WestJet retreats on labour code exemption that would facilitate mass layoffs

WestJet Airlines Ltd. says it has halted its pursuit of a labour code exemption that would have facilitated mass layoffs.

WestJet aviation security manager Jared Mikoch-Gerke told the House of Commons health committee Monday the airline had revoked its request for exemption from Canada Labour Code provisions that require 16 weeks' notice ahead of a mass layoff, which refers to 50 workers or more.

WestJet has laid off some 9,000 of its 14,000 employees since the COVID-19 pandemic struck, the executive said.

The crisis has seen the Calgary-based company park two-thirds of its fleet after border shutdowns prompted it to suspend most routes including all international trips in late March, though it plans to resume several routes between Canada and the U.S. at the end of the month.

An exemption would also nix the need to engage in a union-employer planning committee to develop an adjustment program to reduce layoffs.

"An adjustment plan that minimizes the impact of termination and assists employees in obtaining other employment is particularly important in all cases where there will be a reduction in the workforce," Chris Rauenbusch, a union official who represents WestJet flight attendants, said in a letter to Labour Minister Filomena Tassi on April 28. Shared work schedules, furloughs and training for new roles are all possible outcomes.

The correspondence came a day after a letter to Tassi, signed by vice-president Mark Porter and obtained by The Canadian Press, which stated that the labour code provisions are "seriously detrimental" to its operations and "unduly prejudicial" to the company and its staff.

The company said in an email last month the exemption would give it flexibility "to act in a timely manner" amid the pandemic.

A labour code exemption would further scrap the union's ability to request federal arbitration should the committee fail to yield fruitful solutions, Rauenbusch said.

Air Canada hasn't withdrawn its application

Air Canada has not withdrawn its application to the federal labour minister for an exemption, but has received no response so far, a senior executive told the parliamentary health committee Monday.

The Montreal-based airline, which has laid off more than 20,000 of its 38,000 employees, has joined with WestJet and other companies from across industries in asking the prime minister and premiers to ease restrictions on international and interprovincial travel.

Air Canada has opted not to reapply for the federal government's Canada Emergency Wage Subsidy program now extended until Aug. 29 for most employees.

"We chose to not continue with it," Ferio Pugliese, Air Canada's vice-president of government relations, told the health committee Monday.

"There's still an extensive expense that comes along with payroll taxes, pension and benefit costs," which are not covered by the subsidy, he said. The continuous cash drain was adding further strain to a company that lost more than $1 billion last quarter and continues to bleed about $20 million per day.

The program covers 75 per cent of a worker's normal hourly wages or up to $847 per week. For airlines, however, the vast majority of those workers have stayed at home, as operations remain at a virtual standstill.