(Reuters) – Air Canada has reached an agreement that would allow the airline to furlough up to 600 pilots because of plummeting traffic due to coronavirus, according to a letter from the union reviewed by Reuters on Tuesday.
Air Canada, the country’s largest carrier, is slashing capacity due to the collapse in travel demand from the coronavirus outbreak which has forced many governments to impose travel restrictions.
The agreement covers six months from April through the end of September, according to the letter dated March 23.
Air Canada did not immediately respond to requests for comment.
Carriers are making unprecedented cuts to flights, costs and staffing while stepping up calls for emergency aid from governments to save jobs.
Global passenger capacity fell by 35% last week, the worst since the start of the crisis, according to data from airline schedules firm OAG, which said deeper cuts were likely in the coming weeks.
Air Canada reached the agreement as its April schedule was reduced by 80% and the carrier has suspended its leisure service Rouge, the union letter said.
The deal “represents our best efforts to balance our responsibility to our members, alongside the requirement for the company to reduce its costs as quickly as possible in line with the schedule reduction and for its long-term viability.”
Pilots on furlough continue to accrue seniority and would be later recalled in order of seniority.
Air Canada shares were up about 17% in late morning trade, but still down about 70% this year.
“Due to the complexity of pilot training, the precise number of positions immediately affected is still unclear and we will be working with Air Canada in the coming days and weeks to better understand the situation,” said Captain Michael McKay, Chair, Air Canada Pilots Association, in the statement.