Evidence of meeting #31 for Transport, Infrastructure and Communities in the 41st Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was aveos.

A recording is available from Parliament.

On the agenda

MPs speaking

Also speaking

Chuck Atkinson  President and Directing General Chairman, District Lodge 140, Mississauga, International Association of Machinists and Aerospace Workers in Canada
Jean Poirier  General Chairman, District Lodge 140, Montréal, International Association of Machinists and Aerospace Workers in Canada
Gilles Brosseau  Québec Coordinator, International Association of Machinists and Aerospace Workers in Canada
Louis Erlichman  Canadian Research Director, International Association of Machinists and Aerospace Workers in Canada
Tony Didoshak  General Chairman, District Lodge 140, Winnipeg, International Association of Machinists and Aerospace Workers in Canada
Christopher Hiscock  President, Local Lodge 764, Richmond, International Association of Machinists and Aerospace Workers in Canada

8:45 a.m.

Conservative

The Chair Conservative Merv Tweed

Good morning, everyone. Welcome to the Standing Committee on Transport, Infrastructure and Communities, meeting 31, televised for everyone's information.

Pursuant to Standing Order 108(2), we are here for a study on the closure of Aveos Fleet Performance Inc.

Joining us today, from the International Association of Machinists and Aerospace Workers in Canada, we have Mr. Louis Erlichman, Canadian research director; Jean Poirier, general chairman; Chuck Atkinson, president and director general; Tony Didoshak, general chairman; Christopher Hiscock, president; and Gilles Brosseau, Quebec coordinator.

Welcome.

I am sure that Alexandre has given the directions.

Mr. Atkinson, I think you're going to open with some remarks. Please proceed.

8:45 a.m.

Chuck Atkinson President and Directing General Chairman, District Lodge 140, Mississauga, International Association of Machinists and Aerospace Workers in Canada

Thank you, Mr. Chairman.

We'd like to thank the committee for the opportunity to appear before you and to present our views on the Aveos closure.

The International Association of Machinists and Aerospace Workers is the largest union in the Canadian air transport sector, having represented Canadian airline workers for over 70 years. We represent 2,600 Aveos workers, most of whom were transferred from Air Canada. We also represent around 2,300 members who continue to perform aircraft line maintenance at Air Canada.

The recent announcement of Aveos's closure and the loss of over 2,600 direct jobs across Canada is shocking, but it does not come as a surprise. It is the result of a series of government policies and Air Canada actions that have undermined the Canadian aircraft maintenance industry.

Aircraft maintenance is a growing global industry, providing highly skilled employment and a major component of Canada's skills and technology base. Aveos, the former heavy maintenance division of Air Canada, is a major repository of the skills and know-how on which this sector depends.

The Aveos closure is more than the loss of over 2,600 high-skilled jobs, thousands of spinoff jobs, and many millions of dollars of lost income and tax revenue. It has serious effects on the cities of Montreal, Winnipeg, and Vancouver in these difficult economic times. The Aveos closure deals a body blow to this economically important sector.

When the federal government privatized Air Canada in 1988, we raised serious concerns about the potential for a privatized Air Canada to move much of its work and jobs out of Canada. The government responded by including in the Air Canada Public Participation Act “provisions requiring the Corporation to maintain operational and overhaul centres in the City of Winnipeg, the Montreal Urban Community and the City of Mississauga”.

The merger of Air Canada and Canadian Airlines has since added Vancouver as a major Air Canada maintenance centre.

In 1988 both the government and Air Canada stated publicly that the Air Canada Public Participation Act guaranteed that employment performing aircraft overhaul would be maintained, and indeed expanded, in these communities.

Frankly, these provisions did not allay our concerns. We feared that a privately owned Air Canada's drive for short-term gain would undermine this commitment. Our fears have now been realized.

From the time that Air Canada exited from creditor protection in 2004, Air Canada management proceeded systematically to dismantle the corporation, selling off assets and sucking over $2 billion out of the company, rewarding themselves handsomely while financially weakening the airline.

As part of this asset-stripping exercise, a majority share in the heavy maintenance division, Aveos, was sold for over $700 million in 2007. At that time, Air Canada committed contractually to provide Aveos with continuing work maintaining Air Canada's aircraft.

Subsequently, close to half of Air Canada's maintenance workforce was forced to transfer to Aveos on the promise of continued long-term employment, based on long-term Air Canada contracts.

Air Canada has not followed through on its commitment to provide the work to sustain Aveos, leading Aveos to file for creditor protection and announce its closure.

Air Canada has not provided us with the information as to where it plans to have the heavy maintenance work done. The speculation is that it may not be done in Canada.

While all of this has been unfolding, the federal government has stood by, making no effort to save this company and this sector. Even as Aveos announced its demise, the government has refused to act. While the government showed no hesitation to step in to quash our members' collective bargaining rights at Air Canada on the grounds of economic necessity, it is unwilling to take any steps to maintain thousands of jobs and a vibrant sector.

We are prepared to take legal action to get Air Canada to live up to the requirements of the 1988 legislation, but we are not here to talk about a legal issue. This is an economic and a moral issue for us. Is the government prepared to stand by and watch the demise of a major player in a key sector of our economy? That's the question.

We call upon the Harper government to respect its commitment under the law to support these jobs and the aviation maintenance industry in Canada.

Thank you.

Now we'll be open for questions.

8:50 a.m.

Conservative

The Chair Conservative Merv Tweed

Thank you very much.

Mr. Nicholls.

8:50 a.m.

NDP

Jamie Nicholls NDP Vaudreuil—Soulanges, QC

Thank you, Mr. Chair.

We know that the minister is going to hide behind his lawyers, and so we will talk about topics other than the current legislation.

The President and Chief Executive Officer of Air Canada suggested to this committee that the federal economic development agencies could assist in the establishment of new maintenance, repair and overhaul companies in Canada to employ the skilled labour and make use of the facilities that already exist.

What do you think the role of the federal government should be in getting your members back to work in Canada?

8:50 a.m.

Jean Poirier General Chairman, District Lodge 140, Montréal, International Association of Machinists and Aerospace Workers in Canada

We all know that the provinces and the mayors of the cities are prepared to support us. Yet, all we are hearing from the Conservative government right now is that there is no bailout plan. The government has no intention of helping us.

Today, we are really here to talk to the government and to tell it to get involved. The government must save jobs. It has a law to enforce and it must stop hiding. The government must stand with us, the provinces, the cities, Canadians and all those who today are unemployed and out on the street without any money and without a termination form. The government must get involved. This law falls within the federal government's jurisdiction and the federal government must get involved.

8:50 a.m.

NDP

Jamie Nicholls NDP Vaudreuil—Soulanges, QC

We are talking about the transfer of machinist and other jobs from Air Canada to Aveos. What year were most Air Canada employees transferred to Aveos?

8:50 a.m.

General Chairman, District Lodge 140, Montréal, International Association of Machinists and Aerospace Workers in Canada

Jean Poirier

With regard to Aveos, the sale was complete in 2007, but the jobs were not transferred until July 2011. Today, eight months later, everyone is out on the street.

Last year, I attended a meeting of the same parliamentary committee. All the same people may not have been there but I recognize a few who know what happened and who knew what was coming. Today, the members of the government will say that they no longer remember. They are sitting on the sidelines while people are out on the street without jobs. I am reiterating this a lot today because I want to speak to your emotions. The government is supposed to work for the people, for jobs, for Canadians. It must not work only for company shareholders.

8:55 a.m.

NDP

Jamie Nicholls NDP Vaudreuil—Soulanges, QC

I would like to talk about the management transfers at Air Canada. Were managers at Air Canada transferred to Aveos?

8:55 a.m.

General Chairman, District Lodge 140, Montréal, International Association of Machinists and Aerospace Workers in Canada

Jean Poirier

Yes, absolutely. There are managers who moved directly from Air Canada to Aveos.

8:55 a.m.

NDP

Jamie Nicholls NDP Vaudreuil—Soulanges, QC

So, it is possible that these people knew what was going to happen, that they were aware of the action Aveos was going to take and that they could have easily explained it to Air Canada management. Is that correct?

8:55 a.m.

General Chairman, District Lodge 140, Montréal, International Association of Machinists and Aerospace Workers in Canada

Jean Poirier

I have been part of the company from the beginning of this process. This is just my opinion, but I do not believe that all the managers who were transferred to Aveos were fully aware of the plan that brought us to where we are today. I think that all these decisions were made by senior management, either by Mr. Kolshak from United Airlines and Delta or perhaps by Mr. Butterfield. I do not believe that the lower managers were aware of what was happening.

8:55 a.m.

NDP

Jamie Nicholls NDP Vaudreuil—Soulanges, QC

And yet, we know that the Conservatives did not want to call Mr. Kolshak as a witness, so we cannot ask him any questions about that.

Can you explain to the committee why the closure of Aveos' plants is in direct violation of the Air Canada Public Participation Act?

Is the privatization of Air Canada's maintenance facilities the first step toward shipping jobs off to other countries?

8:55 a.m.

General Chairman, District Lodge 140, Montréal, International Association of Machinists and Aerospace Workers in Canada

Jean Poirier

I think that people are beginning to have a clearer understanding of what is happening. As I explained a few weeks ago, there is a spirit underlying this act. You are all parliamentarians and you all know how it works when a law is established. A legislative committee meets and the law is discussed for months to ensure that the right things are put in the right place.

I listened to what Benoît Bouchard, who was there at the time, had to say. He said that no member from Quebec or Manitoba would have voted in favour of this bill had they known that it would result in this situation. They thought it was clear that the overhaul centres were going to be kept in the three cities. Vancouver is also now included.

8:55 a.m.

NDP

Jamie Nicholls NDP Vaudreuil—Soulanges, QC

The Ontario Supreme Court's decision in this regard is clear. The judge said that Air Canada was complying with the law because of the existence of Aveos. Now that Aveos has closed its doors, it could be said that Air Canada is no longer complying with the Act.

8:55 a.m.

General Chairman, District Lodge 140, Montréal, International Association of Machinists and Aerospace Workers in Canada

Jean Poirier

In my opinion, right now, the law is not being respected.

8:55 a.m.

NDP

Jamie Nicholls NDP Vaudreuil—Soulanges, QC

Does Ms. Morin have any questions?

8:55 a.m.

NDP

Isabelle Morin NDP Notre-Dame-de-Grâce—Lachine, QC

Last week, we learned that the government refused to require Aveos representatives to appear before the committee. Do you have any comments about that? Does that make sense to you? Do you think that the government did its job?

8:55 a.m.

General Chairman, District Lodge 140, Montréal, International Association of Machinists and Aerospace Workers in Canada

Jean Poirier

I am not surprised. The fact that Aveos managers do not want to appear before the committee just shows that they have something to hide.

No, I am not surprised. That is the only answer I can give you in this regard.

8:55 a.m.

NDP

Isabelle Morin NDP Notre-Dame-de-Grâce—Lachine, QC

Did you finally succeed in contacting anyone at Aveos? Did you speak with the managers at Aveos? What happened there?

8:55 a.m.

General Chairman, District Lodge 140, Montréal, International Association of Machinists and Aerospace Workers in Canada

Jean Poirier

I know that Aveos is downsizing. Many people are leaving. There are about three people left to take care of some 2,600 employees. That is not a very big team and it is unable to even provide employees with termination forms right now. We have mentioned how these employees are not receiving any wages, but they are also unable to receive employment insurance benefits because they have not yet been sent their termination forms.

