada Rouge has released a statement expressing its frustration with the situation. It says that the way Air Canada has undertaken the layoffs leave staff unable to access the emergency COVID-19 benefits that have been set out by the government.

Air Canada Rouge
Unions accuse the airline of leaving its workers “out in the cold.” Photo: Getty Images

Wesley Lesosky, President of the Air Canada Component of the Canadian Union of Public Employees, commented that,

“The government and Air Canada are washing their hands of this devastating situation and the only options our members are left with is either quit or get laid off and go on EI. This is shameful and disrespectful towards the workers who have built this airline, who faced this epidemic on the front lines, and who were among the first in Canada to get sick with COVID-19 while doing their jobs.”

Lesosky suggests that the issue could be resolved if the airline was to work with the government to make more meaningful options available. He states that workers are being left ‘out in the cold’ through no fault of their own.

What do you make of Air Canada’s decision to deal with layoffs in this manner? Let us know your thoughts in the comments.