Air Canada and the union representing its more than 10,000 flight attendants have begun arbitration to settle the wage portion of their contract, the last piece left unresolved after flight attendants voted more than 99 per cent to reject the airline’s final wage offer in September 2025.
Wages are the last unsettled piece
The Air Canada Component of the Canadian Union of Public Employees said the arbitration hearings opened this week, with arbitrator Paula Knopf presiding. The process began with a first hearing on Jan. 19, with further dates set for Jan. 28 and Feb. 19.
Most of the contract is already settled. Rules covering pensions, health benefits and vacation were agreed to by both sides last year and are considered final. Only the wage grid remains in dispute, and under the framework the two sides agreed to in September, the question went first to mediation and then, when no deal was reached, to arbitration.
“These hearings will provide our members an opportunity to hear the facts around what transpired in the negotiations spanning December 2024 to August 2025, and also a sense of what to expect from the process going forward,” component president Wesley Lesosky said in a statement.
“It will also give our members an opportunity to hear the extent to which Air Canada values our members and the vital, safety-critical work they do every day.”
A strike that stopped the airline
The arbitration traces back to one of the most disruptive labour disputes in Canadian aviation history. More than 10,000 Air Canada flight attendants walked off the job on Aug. 16, 2025, grounding flights during the peak summer travel season and disrupting the plans of hundreds of thousands of travellers.
The strike lasted nearly four days. Flight attendants defied a federal back-to-work order before a tentative deal was reached, and the dispute became a national flashpoint over unpaid work — the industry practice of paying cabin crew only when an aircraft is in motion, rather than for duties performed on the ground before takeoff and after landing.
When the tentative agreement went to a vote in September, members accepted the rest of the package but rejected the wage offer by more than 99 per cent. Air Canada said at the time that, at the union’s request, it had agreed to skip further mediation and send the wage question directly to arbitration, so that increases and retroactive pay dating back to April 2025 would flow as soon as possible.
What happens next
Because the wage question is in arbitration, neither side can resort to a strike or lockout while the process runs. Whatever Knopf decides will be binding and will complete the four-year collective agreement.
The union has argued that the airline’s offer did not reflect a decade of inflation since the previous contract took effect in 2015, and that attendants based in expensive cities such as Toronto were struggling on the proposed rates. Air Canada has pointed to the overall size of its offer and to industry norms.
The award, delivered in February
The arbitration concluded faster than many expected. On Feb. 17, 2026, Knopf issued her award, finalizing wages and closing the dispute. The ruling kept the rates from the tentative agreement for mainline flight attendants — a 12 per cent first-year increase for the most junior attendants and eight per cent for more senior ones — but raised the first-year increase at Air Canada Rouge to 13 per cent, a percentage point above the tentative deal.
Both groups receive increases of three per cent in the second year, 2.5 per cent in the third and 2.75 per cent in the fourth. The settlement also sets pay for ground duties, with attendants receiving half their hourly rate for 60 minutes of ground time on narrow-body aircraft and 70 minutes on wide-body planes, rising to 70 per cent of the hourly rate by 2028.
The union’s bargaining committee said the award was not the outcome it had fought for, but the decision means Air Canada’s flight attendants now have a complete contract running to March 2029 — and travellers face no further risk of a stoppage over this round of bargaining.