The company ceased operating three weeks ago. The employees are in dire straits. It is completely ridiculous. I do not know which authority to turn to. The government's representatives, those who are responsible for employment insurance, have not done anything. I do not know whether they need to make telephone calls so that these workers are sent their termination forms. In addition to not receiving wages, the workers are also not receiving any employment insurance benefits.

8:55 a.m.

Conservative

The Chair Conservative Merv Tweed

Thank you.

Monsieur Coderre.

8:55 a.m.

Liberal

Denis Coderre Liberal Bourassa, QC

Thank you, gentlemen.

I must admit that this morning it seems as though you are stuck in a holding pattern. I believe that Air Canada must comply with the act but the reality is that the government can present a legal opinion claiming that Air Canada is in compliance with the act. We are unable to make the distinction between heavy maintenance and level one maintenance. We are not talking about an oil change but about taking an aircraft apart and putting it back together.

I would like to speak briefly about the legal aspect of the problem. Essentially, there are two realities: the legal issue and the political issue, which I will come back to.

Mr. Brosseau, what exactly is your role as a Quebec coordinator?

9 a.m.

Gilles Brosseau Québec Coordinator, International Association of Machinists and Aerospace Workers in Canada

I coordinate activities in Quebec. It is important to explain that our territory is national. That is why we have workers everywhere. I am not directly linked that this section. I am more a part of the Quebec section.

9 a.m.

Liberal

Denis Coderre Liberal Bourassa, QC

You are not a chaperone. You do not monitor Jean Poirier.

9 a.m.

Québec Coordinator, International Association of Machinists and Aerospace Workers in Canada

Gilles Brosseau

No. I am not a mother-in-law either.

9 a.m.

Liberal

Denis Coderre Liberal Bourassa, QC

The government is saying that it does not want to do anything because Air Canada is complying with the act. The government is saying that it does not want to make a bailout plan. I saw that, yesterday, a job fair was held, which was organized by the employee union, so that representatives from Emploi-Québec and others could find a way to transfer these jobs, which is a good thing.

My first question is very clear: if Aveos is not paying you, is it because its representatives have told you that they will pay you only if you do not take them to court?

9 a.m.

General Chairman, District Lodge 140, Montréal, International Association of Machinists and Aerospace Workers in Canada

Jean Poirier

I have not been told that, but you may have a point.

9 a.m.

Liberal

Denis Coderre Liberal Bourassa, QC

Could that be the case?

9 a.m.

General Chairman, District Lodge 140, Montréal, International Association of Machinists and Aerospace Workers in Canada

Jean Poirier

It could be a result of the fact that we are putting pressure on the governments and we are trying to get our employees back to work. Managers are perhaps exerting pressure in another way, by not paying employees or by not giving them their termination forms. It would be really— I will not say the word here.

9 a.m.

Liberal

Denis Coderre Liberal Bourassa, QC

We know what you were thinking.

9 a.m.

General Chairman, District Lodge 140, Montréal, International Association of Machinists and Aerospace Workers in Canada

Jean Poirier

It is not said.

9 a.m.

Liberal

Denis Coderre Liberal Bourassa, QC

Mr. Brosseau, has this type of thing happened?

9 a.m.

Québec Coordinator, International Association of Machinists and Aerospace Workers in Canada

Gilles Brosseau

What is your question, Mr. Coderre?

9 a.m.

Liberal

Denis Coderre Liberal Bourassa, QC

Is it possible that Aveos representatives told you that they would pay you if you signed an agreement that you would not take the company to court?

9 a.m.

Québec Coordinator, International Association of Machinists and Aerospace Workers in Canada

Gilles Brosseau

Are you asking me if they told us that?

9 a.m.

Liberal

Denis Coderre Liberal Bourassa, QC

Yes.

9 a.m.

Québec Coordinator, International Association of Machinists and Aerospace Workers in Canada

Gilles Brosseau

No, they did not.

9 a.m.

Liberal

Denis Coderre Liberal Bourassa, QC

They did not try that?

9 a.m.

Québec Coordinator, International Association of Machinists and Aerospace Workers in Canada

9 a.m.

Liberal

Denis Coderre Liberal Bourassa, QC

Good. I was simply thinking to myself that they could ask you to do anything because they are not following the rules and they have you over a barrel.

Mr. Atkinson, listen, I think it's totally disgusting what's going on right now, and I feel we have to do something about it. We have to chew gum and walk at the same time. The judicial issue is just as important, but it won't immediately bring you some bread and butter on the table. You have to take a look and take care of the people first so they can get a job or at least keep one.

I don't understand the issue of should the provincial government or should the union sue Air Canada—or Aveos, in this case—to find a way to make sure that Air Canada complies with the law. In a short time, you said you don't want to talk about it but you're ready to do so.

Is it my understanding that the union would be ready to sue Air Canada to make sure they comply with the law?

9 a.m.

President and Directing General Chairman, District Lodge 140, Mississauga, International Association of Machinists and Aerospace Workers in Canada

Chuck Atkinson

That's something that's been discussed with our legal people. That's about as far as I can go right now.

9 a.m.

Liberal

Denis Coderre Liberal Bourassa, QC

If the international association doesn't want to do it because of some other interests or some strategic reason, would it be possible that the regional component of your union would be able then to sue Air Canada? If, for example, Winnipeg or Quebec wants to do it by themself, would it be possible to do so?

9 a.m.

President and Directing General Chairman, District Lodge 140, Mississauga, International Association of Machinists and Aerospace Workers in Canada

Chuck Atkinson

I guess it would be possible, but we don't have a problem with our international association. International vice-president Dave Richie has made it very clear that we will do whatever is necessary.

9 a.m.

Liberal

Denis Coderre Liberal Bourassa, QC

Mr. Poirier, we know you often use colourful language. Clearly, we are looking to the future. The Government of Canada is saying that it does not want to do anything. It is sitting on its hands and it does not want to come up with a bailout plan. It is not me who is saying it, it is the minister himself. The minister has shirked his responsibilities and the government has also failed you.

That being said, how do you think that the Government of Quebec and the Government of Manitoba could help you at the political level. I spoke to the Premier of Manitoba and he wants to do anything he can to help. Clearly, the Premier of Ontario feels the same way.

Radio-Canada has mentioned a revitalization committee. Has there been only informal discussions? For example, could the QFL Solidarity Fund be a partner in the event that another buyer was found? You are not there to pay workers in Aveos' place but I imagine that, if a company was prepared to invest, the Solidarity Fund could be a partner. Is this one of the potential strategies?

I would like to hear Mr. Poirier's and Mr. Brosseau's comments on this.

9:05 a.m.

Québec Coordinator, International Association of Machinists and Aerospace Workers in Canada

Gilles Brosseau

The Solidarity Fund works with all sorts of companies in the aerospace industry. In this regard, I contacted the fund's representatives—I am also the vice-president of the QFL—to ask them whether some companies on the list may have expressed an interest in the past or may be interested now, but no one has stepped forward as of yet.

The Solidarity Fund is a strong social and economic partner in Quebec. Its job is not to manage or create a company. In other words, it does not repair planes. However, a company could submit to us a serious business plan. I am talking here about a company that deals with operations and not one that is just an investment company, such as KKR. I am not saying that that is not an option, but we would prefer a company that deals with operations.

What concerns me about your question is that it seems as though you are putting the ball in someone else's court. We came here to meet with the federal government, but you are putting the ball in the court of Quebec, the provinces and the Solidarity Fund. That is going a bit far.

There is no revitalization committee as such, but we have had several discussions with the Quebec department of economic development, innovation and export trade, which is also planning a tour of Quebec's trade missions in various countries and in Canada. If a company was prepared to buy Aveos, the Government of Quebec does seem to be open to providing help. However, this falls under federal jurisdiction.

9:05 a.m.

Liberal

Denis Coderre Liberal Bourassa, QC

We will come back to this since my time is up.

Thank you very much for your response.

9:05 a.m.

Conservative

The Chair Conservative Merv Tweed

Monsieur Poilievre.

9:05 a.m.

Conservative

Pierre Poilievre Conservative Nepean—Carleton, ON

Can you please indicate which section of the Air Canada Public Participation Act refers to Aveos?

9:05 a.m.

President and Directing General Chairman, District Lodge 140, Mississauga, International Association of Machinists and Aerospace Workers in Canada

Chuck Atkinson

It obviously does not.

9:05 a.m.

Conservative

Pierre Poilievre Conservative Nepean—Carleton, ON

Which section of the Air Canada Public Participation Act refers to your union?

9:05 a.m.

President and Directing General Chairman, District Lodge 140, Mississauga, International Association of Machinists and Aerospace Workers in Canada

Chuck Atkinson

It does not.

9:05 a.m.

Conservative

Pierre Poilievre Conservative Nepean—Carleton, ON

So there's no section in the law that forces your union to represent the workers who will ultimately do the overhaul and maintenance work, and there's no section in the law banning Aveos from going bankrupt?

9:05 a.m.

President and Directing General Chairman, District Lodge 140, Mississauga, International Association of Machinists and Aerospace Workers in Canada

Chuck Atkinson

What's your point?

9:05 a.m.

Conservative

Pierre Poilievre Conservative Nepean—Carleton, ON

The reason I asked my question is that I'm trying to find out what you want the federal government to do with respect to the law.

9:05 a.m.

President and Directing General Chairman, District Lodge 140, Mississauga, International Association of Machinists and Aerospace Workers in Canada

Chuck Atkinson

We would like the federal government to at least respect the spirit of the law and keep the—

9:05 a.m.

Conservative

Pierre Poilievre Conservative Nepean—Carleton, ON

Please be specific.

9:05 a.m.

President and Directing General Chairman, District Lodge 140, Mississauga, International Association of Machinists and Aerospace Workers in Canada

Chuck Atkinson

—aircraft maintenance industry in Canada.

9:05 a.m.

Conservative

Pierre Poilievre Conservative Nepean—Carleton, ON

Okay, what specific actions are you asking for?

9:05 a.m.

President and Directing General Chairman, District Lodge 140, Mississauga, International Association of Machinists and Aerospace Workers in Canada

Chuck Atkinson

I'm not here to direct the government to do anything.

9:05 a.m.

Conservative

Pierre Poilievre Conservative Nepean—Carleton, ON

Presumably you have some—

9:05 a.m.

President and Directing General Chairman, District Lodge 140, Mississauga, International Association of Machinists and Aerospace Workers in Canada

Chuck Atkinson

Excuse me. Can I answer the question?

9:05 a.m.

Conservative

Pierre Poilievre Conservative Nepean—Carleton, ON

You just said you're not going to answer the question.

9:05 a.m.

Conservative

The Chair Conservative Merv Tweed

Mr. Coderre, you have a point of order?

9:05 a.m.

Liberal

Denis Coderre Liberal Bourassa, QC

Mr. Chair, could we show some respect and let the witness answer, please?

9:05 a.m.

Conservative

The Chair Conservative Merv Tweed

I was going to ask the witness to finish his comments, and then we'll go back to Mr. Poilievre, please.

9:05 a.m.

President and Directing General Chairman, District Lodge 140, Mississauga, International Association of Machinists and Aerospace Workers in Canada

Chuck Atkinson

Thank you.

We don't have a direction for the government. As I said, we're not here to talk about the law. Tons of lawyers right across the country will be dealing with that. What we really need and what we're asking for is some respect for the people who have been taxpayers, citizens of this country, have been working to keep the airline going over the last ten years.

9:05 a.m.

Conservative

Pierre Poilievre Conservative Nepean—Carleton, ON

Point of order.

9:05 a.m.

Conservative

The Chair Conservative Merv Tweed

Mr. Poilievre, on a point of order.

