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The federal government is intervening to resolve a labour dispute between Air Canada and the union representing flight attendants.
Jobs Minister Patty Hajdu said on Saturday she has directed the Canada Industrial Relations Board to order both parties to resume operations and resolve the dispute through binding arbitration.
Hajdu said she made the call after meeting with both sides Friday night, finding that talks were breaking down and the two sides remained too far apart.
“In this instance, and despite resolution on a number of key items, this dispute will not be resolved quickly enough,” she said at a news conference in Ottawa. “Canadians have already sacrificed a lot in this uncertain economy and this labour disruption is adding to their worries and financial burdens.”
The move comes amid intense pressure from business groups to resolve the labour disruption that threatened an economy already reeling from the economic toll of U.S. President Donald Trump’s trade war.
“With both parties declaring an impasse in negotiations, with valuable cargo grounded and passengers stranded, the government made the right decision to refer the two sides to binding arbitration,” said Matthew Holmes, head of public policy for the Canadian Chamber of Commerce.
“Every hour counts given Air Canada says it will need up to a week for its network to be fully operationalized again, meaning that close to a million Canadians and international visitors could be impacted.”
Passengers around the world are feeling the effects after the union representing more than 10,000 flight attendants with Air Canada announced its members were walking off the job after it was unable to reach an eleventh-hour deal with the airline.
The strike officially began just before 1 a.m. ET on Saturday. A social media posting from Air Canada Master Executive Council (MEC), Air Line Pilots Association, Int’l (ALPA) said that Air Canada pilots stand in solidarity with the flight attendants.
Air Canada pilots stand in solidarity with CUPE flight attendants in a historic moment as they exercise their right to strike under the Canada Labour Code at 12:58 p.m. EDT. pic.twitter.com/9OnGRe8Wgs
— Air Canada ALPA Pilots (@AirCanadaPilots) August 16, 2025
Keelin Pringnitz and her family, from Ottawa, were returning from a European vacation, but were left stranded after flights were cancelled.
“It was an end of my maternity leave kind of trip. We went to the Faroe Islands and Norway, travelling through Air Canada to London,” Pringnitz said from London’s Heathrow Airport.
She and her family were working to find an alternative route home.
The airline said all Air Canada and Air Canada Rouge flights would be cancelled amid the work stoppage. Around 130,000 customers will be affected each day the strike continues, the company said.
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“Air Canada deeply regrets the effect the strike is having on customers,” it said in a brief statement early Saturday morning, adding that it is “strongly advising affected customers not to go to the airport unless they have a confirmed ticket on an airline other than Air Canada or Air Canada Rouge.”
Air Canada and Air Canada Rouge Action Lockout of Flight Attendants in Response to CUPE Strike. Read more: https://t.co/qwirA3yVaB pic.twitter.com/wQk0wm3CbL
— Air Canada (@AirCanada) August 16, 2025
Flights by Air Canada Express, operated by third-party airlines Jazz and PAL, are not affected.
The Air Canada component of the Canadian Union of Public Employees said picket lines will be active at airports across Canada, including Montreal, Toronto, Calgary and Vancouver. Striking flight attendants also plan to picket at airports in Halifax, Ottawa and Winnipeg.
“Negotiations between CUPE and Air Canada have ended in impasse,” the union said in a press release early Saturday morning.
“We are heartbroken for our passengers. We do not want to go on strike, and we do not want to be locked out, but it is clear that Air Canada has no incentive to bargain.”
Air Canada previously asked Jobs Minister Patty Hajdu to order the parties to enter a binding arbitration process — a power granted to the minister through Section 107 of the Canada Labour Code.
Please see my statement on the latest development between CUPE Flight Attendants at Air Canada and Air Canada:
//
Voici ma déclaration sur les derniers développements entre les agents de bord du SCFP d’Air Canada et Air Canada : pic.twitter.com/vYTuFThYgg— Patty Hajdu (@PattyHajdu) August 16, 2025
On Friday, Hajdu urged Air Canada and the union to get back to the negotiating table, suggesting she’s not ready to intervene in the dispute. The minister said the union has indicated many of its demands have been met, suggesting there is a path forward to a deal.
Hajdu had asked the union to respond to the company’s request. CUPE indicated Friday it opposed arbitration, instead maintaining its desire to solve the impasse through bargaining.
Although the government hasn’t said it will intervene, the union seemed to imply throughout the week that the writing could be on the wall.
Wages, unpaid labour a sticking point
CUPE accused Air Canada of refusing to bargain in good faith “due to the likelihood of the federal government using Section 107 of the Canada Labour Code to interfere in negotiations and have a contract imposed by an outside third-party arbitrator.”
The union has said its main sticking points revolve around wages that have been outpaced by inflation during its previous 10-year contract, along with unpaid labour when planes aren’t in the air.
“Air Canada still refuses to compensate flight attendants for all hours worked,” said CUPE’s press release.
“The union has been firm: all safety-related duties should be paid at full hourly rate. Air Canada does not agree. On wages, Air Canada’s last offer will still leave flight attendants living below poverty levels for many years to come.”
On Friday, the union released polling by Abacus Data indicating that 59 per cent of Canadians believe the federal government should respect flight attendants’ right to take job action, even if it causes travel disruptions.
The weighted survey of 1,500 respondents, conducted Thursday and Friday, said 88 per cent of Canadians believe flight attendants should be paid for all work-related duties including boarding, delays and safety checks.
Four-in-five respondents said they support raising flight attendant pay to meet the rising cost-of-living.
Air Canada has said its latest proposal included a 38 per cent increase in total compensation over four years, including a new provision for ground pay “that is industry-leading in Canada.”
The proposal would provide “significant improvements” to health benefits and pension plans, an increase to paid vacation and measures to address union concerns about rest and work-life balance, the airline said.
“It will make Air Canada flight attendants the best compensated in Canada,” the company said, adding its cabin crew already earn up to $17 more per hour than their counterparts at Air Canada’s largest domestic competitor.
Air Canada cancelled more than 600 flights over the past two days in preparation for a potential work stoppage, affecting 100,000 passengers.
It said it will notify customers with imminent travel of additional cancelled flights and their options.
The airline has said passengers whose flights are cancelled will be offered a full refund or the opportunity to change their travel plans without a fee.
As for Pringnitz and her family, she noted there was an option for travellers to go the United States but was told there wouldn’t be any further assistance once they landed in the U.S.
“It didn’t go over well with the line. Nobody really seemed interested, everybody seemed a little bit amused almost at the suggestion, or exasperated, because it is a bit ridiculous to offer to take stranded passengers to a different country to strand them there.”
For customers due to travel soon whose flights are not yet cancelled, Air Canada said it will allow them to rebook their travel or obtain a credit for future travel.
— with files from CJME News
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