The union representing Air Canada's customer service workers won the right to maintain a defined benefit pension plan for new hires, a contentious issue which played a roll in the carrier's summer strike.
In June, the issue of pensions for new hires was sent to arbitration after the union and Air Canada were unable to come to an agreement. Air Canada tabled a final offer for a 100 per cent defined contribution plan.
For three days, 3,800 customer service workers were on strike, reaching an agreement on June 16 before back-to-work legislation, prepared by the federal government, could be debated in Parliament.
Kevin Burkett, a federal arbitrator, rejected Air Canada's demand to put new hires into a defined contribution pension plan, siding with the Canadian Auto Workers union's proposal to maintain the existing plan.
The union argued the defined benefit pension plan was efficient, effective and economically productive. To shift to a defined contribution system would have had a detrimental impact on future workers, the union said.
CAW president Ken Lewenza said the ruling is important for all of Air Canada's employees.
"This is an extremely important ruling and demonstrates that no employer, regardless of how large or small, should believe they have the unmitigated right to destroy a worker's retirement security," Lewenza said in a statement released Sunday.
The result of the ruling is a hybrid pension for future hires, which consists of both defined benefit and defined contribution components. New hires will receive part of their benefit from the existing pension plan and part from a defined contribution plan, contributed to by both workers and the employer.
On Sunday, Air Canada is looking over a new contract proposal from the Canadian Union of Public Employees representing 6,800 flight attendants ahead of Wednesday's strike deadline.