9:05 a.m.

Conservative

Pierre Poilievre Conservative Nepean—Carleton, ON

I would like to move on with my questioning. My question was what the union was asking for very specifically from the Government of Canada, and he has not touched on that question so far. I'm wondering if I can move on to my next question.

9:05 a.m.

Conservative

The Chair Conservative Merv Tweed

I'll ask Mr. Atkinson to wrap up his comment, and then we'll go back to questions, please.

9:05 a.m.

President and Directing General Chairman, District Lodge 140, Mississauga, International Association of Machinists and Aerospace Workers in Canada

Chuck Atkinson

That's fine.

9:05 a.m.

Conservative

The Chair Conservative Merv Tweed

Mr. Poilievre.

9:05 a.m.

Conservative

Pierre Poilievre Conservative Nepean—Carleton, ON

We asked these same questions of the unionized and independent public servants at the justice department. They confirmed as well that Aveos is not mentioned in the Air Canada Public Participation Act, nor is your union, and therefore the act, according to these unionized public servants, does not oblige Aveos to continue operations, or the government to bail out Aveos.

According to Air Canada, both equity and debt contributions to Aveos over the last five years have reached $975 million, just under a billion. It appears Aveos has burned through that billion dollars and said that even if Air Canada gave an additional $15 million to try to keep it alive, it could not do so.

Given that we've established that there's nothing in the act that would force Aveos to continue operating, and that there's nothing in the act requiring that your union represent the employees, that leaves one option if we were to want to continue Aveos's operations, and that would be a bailout.

How much money do you believe a bailout would cost the Canadian taxpayers to keep Aveos functioning?

9:10 a.m.

President and Directing General Chairman, District Lodge 140, Mississauga, International Association of Machinists and Aerospace Workers in Canada

Chuck Atkinson

I don't think we're here asking for a bailout in any regard. We're asking for support from the government that at some point they would assist in getting someone else, another investor or operator that's interested in continuing the business of Aveos and moving forward so that our members who are out on the street have a future in a company that can carry on the business.

9:10 a.m.

Louis Erlichman Canadian Research Director, International Association of Machinists and Aerospace Workers in Canada

Could I say something?

I listened to some of the testimony from the Thursday hearing. I wasn't here. I'm impressed with this $975 million figure. It was suggested, and suggested again this morning, that Aveos received something like $975 million. What in fact happened, and I think it's what even Mr. Rovinescu said on Thursday, was that a majority of the company was sold in 2004--

9:10 a.m.

Conservative

Pierre Poilievre Conservative Nepean—Carleton, ON

First of all, I didn't pose the question to Mr. Erlichman. Second, his comments do not relate to my question whatsoever. So I'm going to move on--

9:10 a.m.

NDP

Olivia Chow NDP Trinity—Spadina, ON

Point of order.

9:10 a.m.

Conservative

The Chair Conservative Merv Tweed

Ms. Chow on a point of order.

9:10 a.m.

NDP

Olivia Chow NDP Trinity—Spadina, ON

This is quite unbelievable. Just look at last Thursday's meeting. We had Air Canada's CEO pass the question to Duncan Dee. At times in this committee when a person has felt that the question wasn't addressed and they wanted to give it to a colleague there has never been a problem.

If this is how it's going to operate from now on, I could also do the same. I just want the chair to rule. Is it up to the person who asked the question to specify exactly who the answer has to come from? If another colleague on the witness panel decides to answer the question and we choose not to hear from that person, are we able to do so? I just want to know if that is what you're going to rule. In the past, sometimes if I ask one person, person B has chosen to answer. Is that your ruling?

9:10 a.m.

Conservative

The Chair Conservative Merv Tweed

Individual members are entitled to ask the question of whoever they want. It's possible for other people at the table to answer, but because of the limited time of each member, at times members have said “I'd like to continue”.

9:10 a.m.

NDP

Olivia Chow NDP Trinity—Spadina, ON

“I want precisely that person”--okay. Thank you.

9:10 a.m.

Conservative

The Chair Conservative Merv Tweed

I will ask Mr. Poilievre to continue.

9:10 a.m.

Conservative

Pierre Poilievre Conservative Nepean—Carleton, ON

Mr. Atkinson, now you're saying you don't want a bailout, but during your statement you said, “While all of this has been unfolding, the federal government has stood by, making no effort to save this company...”.

You've conceded that there's nothing in the act that would save this company. That would leave a bailout, and you've now ruled that out as well. So what exactly are you asking the federal government to do?

9:15 a.m.

President and Directing General Chairman, District Lodge 140, Mississauga, International Association of Machinists and Aerospace Workers in Canada

Chuck Atkinson

I wouldn't say I've ruled out a bailout. I'm not sure what the government can do for us. The employment of 2,600 people should be of interest to even the Conservative government, and we should be worried about employment and jobs right across the country. We're asking for assistance from the government to make sure those people get jobs in the future.

9:15 a.m.

Conservative

Pierre Poilievre Conservative Nepean—Carleton, ON

So you accept that they will not be working with Aveos in the future.

9:15 a.m.

President and Directing General Chairman, District Lodge 140, Mississauga, International Association of Machinists and Aerospace Workers in Canada

Chuck Atkinson

I accept that Aveos is gone. I'm kind of glad they are gone, because they don't seem to be a very good company to work for.

9:15 a.m.

Conservative

Pierre Poilievre Conservative Nepean—Carleton, ON

Air Canada has said it will have to replace the contract work that was previously going to Aveos, and its preference is for the replacement provider to also employ Canadians. Does that provide you with any comfort?

9:15 a.m.

President and Directing General Chairman, District Lodge 140, Mississauga, International Association of Machinists and Aerospace Workers in Canada

Chuck Atkinson

It certainly does.

9:15 a.m.

Conservative

Pierre Poilievre Conservative Nepean—Carleton, ON

What form do you think that could take? Do you see a new company purchasing Aveos assets, hiring former Aveos employees, and continuing the operations to Air Canada and other clients potentially?

9:15 a.m.

President and Directing General Chairman, District Lodge 140, Mississauga, International Association of Machinists and Aerospace Workers in Canada

Chuck Atkinson

That would be our goal.

9:15 a.m.

Conservative

The Chair Conservative Merv Tweed

Thank you. I have to interrupt here.

Mr. Toet.

9:15 a.m.

Conservative

Lawrence Toet Conservative Elmwood—Transcona, MB

Thank you, Mr. Chair.

Thank you to our witnesses this morning.

I want to start by acknowledging that I am from Winnipeg and this has an impact on our community. The workers losing their jobs is devastating, and we take that seriously. We also have to act within the context of what we're able to do.

Is there recognition of the challenge that the airline industry, internationally and in North America, has faced over the last number of years? Is there recognition of that, from your perspective?

9:15 a.m.

President and Directing General Chairman, District Lodge 140, Mississauga, International Association of Machinists and Aerospace Workers in Canada

Chuck Atkinson

Yes. Over the last decade the employees at Air Canada and the ones who ended up at Aveos have made a number of sacrifices to make sure the airline kept going. Since the sale of the heavy maintenance division to Aveos we've been working with Air Canada and Aveos to try to make sure they continue operating in all of those cities.

It has been a difficult time in the industry, yes, no doubt.

9:15 a.m.

Conservative

Lawrence Toet Conservative Elmwood—Transcona, MB

Thank you.

Last week when Air Canada was here, I asked them directly what they see as opportunities as they go forward and possibly bring others to.... The assets are there for Aveos, as you've indicated. The facilities are there. Above all, the workforce is there. The skilled work labour pools are there in these centres. They indicated a desire to find somebody that would potentially be able to move into those facilities and continue going forward.

Are you also actively looking for those kinds of opportunities? Would you possibly even be willing to work alongside Air Canada in attracting somebody, an existing company, that may come forward and use those facilities in order to again create these opportunities and these jobs in Canada?

9:15 a.m.

President and Directing General Chairman, District Lodge 140, Mississauga, International Association of Machinists and Aerospace Workers in Canada

Chuck Atkinson

Yes, certainly.

9:15 a.m.

Conservative

Lawrence Toet Conservative Elmwood—Transcona, MB

Are you actively involved in that?

9:15 a.m.

President and Directing General Chairman, District Lodge 140, Mississauga, International Association of Machinists and Aerospace Workers in Canada

Chuck Atkinson

Yes, we are.

9:15 a.m.

Conservative

Lawrence Toet Conservative Elmwood—Transcona, MB

You are. So you would be very, very open to a new group. You actually indicated to Mr. Poilievre that to some degree you're happy to see Aveos go, so you'd be very open to another company coming forward and being part of the solution here.

9:15 a.m.

President and Directing General Chairman, District Lodge 140, Mississauga, International Association of Machinists and Aerospace Workers in Canada

Chuck Atkinson

Yes. As you've indicated, a solution, a long-term solution, is what we're looking for.

9:15 a.m.

Conservative

Lawrence Toet Conservative Elmwood—Transcona, MB

Yes. I think that's what everybody's looking for here. We want to see a long-term solution to this too.

I think the one thing that I've heard.... Some of the conspiracy theories scare me a little bit. You've shown in your presentation to us that it was sold for over $700 million, and to think that.... You have the ability through your group also to do some investments, and I'm sure you would not invest $700 million in order to get rid of a company. Would this be something you'd characterize as something you'd be involved in?

9:15 a.m.

President and Directing General Chairman, District Lodge 140, Mississauga, International Association of Machinists and Aerospace Workers in Canada

Chuck Atkinson

I couldn't comment on something like that at this time.

9:15 a.m.

Conservative

Lawrence Toet Conservative Elmwood—Transcona, MB

Okay.

The bottom line, I guess, and what I'm getting to here, is that things did go sideways and things went wrong. I think what we ought to do, though, is look to the future, go forward, and make sure that we get protection here, that we get jobs for these workers, and that we can get these facilities back up and going as soon as possible. I was very happy to hear of Air Canada's desire to also work in that vein to make sure that is going to happen.

I guess that's the one thing I want to get back to a little. It's Mr. Poilievre's questioning. You're asking us to do something, and I think we are happy to try to do something here to help this go forward. It would be helpful for us, though, if we had some concrete responses from you as to, you know.... Are there ways you see that we can work together with you to bring a solution to this?

9:20 a.m.

President and Directing General Chairman, District Lodge 140, Mississauga, International Association of Machinists and Aerospace Workers in Canada

Chuck Atkinson

I think what we'd like to see is to get all the parties together at some point to sit down and talk about those solutions. I mean, it's—

9:20 a.m.

Conservative

Lawrence Toet Conservative Elmwood—Transcona, MB

When you say “all the parties”, can you...?

9:20 a.m.

President and Directing General Chairman, District Lodge 140, Mississauga, International Association of Machinists and Aerospace Workers in Canada

Chuck Atkinson

Well, the government, Air Canada, the unions.... If there are investors out there that are looking to invest in the company, or if there's someone who can operate it, then it should be all of us together working to try to make sure that it happens.

9:20 a.m.

Conservative

Lawrence Toet Conservative Elmwood—Transcona, MB

And you are pursuing, from some of the reading I've done, opportunities for some possible investors?

9:20 a.m.

President and Directing General Chairman, District Lodge 140, Mississauga, International Association of Machinists and Aerospace Workers in Canada

9:20 a.m.

Conservative

Lawrence Toet Conservative Elmwood—Transcona, MB

You're getting a good response on that at this point in time?

9:20 a.m.

President and Directing General Chairman, District Lodge 140, Mississauga, International Association of Machinists and Aerospace Workers in Canada

Chuck Atkinson

It's early in the discussions, so at this point I can't say a whole lot about it.

