'Massive gap' between WestJet, pilots' union as strike looms and bookings fall: CEO

TORONTO -

WestJet CEO Alexis von Hoensbroech says the company and its pilots' union remain far apart on key sticking points – especially wages – as negotiations heat up and the clock ticks down on a strike deadline.

"The gap is still massive," von Hoensbroech said during a video call Tuesday night from the bargaining venue, a hotel north of Toronto.

More than 1,800 pilots at WestJet and its Swoop subsidiary are poised to walk off the job as of 3 a.m. EDT on Friday after the union issued a strike notice Monday night.

The standoff has left thousands of passengers with travel plans for the May long weekend and beyond hanging in limbo.

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In recognition of the uncertainty, the airline is offering refunds to passengers who change or cancel flights scheduled until May 21. Changes must be requested more than two hours before departure.

The deadlock has already dented sales.

"We do see softening in bookings," the CEO said. "It is painful.

"Although we still get bookings, so the majority of our guests seem to assume that we are maintaining flying. And this is our intention."

The company hasn't turned an annual profit since 2019 due the devastation wrought by the COVID-19 pandemic, he said. Von Hoensbroech took over in February 2022, just over two years after Onex Corp. acquired the airline.

With more than 16,700 flights slated for this month, WestJet carries nearly a third of Canada's domestic market, while Air Canada has half of it.

WestJet's latest offer to the union would see wide-body plane captains earn $350,000 in total compensation annually by the end of the collective agreement term, according to a letter to flight crew from the company and obtained by The Canadian Press. Narrow-body captains would earn $300,000.

"Immediately upon the effective date, WestJet pilots would have had the highest narrow-body first officer and captain top-step wage rate in Canada," the Monday night letter states.

The union did not respond immediately to a request for comment.

Bernard Lewall, who heads the Air Line Pilot Association's WestJet contingent, has said pay, scheduling and job security remain the key areas of dispute – one point on which the CEO agrees.

Lewall said some 340 pilots have left the carrier over the past year and a half – mostly for other Canadian airlines. But von Hoensbroech said WestJet's mainline fleet has hired three times the number of pilots who've resigned.

He acknowledged that its regional segment, WestJet Encore, has lost plenty of workers, but noted that they are not part of the current bargaining.

The union head said more pilots will flee the company if the deal falls short of members' needs.

"After nine months of negotiating, management still fails to understand today's labour market conditions, leading to a mass exodus of our pilots in search of better work opportunities," Lewall said in a statement Monday.

In response to the strike notice, WestJet issued a lockout notice shortly before midnight Monday to maintain "control" over its planes, the CEO said.

"If a strike hits us on short notice at a point where we don't expect it, we may strand an airplane somewhere in the Caribbean – in I don't know where," von Hoensbroech said. "Then we are in trouble."

The CEO as well as WestJet's chief operating officer and chief financial officer have all descended on a hotel in Richmond Hill, Ont., to try to hash out a deal with the union.

On Wednesday, Transport Minister Omar Alghabra encouraged the two sides to reach a resolution, noting a federal mediator is on the ground.

"I do not want to put my finger on the scale," he said. "Obviously the airlines have obligations towards their customers. But ultimately the biggest obligation is to make sure that they deliver the service that they sold to customers."

In the event of a delay or cancellation, customers will be "refunded or re-accommodated, as applicable," the airline said Monday.

Regulations entitle passengers to a rebooking within 48 hours of a cancellation or three-hour-plus delay, according to the Canadian Transportation Agency.

If the airline can't meet those obligations, the passenger can opt for a refund or alternate travel arrangements, free of charge, on "any airline travelling on a reasonable route from the same airport" – or from a nearby airport, and the carrier must "transport you there," the agency website states.

As negotiations ground on Wednesday, the Air Line Pilots Association approved a merger with the Air Canada Pilots Association, bringing the country's two biggest flight crew labour groups under one roof.

The move means 95 per cent of professional Canadian pilots are represented by a single union, effective immediately, said Charlene Hudy, the Air Canada union's council chair.

"With the collective strength of over 73,000 pilots in North America, we look forward to working toward a better future for the piloting profession and aviation industry as a whole," she said in a statement.

The two groups had reached a merger agreement in principle in March, and Air Canada pilots voted to ratify the deal on May 1.

This report by The Canadian Press was first published May 17, 2023.