Air Canada flight attendants have overwhelmingly rejected a tentative wage agreement, intensifying a labor dispute that has already seen the country's largest carrier face a multi-day strike. The results of the vote, which were anticipated on Saturday after 3 p.m. GMT, revealed a near-unanimous rejection by the more than 10,000 cabin crew members.

The union announced that 99.1% of its members voted against the proposed contract, with 94.6% of the membership participating. This decisive rejection comes after a tentative deal was struck on August 19, following a crippling four-day strike that caused the cancellation of over 2,000 flights and forced Air Canada back to the bargaining table after flight attendants defied government efforts to return to work.

Several flight attendants expressed deep dissatisfaction with the tentative agreement, which they felt fell short of addressing critical issues, particularly regarding compensation for unpaid labor. The proposed four-year deal included wage hikes ranging from 8% to 12% retroactive to April 1, followed by annual increases of 3%, 2.5%, and 2.75% in subsequent years. Some reports indicated an overall compensation increase of around 40% over four years, encompassing pension and benefits. Furthermore, the deal offered provisions for pre-flight pay, introducing 60 minutes for narrowbody planes and 70 minutes for widebody jets, with pay starting at 50% of the hourly rate in year one, gradually rising to 70% by year four.

Despite these provisions, crew members argued that the raises were insufficient to cover the escalating cost of living, especially in expensive cities like Toronto, leading many to hold multiple jobs. The core demand, central to the dispute, revolved around compensation for hours worked from check-in to clock-out, a practice not traditionally covered in the aviation industry where cabin crew are mostly paid when the aircraft is in motion. This demand for 'ground pay' is a growing trend among North American flight attendants, with United Airlines' flight attendants, represented by the Association of Flight Attendants (AFA), also rejecting a tentative agreement partly due to similar demands.

With the rejection of the wage portion, the only section subject to the vote, Air Canada's flight attendants are precluded from taking further legal strike action. Instead, the matter will now be referred to mediation, and if necessary, to arbitration, prolonging a dispute that previously led Air Canada to withdraw its financial guidance for 2025. Air Canada confirmed its commitment to this mediation and arbitration process, assuring the public that there would be no strike or lockout, and flights would continue to operate as scheduled.

The financial implications of a new contract are substantial for Air Canada. An analyst estimated that a new agreement could add over C$600 million (approximately $434 million) to the airline's costs over the contract period. Last year, the airline's total wages, salaries, and benefits amounted to C$4.9 billion, representing about 23% of its operating costs. The initial deal between Air Canada and the union was struck with a mediator at a Toronto airport hotel under the threat of criminal contempt charges against the union, as stated by Canadian Union of Public Employees President Mark Hancock.

The broader context of this labor struggle highlights a significant shift in the aviation industry, with flight attendants pushing for more equitable compensation models. Delta Air Lines Inc., for example, became the first U.S. carrier in 2022 to pay its flight attendants during boarding time, setting a precedent that other unions, including the AFA, are leveraging in their negotiations.