9:20 a.m.

Conservative

Lawrence Toet Conservative Elmwood—Transcona, MB

Right. But you feel good about it, the potential...?

9:20 a.m.

President and Directing General Chairman, District Lodge 140, Mississauga, International Association of Machinists and Aerospace Workers in Canada

Chuck Atkinson

Well, at this point I'm not feeling real good about anything, because I still have so many people out of work—

9:20 a.m.

Conservative

Lawrence Toet Conservative Elmwood—Transcona, MB

Right.

9:20 a.m.

President and Directing General Chairman, District Lodge 140, Mississauga, International Association of Machinists and Aerospace Workers in Canada

Chuck Atkinson

—so it's a tough position.

9:20 a.m.

Conservative

Lawrence Toet Conservative Elmwood—Transcona, MB

Okay.

I also have one question regarding the announcement of the 2,600 jobs and the loss of them. In regard to those workers who have been trained and have those technical skills, from your conversations with them, is it their desire to start up again, to have a fresh beginning, and to have an opportunity to work in the centres and in the positions they're in?

9:20 a.m.

President and Directing General Chairman, District Lodge 140, Mississauga, International Association of Machinists and Aerospace Workers in Canada

Chuck Atkinson

Sure. The vast majority of them would like to do that.

As we talked about earlier, a decade of things being totally negative and a real trying time have definitely caused some people to start looking for other employment, which is one of our fears. If we don't do something quickly with this and move on, we will lose the people who have that technology and training, because they will have to move on to something else.

But to your question, yes, I think the majority of the people would be willing. It has been their life. It is what they've trained for and what they would like to continue doing.

9:20 a.m.

Conservative

Lawrence Toet Conservative Elmwood—Transcona, MB

Okay, but you're getting the sense that they're already finding other opportunities, then?

9:20 a.m.

President and Directing General Chairman, District Lodge 140, Mississauga, International Association of Machinists and Aerospace Workers in Canada

Chuck Atkinson

They have no choice, because they're not getting money from anywhere. They've obviously had to start looking for places for any type of work to pay their bills and keep their kids fed and clothed.

9:20 a.m.

Conservative

Lawrence Toet Conservative Elmwood—Transcona, MB

All right.

9:20 a.m.

Conservative

The Chair Conservative Merv Tweed

Thank you.

Before I recognize Ms. Chow, what's the average age of people in your organization? Are they all under 40? Over 40?

9:20 a.m.

President and Directing General Chairman, District Lodge 140, Mississauga, International Association of Machinists and Aerospace Workers in Canada

Chuck Atkinson

The Aveos group would probably be under 40 as a whole.

9:20 a.m.

Conservative

The Chair Conservative Merv Tweed

Okay. Good.

Ms. Chow.

9:20 a.m.

NDP

Olivia Chow NDP Trinity—Spadina, ON

It was only in January 2011 that the Canadian Industrial Relations Board recognized Aveos as a separate legal entity from Air Canada. All the workers came from Air Canada. Air Canada started branding in 2000 its maintenance, repair, and overhaul operations as a separate entity, and in 2004 transformed it into a dependent, legal entity. Then in 2007 they sold it off. In 2008 the new entity was rebranded as Aveos. So technically, the workers really belong to Air Canada.

I have a concrete proposal. I don't know whether you agree with it or not. Do you think the Government of Canada should tighten the Air Canada Public Participation Act to mandate Air Canada to rehire the 2,600 heavy-maintenance workers and also prevent Air Canada from sending jobs outside Canada? There's a debate right now whether the participation act is worth the paper it's written on.

Now, Chuck Strahl and all the various ministers, when they came in front of the committee and even in the House of Commons on March 2, 2011.... In answering the question of Thomas Mulcair, Minister of Transport Chuck Strahl said there would not be any job losses--Air Canada says it's going to maintain its overhaul centres in Winnipeg, Mississauga, and Montreal, so no job losses, a good thing, etc. So they promised the workers over and over again that the law was going to protect them. And they are now saying that the law doesn't protect them. Well, you can't have it both ways.

For ten years you said the law protected them, and now you say that it doesn't. Then should the law be amended to make sure that the workers get rehired by Air Canada and also prevent Air Canada from sending jobs outside, to the U.S.? Mr. Rovinescu sat at the seat over there where Mr. Atkinson is sitting, and I asked him precisely, and my colleagues also asked him, are you planning on sending some jobs to the U.S.? There was some dancing around; he said he didn't know, they may have to. We asked, how many? He wasn't sure.

I can just see it coming. A lot of the jobs that are highly trained, good-paying jobs are going to go down to the States.

Is that what you're asking the government to do? It wasn't clear in some of your answers. If the law doesn't protect you right now, change the law—is that what you're asking for?

Whoever wants to answer the question, whether it's Mr. Erlichman or Mr. Atkinson or Mr. Poirier....

9:25 a.m.

General Chairman, District Lodge 140, Montréal, International Association of Machinists and Aerospace Workers in Canada

Jean Poirier

Ms. Chow, you hit the nail on the head. Minister Flaherty said—not all the way back in 1988 but just last year—that Air Canada was complying with the act because Aveos was a subsidiary. Aveos was using Air Canada's facilities, but now it is no longer doing so. We are not going all the way back to 1988 but to about a year ago.

Mr. Pigeon, who provided the government with a legal opinion, said that we did not know. Yes, it is an overhaul centre, but Mr. Pigeon said in 2006, not in 2004, that Air Canada Technical Services, which had become a body separate from Air Canada, had to comply with the act. I can read to you what he said, if you like. I will give you a copy later.

9:25 a.m.

NDP

Olivia Chow NDP Trinity—Spadina, ON

I have it.

9:25 a.m.

General Chairman, District Lodge 140, Montréal, International Association of Machinists and Aerospace Workers in Canada

Jean Poirier

The government has a responsibility. Whether it be Aveos, Lufthansa Technik or any other company, Air Canada must guarantee the contracts. No investor is going to get involved if Air Canada does not guarantee that the contracts will go to these cities. It is in the spirit of the Act. The work must be done in these facilities.

9:25 a.m.

NDP

Olivia Chow NDP Trinity—Spadina, ON

Did Air Canada deliberately starve Aveos? There seems to be a dispute. Aveos said that you're not giving them the contracts for the work they have to do.

I understand that in 1988 Air Canada executives came in front of a House of Commons committee and said that its maintenance division was profitable. So it was making money. How do you run a company, which was making money when you received it, into the ground, at the end of the day?

Is it true that some of the contracts that should have been given to Aveos weren't given? That was one of the accusations. Was Air Canada deliberately trying to starve Aveos? Was that the case?

9:25 a.m.

General Chairman, District Lodge 140, Montréal, International Association of Machinists and Aerospace Workers in Canada

Jean Poirier

I will let my colleague from Winnipeg answer that question.

9:25 a.m.

Tony Didoshak General Chairman, District Lodge 140, Winnipeg, International Association of Machinists and Aerospace Workers in Canada

We attended quarterly meetings with Air Canada and Aveos that dealt with the scheduling of heavy maintenance programs throughout the year, in all three locations. During these meetings, we would set a Gantt chart, as it was called, which was the heavy maintenance schedule for the entire year. It would go from January to January, showing any gaps in the summer, because Air Canada would fly the aircraft in the summer.

As we proceeded through the beginning of this year, we noticed aircraft being changed and our Gantt chart meetings being more frequent. The more we showed up for meetings, the fewer aircraft showed up. I don't know what happened business-wise between Air Canada and Aveos, but I can tell you, from a scheduling point of view, that aircraft started to be removed from the Gantt charts, which meant that our workers, our employees, our members, had no work to do. Our members had no ability to do any aircraft, and the white space, as we called it, which was where no aircraft were available within the locations, started to grow. This led to the subsequent CCAA application of Aveos.

9:30 a.m.

Conservative

The Chair Conservative Merv Tweed

Thank you. I have to interrupt there.

Monsieur Gourde.

9:30 a.m.

Conservative

Jacques Gourde Conservative Lotbinière—Chutes-de-la-Chaudière, QC

Thank you, Mr. Chair.

Thank you to the witnesses for being here this morning. I will perhaps direct my remarks to Mr. Poirier and Mr. Brosseau.

On this side of the government, we are very aware of the loss of 2,600 jobs. We know that they are high level positions—if I am mistaken, please stop me and I will make any necessary corrections. We know that it is engineers and specialized workers.

I believe that you participated in a job fair this weekend to help some people.

9:30 a.m.

General Chairman, District Lodge 140, Montréal, International Association of Machinists and Aerospace Workers in Canada

Jean Poirier

I would just like to clarify that we did not organize the job fair. I believe it was organized by former Aveos managers. We are not the ones who organized it, and that is fine.

9:30 a.m.

Québec Coordinator, International Association of Machinists and Aerospace Workers in Canada

Gilles Brosseau

We also organized a job fair with the CAMAQ, which is coming up. The Centre d'adaptation de la main-d'oeuvre aérospatiale du Québec is going to organize a job fair with employers in need for our members who are not working. It is not to address the topic that we are talking about this morning.

We have people who are out on the streets who are not working. These people have families. It will take years for them to recover. This hinders future generations. No one will want to go to school to work in the aerospace industry. We must do something.

9:30 a.m.

Conservative

Jacques Gourde Conservative Lotbinière—Chutes-de-la-Chaudière, QC

We are willing to participate in any initiatives to help these workers. I agree with you.

We are talking about 2,600 workers in the aerospace repair industry. What percentage of all employees in this same industry do these 2,600 workers represent?

9:30 a.m.

Québec Coordinator, International Association of Machinists and Aerospace Workers in Canada

Gilles Brosseau

I can talk about Montreal, but I do not know about the other cities.

We know that Montreal is Canada's aerospace capital. With the closure of Aveos, a large part of that disappeared. We spoke briefly with the people at Aéro Montréal, which is Quebec's largest aerospace cluster. They too are feeling the effects of this loss.

9:30 a.m.

Conservative

Jacques Gourde Conservative Lotbinière—Chutes-de-la-Chaudière, QC

It is a lot of workers.

9:30 a.m.

Québec Coordinator, International Association of Machinists and Aerospace Workers in Canada

Gilles Brosseau

This affects many workers, as well as the qualification of potential workers and the future. The aerospace industry is one of Canada's high tech industries. We are good at this work and we have professionals in the field. We are—

9:30 a.m.

Conservative

Jacques Gourde Conservative Lotbinière—Chutes-de-la-Chaudière, QC

We will come back to that. It is fine. We are aware of that.

9:30 a.m.

Québec Coordinator, International Association of Machinists and Aerospace Workers in Canada

Gilles Brosseau

You understand what I am trying to say.

9:30 a.m.

General Chairman, District Lodge 140, Montréal, International Association of Machinists and Aerospace Workers in Canada

Jean Poirier

I would like to clarify one thing, Mr. Brosseau. You are talking about aerospace trades, but there is a difference between a certified technician who gets a licence from Transport Canada to fly an airplane—

9:30 a.m.

Conservative

Jacques Gourde Conservative Lotbinière—Chutes-de-la-Chaudière, QC

Okay. That is great.

9:30 a.m.

General Chairman, District Lodge 140, Montréal, International Association of Machinists and Aerospace Workers in Canada

Jean Poirier

—and someone who builds an airplane at Bombardier, for example.

With regard to the centralization of these qualified technicians, the 2,400 technicians that are leaving today represent the disappearance of perhaps 75% of all these occupations.

9:30 a.m.

Conservative

Jacques Gourde Conservative Lotbinière—Chutes-de-la-Chaudière, QC

We understand that it is a large part of the market. However, the work itself has not disappeared. It is Aveos that has disappeared. We are all aware of that.

9:30 a.m.

General Chairman, District Lodge 140, Montréal, International Association of Machinists and Aerospace Workers in Canada

Jean Poirier

In my opinion, the work has disappeared. I have planes that have gone to Rome, to New York, to TIMCO Aviation Services. I have others that are in Singapore and El Salvador.

9:30 a.m.

Conservative

Jacques Gourde Conservative Lotbinière—Chutes-de-la-Chaudière, QC

Excuse me, Mr. Poirier, but last week, a representative from Air Canada told us the opposite. He said that jobs would be kept in Canadian companies.

9:30 a.m.

General Chairman, District Lodge 140, Montréal, International Association of Machinists and Aerospace Workers in Canada

Jean Poirier

They are American facilities. I saw the same meeting of the Standing Committee on Transport.

9:30 a.m.

Conservative

Jacques Gourde Conservative Lotbinière—Chutes-de-la-Chaudière, QC

There are smaller companies. A new company could meet the demand, but can other Canadian suppliers replace Aveos?

9:30 a.m.

General Chairman, District Lodge 140, Montréal, International Association of Machinists and Aerospace Workers in Canada

Jean Poirier

I think that, with your help, there would be a way to talk to the people at Air Canada and to let them know that the companies have the tools and facilities. They may need a partner to survive. Everyone is talking about Lufthansa but it could be another company. Air Canada could perhaps guarantee that these jobs will be kept in these facilities with the help of a partner. The aircraft will be repaired and there will be guaranteed contracts. You could take the initiative to force Air Canada not to take the planes away from these cities.

9:30 a.m.

Conservative

Jacques Gourde Conservative Lotbinière—Chutes-de-la-Chaudière, QC

Would it be better for the 2,600 workers to be transferred to one company or to three or four separate companies, which would be more competitive for Air Canada?

In your opinion, what would be the best business model for the future?

9:30 a.m.

General Chairman, District Lodge 140, Montréal, International Association of Machinists and Aerospace Workers in Canada

Jean Poirier

Let us consider the maintenance, repair and overhaul centres in the world. Lufthansa Technik is a German company that is a subsidiary of Lufthansa. Right now, Air France does all its own maintenance. Air Canada's Boeing 777 engines are sent to Air France, where the three services are centralized: the company takes care of engines, the aircraft and their components. When you start separating these things, problems arise.

When a plane is brought to a hangar for a 21-day inspection, the engine is removed. The engine must be checked in a hangar reserved for that purpose, whereas some engine components are sent elsewhere.

When we talk about an overhaul centre, we are talking about three things: an engine maintenance centre, a components maintenance centre and a hangar. If the decision is made to take a piecemeal approach, suppliers will start to fight with each other. For example, the garage is located in a certain place but it costs too much for the engine and so the decision is made to send the engine to China to save money, but this causes the facilities in the original location to close. It all needs to be centralized.

What we want right now is to keep the jobs. We want to get people back to work. There is a federal law in this regard. Mr. Jeanniot, who was the president of Air Canada, very clearly explained that the overhaul centres are made up of engine maintenance centres, components maintenance centres and hangars. The tools are there. Everything is in place. All that needs to be done is to call the employees back to work. We are open to the idea of having another supplier help Air Canada do it but, for that to happen, we will need your help.

9:35 a.m.

Conservative

The Chair Conservative Merv Tweed

Thank you. I have to stop you there.

Ms. Morin.

9:35 a.m.

NDP

Isabelle Morin NDP Notre-Dame-de-Grâce—Lachine, QC

Thank you, Mr. Chair.

Last week, the president of Air Canada told us that, in terms of costs and productivity, Aveos was not a globally competitive business. However, in 1988, the then president of Air Canada said that the company was making a significant profit from its maintenance centres. He also said that Canadian workers were helping to create an effective work centre.

What has changed since 1988? How do you explain the fact that, in 1988, it appeared as though Aveos was effective and was going to succeed but, last week, it was said that this company is not competitive?

9:35 a.m.

General Chairman, District Lodge 140, Montréal, International Association of Machinists and Aerospace Workers in Canada

Jean Poirier

We do not have to look as far back as 1988. We can simply look at the situation that existed shortly before the sale. If you were to come and visit the hangars now, you would see that this is an excellent maintenance centre. The pilots say that it is the best in the world. Air Canada is very satisfied with our services. We are the ones who deliver the planes the most on schedule.

There is a game being played right now. Mr. Rovinescu is talking about a loss of a billion dollars but I think that it is actually $5 million that was given to shareholders over the past seven years. People need to stop saying that we have lost a billion dollars. It is being said that we are losing money when my order book and my engine maintenance centre are full, and we have even had to use subcontractors all year. My colleagues can confirm this. It does not make sense.

9:35 a.m.

NDP

Isabelle Morin NDP Notre-Dame-de-Grâce—Lachine, QC

Last week, when you demonstrated on Parliament Hill, I went and met with a number of workers. Oddly enough, they told me that, over the past few months, the company offered you a lot more training, equipment, coats and more.

9:35 a.m.

General Chairman, District Lodge 140, Montréal, International Association of Machinists and Aerospace Workers in Canada

Jean Poirier

It is sometimes said that the situation was planned in advance. In the beginning, Aveos was in all of Air Canada's facilities, but then Air Canada started renting its facilities to Aveos by square foot, and I can tell you that it charged an exorbitant price. Aveos therefore had no other choice but to move the components maintenance centre to another building, which cost a lot of money.

9:35 a.m.

NDP

Isabelle Morin NDP Notre-Dame-de-Grâce—Lachine, QC

I would like to come back to the question that my colleague asked earlier. In the beginning, you said that you were here because you want the federal government to intervene. You do not want to put the ball in anyone else's court. You want—

9:35 a.m.

General Chairman, District Lodge 140, Montréal, International Association of Machinists and Aerospace Workers in Canada

Jean Poirier

We want help. That is what we want.

9:35 a.m.

NDP

Isabelle Morin NDP Notre-Dame-de-Grâce—Lachine, QC

You want help but you are finding that the act, as it stands now, is not comprehensive enough to give you all the help you need. You want to change the act.

9:35 a.m.

General Chairman, District Lodge 140, Montréal, International Association of Machinists and Aerospace Workers in Canada

Jean Poirier

In my opinion, the act is clear. The spirit of the act is clear. Benoît Bouchard feels the same way as we do. He was the transport minister. The experts who came in 1988 said that, if someone wanted to sell these overhaul centres, then the act would have to be amended. The act has not been amended. For us, the act is clear. Legal opinions are being presented, but they depend on what side you are on. You can have a legal opinion say whatever you want.

Let us look at the Newbold ruling. Aveos was doing maintenance in its facilities. It was saying that it was respecting the spirit of the act, but Aveos is no longer there.

9:35 a.m.

NDP

Isabelle Morin NDP Notre-Dame-de-Grâce—Lachine, QC

For you, it does not matter whether or not you work for Aveos. What matters is that the jobs are kept in Montreal.

9:35 a.m.

General Chairman, District Lodge 140, Montréal, International Association of Machinists and Aerospace Workers in Canada

Jean Poirier

That is why I am telling you today that the spirit of the act must be respected. If a supplier wants to come in and buy the facilities, Air Canada must provide a guarantee that it will give its contracts to that supplier.

Right now, in the spirit of the act, the government must force Air Canada and tell Air Canada that it might need some help, that perhaps it is not capable of taking back most of the maintenance, that the provinces are prepared to invest, that the cities may be prepared to provide a tax break and that the federal government may be prepared to put some money into this. The federal government must also tell Air Canada that we will all help, that we will bring back the workers and that we will find a supplier that is prepared to keep this industry operational.

Everyone must return to work. We are here talking and nothing is happening. We have been talking about this for three weeks. The workers are still unable to obtain employment insurance benefits.

9:40 a.m.

NDP

Isabelle Morin NDP Notre-Dame-de-Grâce—Lachine, QC

I know. That is what you told me earlier. The employees do not have any money right now. We know that the government claims to be aware of this, but being aware of the problem is not enough. Action must be taken.

In your opinion, what steps must be taken in the next two or three days to remedy this situation?

9:40 a.m.

General Chairman, District Lodge 140, Montréal, International Association of Machinists and Aerospace Workers in Canada

Jean Poirier

Right now, we are really waiting for a saviour. There is no other word for it. We are waiting for someone who is really involved, who wants to get the maintenance, repair and overhaul sector going again with the best technicians in the world. We are not the only ones who are saying this.

9:40 a.m.

NDP

Isabelle Morin NDP Notre-Dame-de-Grâce—Lachine, QC

You met with the minister. What did he say to you during that meeting?

9:40 a.m.

General Chairman, District Lodge 140, Montréal, International Association of Machinists and Aerospace Workers in Canada

Jean Poirier

When I met with the minister, he first told me that he was looking into the situation. He must have told me that 20 times. He also told me that his door was still open.

9:40 a.m.

Liberal

Denis Coderre Liberal Bourassa, QC

He told you that he was aware of the situation.

9:40 a.m.

NDP

Isabelle Morin NDP Notre-Dame-de-Grâce—Lachine, QC

Yes. That is it. Surprise. Surprise.

9:40 a.m.

General Chairman, District Lodge 140, Montréal, International Association of Machinists and Aerospace Workers in Canada

Jean Poirier

Yes. He told me to leave my door open, so the door is open. I hope that your door is open to bring these workers back to work in the hangars, whether it be with the help of Lufthansa Technik, MTU or any of the other companies whose names have been thrown around but who, to date, have not shown any real interest.

Something has to happen. There is an urgent need. You are not the ones who are out in the street; I am, along with the workers. If you like, you can come with me. We can go and meet them. It may stir your emotions, if you have any.

9:40 a.m.

Conservative

The Chair Conservative Merv Tweed

Thank you.

Mr. Watson.

9:40 a.m.

Conservative

Jeff Watson Conservative Essex, ON

Thank you, Mr. Chair.

Thank you to our witnesses for appearing.

We appreciate the difficulty that families are facing, the workers you represent, and the challenges that still lie ahead with regard to securing the best outcome for workers.

I was a CAW Local 444 worker at Chrysler for a little over six years. I remember when the Pillette Road truck assembly plant closed. I was a junior employee with no seniority trying to raise a family, and I can appreciate that those are difficult moments.

Moving to the testimony here today and your written statement, maybe this is just a peculiar thing—I don't know whether it was intentional or not, and you can clarify that for me—but I notice in your statement you blame the government and Air Canada but Aveos is not mentioned anywhere in terms of blame, in terms of how it's operated as a company or anything like that. There is no responsibility attributed to Aveos. Are any of you implying somehow that Aveos is a victim?

Who would like to answer that? I see heads indicating no.

9:40 a.m.

President and Directing General Chairman, District Lodge 140, Mississauga, International Association of Machinists and Aerospace Workers in Canada

Chuck Atkinson

No, we definitely don't think that Aveos is a victim. It may just have been an oversight; I don't know.

9:40 a.m.

Conservative

Jeff Watson Conservative Essex, ON

Okay, fair enough.

Aveos had choices. They could have diversified their clientele base further to secure their future. In this difficult case where they decided to wind up operations they could have chosen restructuring over bankruptcy, for example. They chose the latter.

On the idea of restructuring, did Aveos inform you, the union, of Air Canada's offer of $15 million toward restructuring the operations? Were you informed of that?

9:40 a.m.

President and Directing General Chairman, District Lodge 140, Mississauga, International Association of Machinists and Aerospace Workers in Canada

Chuck Atkinson

Not until after the shutdown.

9:40 a.m.

Conservative

Jeff Watson Conservative Essex, ON

Okay, fair enough.

Was Aveos profitable as a company, and if so, in what years were they profitable?

9:40 a.m.

Christopher Hiscock President, Local Lodge 764, Richmond, International Association of Machinists and Aerospace Workers in Canada

I don't think there were ever profits.

9:40 a.m.

Conservative

Jeff Watson Conservative Essex, ON

Okay.

Mr. Didoshak, in your testimony, talking about quarterly meetings with Air Canada and Aveos, you mentioned that in the last year there has been a declining amount of work and almost left the impression that somehow one bad year is what made for bankruptcy at Aveos. That's not the case. In fact--

9:40 a.m.

General Chairman, District Lodge 140, Winnipeg, International Association of Machinists and Aerospace Workers in Canada

Tony Didoshak

That's not what I was saying at all.

9:40 a.m.

Conservative

Jeff Watson Conservative Essex, ON

I didn't say you were. It left the impression, is what I said. I just wanted to clarify that in fact they were having a bad run all the way along.

9:40 a.m.

General Chairman, District Lodge 140, Winnipeg, International Association of Machinists and Aerospace Workers in Canada

Tony Didoshak

Aveos, from what we've seen, was a money-spending business, not a money-generating business.

9:40 a.m.

Conservative

Jeff Watson Conservative Essex, ON

Did Aveos approach you and the union with respect to renegotiating labour contracts, opening them up, lowering labour costs?

9:45 a.m.

General Chairman, District Lodge 140, Winnipeg, International Association of Machinists and Aerospace Workers in Canada

Tony Didoshak

We were in the middle of bargaining when this occurred.

9:45 a.m.

Conservative

Jeff Watson Conservative Essex, ON

Did Aveos approach you at any point regarding ideas about diversifying its client base?

My understanding.... It's been reported, I think in the Montreal Gazette, that 90% of Aveos's maintenance came from Air Canada. That's a pretty risky business plan, if you ask me.

9:45 a.m.

General Chairman, District Lodge 140, Winnipeg, International Association of Machinists and Aerospace Workers in Canada

Tony Didoshak

Chuck and I and my colleagues had scheduled several meetings with Mr. Kolshak and his group, and strangely enough, prior to those meetings they were always cancelled. We never had the ability to speak with Mr. Kolshak in regard to any of that when he was in charge.

9:45 a.m.

Conservative

Jeff Watson Conservative Essex, ON

Okay.

9:45 a.m.

General Chairman, District Lodge 140, Winnipeg, International Association of Machinists and Aerospace Workers in Canada

Tony Didoshak

And yes, we had a concern about that.

9:45 a.m.

Conservative

Jeff Watson Conservative Essex, ON

I'm going to presume you had some ideas about how they could diversify their client base as well.

9:45 a.m.

General Chairman, District Lodge 140, Winnipeg, International Association of Machinists and Aerospace Workers in Canada

Tony Didoshak

Yes, we did.

9:45 a.m.

Conservative

Jeff Watson Conservative Essex, ON

I want to come back to the idea.... Your statement said that you were seeking assistance in saving Aveos. I understand that you've backed away from that statement, Mr. Atkinson, but I'm hearing some mixed messages.

Mr. Poirier, you've suggested that if Air Canada gets a partner and guarantees contracts, maybe we can get these workers back to work. That was the Aveos situation, right? They had long-term contracts, guaranteed to have workers in Winnipeg, Mississauga, and Montreal. What's to suggest that it could be different with a different partner? Would a new partner have a more diversified clientele base? What are you suggesting that would be different? That's what Aveos had.

9:45 a.m.

General Chairman, District Lodge 140, Montréal, International Association of Machinists and Aerospace Workers in Canada

Jean Poirier

I would like to give a few examples. It is being said that Aveos had a guaranteed contract with Air Canada for all of Air Canada's maintenance. That is true but only to a certain point. I told you earlier that Aveos did not invest any money in obtaining the maintenance contract for the whole fleet of Boeing 777 engines. The future of engine maintenance was in the 60 twin-engine Embraer aircraft, so Aveos never wanted to invest.

When two companies are business partners and they want to stay in business, work cannot be turned down. Yet, the planes were sent elsewhere even though we were capable of doing the maintenance. We have the expertise and we are the best in the world. Unfortunately, that is not what is happening right now.

9:45 a.m.

Conservative

Jeff Watson Conservative Essex, ON

Just to clarify, I didn't suggest that Aveos had all of Air Canada's maintenance. I'm suggesting that 90% of the maintenance that Aveos did came from Air Canada, which is a quantitatively different....

9:45 a.m.

General Chairman, District Lodge 140, Montréal, International Association of Machinists and Aerospace Workers in Canada

Jean Poirier

This figure has been thrown around but is there any evidence that 90% of the maintenance contracts were coming from Air Canada? That may have been the case for the aircraft in the hangars, but we were doing maintenance on other aircraft. National Defence—

9:45 a.m.

Conservative

Jeff Watson Conservative Essex, ON

How much of Aveos's maintenance came from other companies?

9:45 a.m.

General Chairman, District Lodge 140, Montréal, International Association of Machinists and Aerospace Workers in Canada

Jean Poirier

Let me answer your question, please.

We were doing maintenance on Air Transat planes. Many of the engine maintenance centre's contracts came from other companies.

We are talking about 90%, but I would like some evidence to back up that number because I do not believe that it is accurate.

9:45 a.m.

Conservative

The Chair Conservative Merv Tweed

I have to stop it there. I'm sorry.

9:45 a.m.

Conservative

Jeff Watson Conservative Essex, ON

I just said it was reported, that's all.

9:45 a.m.

Conservative

The Chair Conservative Merv Tweed

Mr. Sullivan.

9:45 a.m.

NDP

Mike Sullivan NDP York South—Weston, ON

Thank you, Mr. Chair.

I just want to go over some of what we've been told so far. First, the government will not let us question Aveos, so we can't indirectly through you ask these questions we're trying to ask about how Aveos managed to collapse. The government also won't let some of you talk when it comes to monetary issues.

The investors bought the equipment. The equipment still exists. So while the government is suggesting Aveos burned through $1 billion of money, that's actually not true, because the equipment still exists. Nobody burned through anything. They paid their employees a bunch of money over the course of however long they were there. Those investors are probably going to be first in line to get their money back, ahead of the employees. Certainly the employees have nothing at the moment, not even EI.

The minister got a legal opinion that runs contrary to everything the government has said. Both Liberal and Conservative governments since 1998 have all said it couldn't happen, that what just happened couldn't happen, wouldn't happen. Now the minister says “Oops--it happened.” Oops isn't good enough for you folks, or for the 2,600 people you represent. Oops is not acceptable to us, and it shouldn't be acceptable to the government.

The answer, clearly, appears to be that Air Canada has done everything it can to shed expensive labour. That's really what, to us on this side, seems to be going on. Air Canada's statement to us during the hearing on Thursday was that they signed a deal that was favourable to Aveos. If it's favourable to Aveos, it's not favourable to Air Canada. If it's not favourable to Air Canada, I'd want to get out of that deal as quickly as I could. So it makes sense that Air Canada would stop sending planes to Aveos in order to starve it. That appears to be what went on, but we'll never know, because the government won't let us question Aveos.

Now everybody here seems to be grasping at straws and asking, can we find another investor? Can we find another player to try to take over this equipment? The equipment is sitting there. Air Canada's not using it. Aveos isn't using it. The government is sitting on its hands, saying it's not our problem; it's a private issue between two private players. The law has no teeth. It has no meaning as far as the government is concerned, despite statements over many years that we shouldn't worry because this will never happen.

What should have happened when the government first became aware that Aveos was running into trouble with Air Canada and they told us not to worry, nothing will happen? What should the government have done to ensure that Air Canada lived up to the spirit of the law, which was that this work would stay in Canada, in Winnipeg, Mississauga, and Montreal?

9:50 a.m.

President, Local Lodge 764, Richmond, International Association of Machinists and Aerospace Workers in Canada

Christopher Hiscock

I'll speak to this a little bit and to a few other things.

One of the first questions asked by a member was why Aveos was not mentioned in the act and why the IAM was not mentioned in the act. I think that some of this questioning on where we are proved exactly what Aveos was created to do, and that was to become a little bit of a red herring and to do exactly what you suggested, which was to allow Air Canada to shed labour and labour costs.

I saw some media reports from some Air Canada executives last week that suggested they were willing to and would love to keep the work in Canada, but attached to that was a quote, “at globally competitive rates”. We understand that licensed aircraft engineers in Central America earn $500 a month. So for somebody working a 40-hour workweek in Canada, that equates to just over $3 an hour. I certainly hope Air Canada's not suggesting that that's what it would take to keep those jobs in Canada.

We view Aveos's Air Canada maintenance as a turnkey operation. You've hit it exactly. The facilities are there. The workers are there. The skills are there. All it needs is a willingness for somebody to go in, unlock the door, and turn on the lights. It would take literally 72 hours to get this operation up and running, to get these people back to work doing this maintenance.

Essentially we have come here looking for leadership from the government on an issue, and the government is the sole entity in Canada that has responsibility for making that happen. Air Canada is a federally regulated transport carrier. It is the national airline. It was a crown corporation. It was privatized under the Public Participation Act. The spirit of that act and intent of that act were to make it an airline that worked for Canada and that had Canadians working for it, and that is why we are here.

9:50 a.m.

Conservative

The Chair Conservative Merv Tweed

Thank you.

Mr. Adler.

9:50 a.m.

Conservative

Mark Adler Conservative York Centre, ON

Thank you, Mr. Chair.

I want to thank all of the witnesses for being here today. I know this can't be an easy time for any of you, or for your membership. But I just want you to know—and I'm sure I can speak on behalf of all members—that any job loss in this country is one too many. That's why we, as a government, have a plan in place to create jobs and economic growth and long-term prosperity. I just want to say that.

You indicated in your remarks that you have been in touch with other levels of government in your effort to come to an equitable resolution to all of this. What kinds of discussions have taken place, and what have they produced, if anything?

9:50 a.m.

President, Local Lodge 764, Richmond, International Association of Machinists and Aerospace Workers in Canada

Christopher Hiscock

I was in Victoria on Tuesday with a delegation of 57 of our members. We met with both the official opposition and the B.C. Liberal government. The message we got is that this is an important issue for British Columbia and for Canada, and that this has to be done in a non-partisan way. We weren't interested in going to Victoria to get into politics with the Liberals, the NDP, or the Conservatives. This is something all the parties have to rise above. We were simply looking to put the stakeholders together and work towards a solution.

We asked for the support of the government. We felt it was especially significant in British Columbia, because Vancouver is not mentioned specifically in the Air Canada Public Participation Act. When Air Canada was privatized, Vancouver was the main base for Canadian Airlines.

9:55 a.m.

Conservative

Mark Adler Conservative York Centre, ON

I apologize, but—

9:55 a.m.

President, Local Lodge 764, Richmond, International Association of Machinists and Aerospace Workers in Canada

Christopher Hiscock

I'll cut it short.

9:55 a.m.

Conservative

Mark Adler Conservative York Centre, ON

Were there any substantive proposals that came forward?

9:55 a.m.

President, Local Lodge 764, Richmond, International Association of Machinists and Aerospace Workers in Canada

Christopher Hiscock

We didn't have substantive proposals. We asked would they come to Ottawa and work with us and the federal government to try to get a national solution. The commitment we got from the 83 MLAs in Victoria was that they would.

9:55 a.m.

Conservative

Mark Adler Conservative York Centre, ON

Has the union considered buying into the company?

9:55 a.m.

President, Local Lodge 764, Richmond, International Association of Machinists and Aerospace Workers in Canada

Christopher Hiscock

No, but this was also a question asked by the Government of British Columbia. We haven't gone that far down any particular road, but we don't rule out any situation. We simply want to get people together. There has to be a solution. I refuse to believe that there is not a solution that will make this work. So I don't rule anything out. Everything would have to be looked at in context.

9:55 a.m.

Conservative

Mark Adler Conservative York Centre, ON

At the time that Aveos was spun off from Air Canada, was your bargaining unit in favour of that or against it?

9:55 a.m.

President, Local Lodge 764, Richmond, International Association of Machinists and Aerospace Workers in Canada

Christopher Hiscock

We were 100% opposed.

9:55 a.m.

Conservative

Mark Adler Conservative York Centre, ON

Okay.

9:55 a.m.

President, Local Lodge 764, Richmond, International Association of Machinists and Aerospace Workers in Canada

Christopher Hiscock

We foresaw exactly what has happened today. We foresaw this as a chance to get rid of our members—their benefits, their pensions—and to ultimately push them aside.

9:55 a.m.

Conservative

Mark Adler Conservative York Centre, ON

If you were the federal Minister of Transport, I wonder what your solution would be. If you could make a ruling right now, what would it be?

9:55 a.m.

President, Local Lodge 764, Richmond, International Association of Machinists and Aerospace Workers in Canada

Christopher Hiscock

Originally we talked about legal opinions. Legal opinions are all over the map. I think some of the members on the committee had a valid point about making the law say what it was supposed to say, to beef it up.

This, to us, is simply about keeping Canadian expertise, Canadian jobs, and Canadian work in Canada. I don't want to get tied up in the ideology of what's a corporate name, or if there is a union representing the workers. There are 2,600 families who woke up this morning wondering how they're going to feed their kids and pay their mortgages. That is our prime concern and that's why we're here.

Time is of the essence. Workers need to be paid, facilities are sitting idle while things are being tied up in bankruptcy courts. We view this as a turnkey operation. So the sooner we can turn the lights back on and get people back to work, the better it is for everybody, including Air Canada.

9:55 a.m.

Conservative

Mark Adler Conservative York Centre, ON

You mentioned that a bailout would be one option, and I understand that. But should the government be there to bail out every private company whenever, through mismanagement or whatever reason, a lot of workers happen to be displaced? Should that be the number-one priority?

9:55 a.m.

President, Local Lodge 764, Richmond, International Association of Machinists and Aerospace Workers in Canada

Christopher Hiscock

We're not looking for a bailout. In my opinion, that's not why we came here. We're simply looking to get a business climate and for the government to facilitate to the extent it can to make this work for all the parties. From what I understand from the Conservative agenda, it is a business-friendly party and that is what it wants to do.

As I said, there has to be a solution within this country. I refuse to believe that we're not smart enough in this country to figure out how to do this work in Canada. It's been done for 75 years; we didn't lose this ability in six months.

9:55 a.m.

Conservative

The Chair Conservative Merv Tweed

Mr. Holder.

9:55 a.m.

Conservative

Ed Holder Conservative London West, ON

Mr. Chair, I'd like to thank our guests for attending this morning.

I want to add my comments. I know that we all feel around this table the empathy for the 2,600 employees and their families and frankly about the spinoff jobs that go outside of that as well. I think we all appreciate that. In my own city, that has certainly happened. Any time any company fails, it isn't just the company, obviously; it's clearly the employees and the spinoff work. It isn't just the union jobs; it's the management jobs, the non-management jobs, and all the others that are impacted by feeder organizations in those communities.

Your hearts can't not go out to those people. I want to make that very clear. This is an interesting discussion, interesting from the standpoint.... I'm not sure if I want to call it “mixed messages”, but I'm a little confused.

Mr. Hiscock, in some of your testimony earlier you said just unlock the door and turn on the lights. You indicated that this is a turnkey operation and to the extent that equipment is all in good repair and in order, which it presumably is, within 72 hours it could be operational again. As a person with some business background, I'd say if it were only that easy to do it just that way. I'm certainly not talking about the technical aspect of unlocking the door, but there is the other aspect. There's the part where it's important that we keep employees working, but it's important that a company needs to make money to do that.

One of you indicated, I think it was Mr. Hiscock, that they were never profitable. I guess when I look at the investment that they made.... I have to believe that Aveos as a company initially acted in good faith to try to create a profitable organization. If it's not profitable, you can't sustain yourself. In business, just like a budget, we all understand that.

Could you presume that any company that would invest in the assets of this organization, with the labour force that's there and the markets that are there, could be profitable? How long do you think it would take to get to profitability?

10 a.m.

President, Local Lodge 764, Richmond, International Association of Machinists and Aerospace Workers in Canada

Christopher Hiscock

You're way outside of my area of expertise in terms of corporate profitability, but I believe that the elements are there to make a successful company.

10 a.m.

Conservative

Ed Holder Conservative London West, ON

I'm sorry, could you say that again? I apologize.

10 a.m.

President, Local Lodge 764, Richmond, International Association of Machinists and Aerospace Workers in Canada

Christopher Hiscock

I believe the elements are all there to make a successful company. I think that a lot of where this needs to go is that there needs to be a properly managed and properly run company. That's been our opinion for quite some time, simply with the dealings we've had with the management group that has been in place.

10 a.m.

Conservative

Ed Holder Conservative London West, ON

Mr. Didoshak, you indicated that the union had ideas as to how Aveos could have diversified its business when it was operational. Could you clarify and help us understand what some of those ideas could have been?

10 a.m.

General Chairman, District Lodge 140, Winnipeg, International Association of Machinists and Aerospace Workers in Canada

Tony Didoshak

One of the ideas we had was work role changes that we could have implemented at the time. But prior to doing something like that, you have to understand the expenses that Aveos had.

When we spoke to Aveos management prior to them filing for CCAA, they had advised us that they were paying exorbitant amounts of rent to Air Canada in regard to the facilities they were using. The number given to me in Winnipeg was $380,000 a month for the hangar. You can do the math on what $380,000 a month would be, which would precipitate the $95-per-hour labour cost that Aveos was charging back to Air Canada.

If you take that cost away, or at least minimize the cost to a reasonable level, then you could go out and actually find companies out there that would be willing to bring work in at a lesser rate. Air Canada told us this when it had ACTS, and Aveos has told us that if they could get their rates down to $60 an hour they could attract third-party business.

10 a.m.

Conservative

Ed Holder Conservative London West, ON

To be candid, if I might, because I appreciate learning through you, did they ever talk with you about the cost of labour as one of their issues they had to deal with?

10 a.m.

General Chairman, District Lodge 140, Winnipeg, International Association of Machinists and Aerospace Workers in Canada

Tony Didoshak

Every company talks about the cost of labour as being an issue. The cost of labour was not—

10 a.m.

Conservative

Ed Holder Conservative London West, ON

But you indicated there was another issue. You talked about hangar costs as well.

10 a.m.

General Chairman, District Lodge 140, Winnipeg, International Association of Machinists and Aerospace Workers in Canada

Tony Didoshak

Hangar costs were exorbitant expenses. One of the things that I noticed with Aveos, when they purchased their ACTS from Air Canada, was the money flow they had for implementation of new purchasing processes, new computer programs, lean management programs that they launched. The money flowing out of there was quite substantial.

10 a.m.

Conservative

Ed Holder Conservative London West, ON

If I'm correct, the moneys that Aveos received were from investors who would have been reasonably sophisticated, I would have thought--larger financial institutions. Certainly we heard that in some testimony from Mr. Rovinescu last week.

Again, I come back to my business background. I have bought and sold companies, but I do that with eyes wide open. It strikes me that Aveos would have done the same thing. So it's interesting that they make these comments to you on their way out. I'm just surprised that this would never have been considered. I would find that highly irregular for any business, especially an investor-based business that would go into that kind of enterprise without having eyes wide open. It strikes me, clearly, from my experience—and these people do not seem like unsophisticated investors—that this is how they would have done it.

Can I ask a question about your current employee group, please? Was 2,600 employees the exact number of employees when Aveos bought that division?

10:05 a.m.

General Chairman, District Lodge 140, Winnipeg, International Association of Machinists and Aerospace Workers in Canada

10:05 a.m.

Conservative

Ed Holder Conservative London West, ON

How many employees were there at the time?

10:05 a.m.

General Chairman, District Lodge 140, Winnipeg, International Association of Machinists and Aerospace Workers in Canada

Tony Didoshak

I can only speak for Winnipeg, because I don't know—

10:05 a.m.

Conservative

Ed Holder Conservative London West, ON

I'm trying to get a global—

10:05 a.m.

General Chairman, District Lodge 140, Winnipeg, International Association of Machinists and Aerospace Workers in Canada

Tony Didoshak

—how it was reduced nationally. I'll let Brother Poirier talk about Quebec.

10:05 a.m.

Conservative

Ed Holder Conservative London West, ON

Mr. Poirier, do you know the...? Okay.

10:05 a.m.

General Chairman, District Lodge 140, Winnipeg, International Association of Machinists and Aerospace Workers in Canada

Tony Didoshak

In Winnipeg, we started with over 600 employees within the maintenance base when ACTS existed, when it was sold to Aveos. We were down to 330 unionized mechanics when they went bankrupt. So we lost half our workforce within just a couple of years of Aveos purchasing ACTS.

10:05 a.m.

Conservative

Ed Holder Conservative London West, ON

Can I ask—

10:05 a.m.

Conservative

The Chair Conservative Merv Tweed

I have to stop.... I'll ask Mr. Poirier to complete the answer, and then we have to move on.

Mr. Poirier.

10:05 a.m.

General Chairman, District Lodge 140, Montréal, International Association of Machinists and Aerospace Workers in Canada

Jean Poirier

Personally, I like to paint a clear picture for everyone. What my colleague from Winnipeg said is true: the number of people has dropped over the years.

You talked about viability. In 2003, Air Canada Maintenance or ACTS—call it whatever you want—was totally viable. In 2007, when it was sold, it was still viable, because it was sold for over $700 million.

The employees have not had a pay raise since 2003. Their benefits have not improved. Their productivity increased because the number of workers decreased. So don’t tell me that the company isn’t viable. More like some people cashed in and then took off.

Aveos's management structure was unbelievable. There were so many people in that department. I think that there were more people in management than on the shop floor at one point.

It is definitely a viable company. People made sacrifices, and once again, the employees are bearing the brunt of things. They have been kicked out into the street, while some people might have taken off with buckets of money

Are we a viable company? Yes, we are. Nobody can tell me otherwise.

10:05 a.m.

Conservative

The Chair Conservative Merv Tweed

Thank you.

That completes the first round. I'm going to open up the floor for another round of five minutes.

I'll start with Mr. Nicholls.

10:05 a.m.

NDP

Jamie Nicholls NDP Vaudreuil—Soulanges, QC

What I'm going to take away from this meeting today is an idea of what the Conservative strategy for jobs is, and that's learn to speak Spanish or Chinese, buy a plane ticket, and say “Adios”.

How can a Canadian worker compete with $3 an hour or $2 an hour, or however much they pay in El Salvador or China? It takes government support to support our industry. We look at EMD: it went to the States. It had U.S. government support. The pay that they were getting in Canada got cut in half. Now, if our government had been willing to support EMD, maybe we would have been able to keep those jobs here.

I don't see this government supporting any workers in Canada. Frankly, the more evidence I see from this government, I see that it's interested in union busting, clearly.

This is the largest single loss in the aerospace industry since the demise of the Avro Arrow. Just coincidentally, the replica of the Avro Arrow is being turfed out of a museum right now.

It doesn't seem to me that the Conservatives want an industrial strategy at all. These people who were employed with Aveos spent money in their communities. They paid their taxes, they raised their kids, they raised their families, and they built local economies. Those are the people who build local economies, not a bunch of managers who put their money offshore, who don't even live on Canadian soil.

If we look at innovation, you are the innovators here. You're the practical side of the ideas application. You're doing the work on the ground. The government's job is to prepare the playing field for you, and we've seen that they've clearly failed at doing that. If you look at even the World Economic Forum, we see Canada's ranking dropping every year in terms of their competitiveness with regard to innovation. You are the innovators. And now we see that dropping further.

Now, the government is trying to roll out a plan regarding innovation, but as far as I'm concerned, it's too little, too late. They haven't been looking at the indicators and I'm not sure if their plan is going to work, especially with the Minister of Finance busy attacking the Premier of Ontario.

You got to the key there: you said mismanagement. Well, this government's being mismanaged. You talked about the top managers screwing over the people on the bottom. Well, that's what this government is doing.

Don't you agree with that? Don't you agree that this is clearly an exercise in union busting? And if it doesn't stop today, if we don't stop this union busting, it's just going to continue within each sector of the country, and unionized workers are going to be screwed over by this government.

10:10 a.m.

Conservative

The Chair Conservative Merv Tweed

Excuse me. Mr. Watson has a point of order.

10:10 a.m.

Conservative

Jeff Watson Conservative Essex, ON

I'm just not sure that the language of the honourable member is very parliamentary with respect to the government or government members. I think that should be withdrawn, and something a little more parliamentary used instead.

10:10 a.m.

NDP

Jamie Nicholls NDP Vaudreuil—Soulanges, QC

Well, Mr. Chair—

10:10 a.m.

Conservative

The Chair Conservative Merv Tweed

Mr. Nicholls, on the same point of order.

10:10 a.m.

NDP

Jamie Nicholls NDP Vaudreuil—Soulanges, QC

Mr. Chair, you had no problem last week with the word “shafted”, which was used by the member from Winnipeg North, when he said “shafted” about 12 times. I believe “screwed over” is the equivalent to “shafted”. I believe that “screwed over” and “shafted” are basically synonyms. If you looked in a thesaurus, you would see that “screwed over” has basically the same meaning.

10:10 a.m.

Conservative

The Chair Conservative Merv Tweed

Mr. Holder, on the same point of order.

10:10 a.m.

Conservative

Ed Holder Conservative London West, ON

Chair, it's interesting. I believe I'm the newest member to this committee. I would say that what I've been blessed with in prior committees I've sat on is we can raise the level of debate and dialogue among our colleagues. So I would just encourage my colleague opposite to keep the level of parliamentary discourse at the highest level, which I know he can do.

10:10 a.m.

An hon. member

Hear, hear.

10:10 a.m.

Conservative

The Chair Conservative Merv Tweed

I'm going to rule that it's not a point of order. But I do ask all members to choose your words carefully. We are seen as leaders of our country, and I think some of our language, at times, is inappropriate.

Mr. Nicholls asked a question, and I'll ask for a response, please, from whoever wants to take it.

10:10 a.m.

President, Local Lodge 764, Richmond, International Association of Machinists and Aerospace Workers in Canada

Christopher Hiscock

I'm not even sure what the question was any more.

10:10 a.m.

Voices

Oh, oh!

10:10 a.m.

Conservative

The Chair Conservative Merv Tweed

That's quite often how this situation works.

Mr. Nicholls, would you like to repeat your question very briefly?

10:10 a.m.

President, Local Lodge 764, Richmond, International Association of Machinists and Aerospace Workers in Canada

Christopher Hiscock

I think if I were responding to a question on union busting, I probably would also be subject to a point of order, so perhaps it's best I don't.

10:10 a.m.

Conservative

The Chair Conservative Merv Tweed

You have a minute and a half.

10:10 a.m.

NDP

Jamie Nicholls NDP Vaudreuil—Soulanges, QC

Perhaps I should have used the words “fuddle duddle”. They're fuddle-duddling the workers here.

My question was whether you see this as an exercise in union busting. If the government doesn't act here to provide you with some sort of aid, does it not send a signal to other workers that the government is not going to lift a finger to help the workers of this country?

10:10 a.m.

General Chairman, District Lodge 140, Montréal, International Association of Machinists and Aerospace Workers in Canada

Jean Poirier

I believe that the GM workers were unionized, yet the Conservative government pitched in to save 3,000 jobs in Ontario. I talked to Minister Lebel, who told me that it was a partnership with the Obama administration to save those jobs.

I don’t know if it’s because Air Canada is just a Canadian company and the Americans are not involved. Regardless, the government did it for GM. It also blocked the sale of PotashCorp. I believe that the Conservative government can help unions. I think that it can pitch in now. I think that it might listen to us and that it might do something about the situation by presenting a report to the House of Commons. From what I've heard, today’s discussion will not be passed on to the House of Commons. I would like them to reconsider the decision. Something has to happen.

As to whether there is any union-busting going on, I think it is important to point out everything that unions have created. Status of Women Canada exists thanks to unions. The 40-hour work week exists thanks to unions. Child labour no longer exists thanks to unions. Unions are here for a reason. Managers should not be the only ones involved in making decisions. Without unions, I don’t know what kind of working conditions we would have today.

10:10 a.m.

Conservative

The Chair Conservative Merv Tweed

Thank you.

Mr. Coderre, over to you.

10:10 a.m.

Liberal

Denis Coderre Liberal Bourassa, QC

Mr. Chair, if we got started on curse words in French, we’d be here forever. I won't list them all because it would take longer than five minutes. That being said, I'm having a hell of a time with what's going on here today. I think people are trying to dodge the issue. The Conservatives say that they really do care. They say that they care about the fact that you have lost your jobs. The problem is that they are not only killing an industry, but they are also completely disregarding the spirit of the law. The problem is Air Canada. Aveos screwed you, but the problem is still Air Canada.

If I were from Windsor, sure I’d be happy to know that there’s going to be a new hangar that will hire non-unionized workers. As a guy from Montreal, I’m seeing 2,600 jobs lost. And I’m dealing with a government that doesn’t care about the law and doesn’t care about making Air Canada comply with the law. We've got to wake up. This is not just about figuring out what to do with Aveos. I want to protect your jobs and make sure that when a law goes through Parliament, it actually gets enforced. That takes commitment from politicians and the courts. That's why I find that you're soft-pedalling the issue this morning. I mean that with all due respect.

Obviously, we have to protect jobs. We have to find a way to help the employees find work because some of them have not been paid in three weeks. But the union’s primary responsibility is to take the company to court to defend the workers' interests. Mayors and governments of the cities and provinces affected by this have said that they will support you. I hope that you will work on this, get it done and stop beating around the bush.

We know that the Minister of Transport doesn’t want to do his job because the real Minister of Transport is the Prime Minister, who uses the private sector whenever it suits him. He wants to trample on your rights as workers by imposing big-stick legislation to force people back to work. In the meantime, you are still out of a job.

It's the same thing for Winnipeg. We also have to work for the people in Vancouver. Within the law, the spirit of the law, it's about protecting Mississauga, Montreal, and Winnipeg. So we have to do something about that.

So what's your one-two punch?

I hope that the minister, of course, will be able to give you a hand with employment insurance. That also reminds me that there are a lot of people who didn't receive their cheques because there are not enough officials there to work out the process, so you can get the cheques. That's another issue; that's another problem.

Mr. Atkinson, since you're the big cheese today of the union, what do you intend to do? I want the politicians to do their jobs. Of course we won't have a report, but this is televised, so somebody will be listening. But at the same time, what's your timeframe to sue Air Canada?

10:15 a.m.

President and Directing General Chairman, District Lodge 140, Mississauga, International Association of Machinists and Aerospace Workers in Canada

Chuck Atkinson

That process has already started with our legal people. Any legal process now seems to take forever and ever. Realistically, the reasons why we're here, and what I'm hearing today from both sides here.... It really concerns me. As the chairman pointed out, these are the leaders of the country here, who are supposed to be looking after all of our citizens, and all I'm hearing from the Conservative side is pass the buck, let's deflect, let's talk about how come Air Canada or Aveos is not put into the Air Canada act, and how come the IAM is not in the Air Canada act.... There's no real.... There's nothing coming back from the Conservative side of the House on what we are going to do about it.

We hear that there's a job plan going forward, but my members don't see that. My members are out on the street. As you've heard from all of my confreres here, there's very little that would be needed to get those members back to work. It seems that all we're hearing is “Well, it's someone else's fault, and we can't do anything about this”. That, to me, is not a good answer.

10:15 a.m.

Liberal

Denis Coderre Liberal Bourassa, QC

Mr. Atkinson, the government says that we have to deal with our own problems. In last Thursday’s budget, it told everyone to deal with their own problems.

What worries me most is that even if we pass a law, that doesn’t mean anyone has to comply with either the letter or the spirit of that law. We have to find another way. Sooner or later, there will be lots of cases like this one with Aveos. I think that we have to be able to walk and chew gum at the same time. We have to find a way to protect jobs and maintenance centres, because this is about the industry and the issues the unions are facing within companies. I am not a militant unionist, but I believe that workers have rights. Unions exist for a reason. We have to find the right balance.

I humbly suggest—I can certainly be humble—

find a way.

And we are pushing. I've been there since day one. We're all pushing, but it's not only about Aveos. It's about the future of our aerospace. It's about our future.

Right now we have a hangar in Windsor, and it seems that the law cannot be respected; they're going to give away jobs there. They're going to give the jobs away. They're going to clean out Montreal. Then what? Well, let's go to the United States, because in the States they have all the certificates, and we'll go there.

You have to keep putting the pressure on even though the government has a majority. You have to quit passing the puck around. The union has to say that it will go to court and that it has support from the provincial governments and the opposition.

This is not about changing the law. This is about making sure the law is obeyed. Personally, I am disappointed that the NDP members are talking about whether the law should be changed. Why not start by enforcing and obeying the law? We would only change the law if people were obeying it, but it was not working.

10:20 a.m.

General Chairman, District Lodge 140, Montréal, International Association of Machinists and Aerospace Workers in Canada

Jean Poirier

Mr. Coderre, I would take that even further: the entire federal legislative system should be up for discussion. Nothing is happening. You were absolutely right when you said that nobody is obeying the spirit of the law. These laws are passed democratically. Now they’re telling Canadians that even if the government passes a law, it can change its mind. That’s what they’re doing.

Today we’re talking about the Air Canada Public Participation Act with respect to the maintenance centres, but tomorrow morning, we'll be talking about another law. The government is telling people that laws passed in Canada don’t really mean anything.

Last week, I said that if I robbed a bank, they’d take me away in handcuffs. But now the company is breaking the law, yet nobody is being arrested.

I completely agree with you.

10:20 a.m.

Conservative

The Chair Conservative Merv Tweed

Thank you.

With that, I'll thank our guests today for being here. We do appreciate your input. Hopefully a solution can be found very quickly. Thank you again for your time.

I have some advice for committee members. Because of the change of schedule and Friday is now Thursday, there will be no committee meeting on Thursday.

The meeting is adjourned.