Transport Committee on March 8th, 2011

[Michel Guimond, Bloc, Montmorency—Charlevoix—Haute-Côte-Nord, QC]

I don't know whether you were present during Ms. Sénécal's testimony or whether you have the committee "blues". Ms. Sénécal, who is legal counsel, and I am not questioning her competence here, but I think she tried to pull a fast one on us in her answer, said that Air Canada did not need employees in its overhaul centres to comply with the act. Do you agree with that statement?

In other words, someone could be twiddling their thumbs in Winnipeg and Mississauga and Montreal, and they would say we don't need employees in our overhaul centres. What do you think of Ms. Sénécal's answer?

[Serge Gélinas]

We flatly disagree with the answer Ms. Sénécal gave. What she said is false.

Let's go back to 1988. I will quote two statements by people who were involved in drafting the act. First, Jim Hawkes said that "the employees' work environment, their benefits, their future, all of that is guaranteed".

So that is the first job guarantee.

Next, I will quote Mr. Mazankowski on the question of job guarantees. He said:

Some have suggested there should be further guarantees as to the level of employment at these Centres. May I simply remind the Committee that there are no such guarantees now, nor are there any existing guarantees concerning the existence of these major Centres in today’s Air Canada Act. So in effect, this legislation provides guarantees that did not exist before.

In 1988, those people told us that the jobs are guaranteed today.

As well, on the question of jobs, you have to understand that we don't have minimum employment levels, like in Montreal or other cities, but a guaranteed employment level. That means that if Air Canada is going well, the company buys more planes. If more planes are bought, more maintenance will be done, so the company needs more mechanics to do the maintenance. But if Air Canada is not going so well, the company buys fewer planes and so it needs fewer mechanics. That is why we talk about a level and not a minimum. The act is clear on that point, however. It is Air Canada employees that must do repairs on Air Canada planes, not employees in El Salvador. The repairs have to be done by Air Canada employees in Canada.

[Michel Guimond, Bloc, Montmorency—Charlevoix—Haute-Côte-Nord, QC]

In response to a question I asked, Ms. Sénécal told me that Air Canada had no intention of doing business with Aeroman. I asked her why and she answered: "Because I'm telling you." It was as if she were saying: "If I tell you, it's the truth." I don't want to call her a liar. The reason she gave is that Aeroman doesn't have certification to do maintenance for large carriers. We MPs don't know anything about this, because we come from different worlds. But you are experts.

Was she right about Aeroman? Is the company in fact not competent? How much time might it take for it to become competent at this?

[Marcel St-Jean, President, International Association of Machinists and Aerospace Workers - Local lodge 1751]

Saying that Aeroman doesn't do maintenance for large carriers is false, and we have the proof. On Aeroman's Internet site, in El Salvador, it says that the company maintains Boeing 737, 757s and 767s, and Airbus A320s. The company works for large carriers.

[Michel Guimond, Bloc, Montmorency—Charlevoix—Haute-Côte-Nord, QC]

Are these planes that you handle?

[Marcel St-Jean]

Yes, exactly.

[The Chair, Conservative, Merv Tweed]

I'll ask you to finish your answer, and then we have to go to Mr. Bevington.

[Marcel St-Jean]

At this time, TACA in El Salvador could do 87% of the maintenance on Air Canada planes. That company has the capacity to do it. And it is continuing to build new hangers, day by day.

At present, Air Canada and Aeroman are already doing business. At this time, parts are already being sent to El Salvador from Air Canada for maintenance there. They are "heat exchangers". It isn't going to be done in the future, it's the fact now. That is the proof that Ms. Sénécal lied to us. In El Salvador, Aeroman is already maintaining Boeing 767s.

When Mr. Bolouri took over Aveos in 2007, he was very clear about the major maintenance of the planes. He did not intend to do it here in Canada. Now, where will that maintenance be done? If he owns about 80% of Aeroman, in El Salvador, we are practically certain that our jobs will be lost and go to El Salvador. These are Quebeckers and Canadians who will be losing their jobs. Why? For the simple reason that our government doesn't want to enforce a law that it is relatively simple to enforce. The act is clear and plain: Air Canada must have its maintenance centres in Canada. However, Air Canada. But Air Canada no longer has maintenance centres in Canada. The proof is that the Canada Industrial Relations Board has said that the company had no connection with Aveos, which explains that Air Canada is allowing the transition that will be happening in the near future. We are therefore asking the government to intervene.

[The Chair, Conservative, Merv Tweed]

Merci, Monsieur St-Jean.

I will advise the committee that the letter we spoke of this morning has been sent to everyone's mailbox. I asked that they print it in both English and French and distribute it before the end of the meeting today.

[Gerry Byrne, Liberal, Humber—St. Barbe—Baie Verte, NL]

Mr. Chair, that was sent, I understand.

[The Chair, Conservative, Merv Tweed]

It just came from the clerk's office.

[Gerry Byrne, Liberal, Humber—St. Barbe—Baie Verte, NL]

Could we get printed copies before our witnesses depart the room?

[The Chair, Conservative, Merv Tweed]

That's what I just said, yes.

We'll go to Mr. Bevington.

[Dennis Bevington, NDP, Western Arctic, NT]

Thanks, Mr. Chair.

I want to thank the witnesses for coming here today and for really clarifying a lot of the testimony we heard previously from Air Canada. I think it's incumbent upon this committee to make sure that the testimony we're dealing with is accurate and that they answer the questions, but in a fashion that gives us information that's of value to us. Certainly a key part of that testimony was from Madam Gravitis-Beck. It was with regard to the shareholders' responsibility for the sale of the overhaul centres.

Have these centres been sold? Are they in some kind of lease arrangement? Can you give me some details on that as well?

[Jean Poirier]

Could I first talk to you a bit about Ms. Gravitis-Beck, to give you part of the context?

Ms. Gravitis-Beck, who is a senior official at the Department of Transport, is supposed to tell the truth to the government and to know more than we do. We are often called "wrench monkeys". She is the one who is supposed to know the law. In 2006, the structure of Air Canada changed. Air Canada Technical Services, ACTS, was now part of ACE Aviation.

I would like to know why Ms. Gravitis-Beck said in her 2010 testimony that the following companies, Air Canada Ground Handling Services, Air Canada Technical Services, which is now Aveos, and Air Canada Cargo, came under the government's jurisdiction. When she came here to testify, she told the government that the Official Languages Act was a direct obligation, that maintaining the overhaul centres was not under the government's responsibility, and so the government did not have to get involved. I would like to know why Ms. Gravitis-Beck changed her tune in 2010. What she said in 2006 reflected what was said by Janet Smith in 1988. At that point, everything meshed.

In 2010, it was all sold, and the CIRB made a decision. For information, those people then said that the CIRB was not the appropriate authority to consider the Air Canada Act. So they agreed to split certification, without regard for the act.

Does that answer your question about Ms. Gravitis-Beck a little, Mr. Bevington?

[Dennis Bevington, NDP, Western Arctic, NT]

It certainly suggests to me that we need to bring these people back in front of this committee. We have some conflicting testimony here. I've very glad you've laid it out in the fashion you have so that we can see quite clearly what's going on here. There are justifications being given for actions that are inconsistent with previous statements that were made and certainly with the testimony given at the beginning, when the act was created.

You have another one here from Ms. Sénécal, Air Canada's legal advisor, who at our meeting stated that Air Canada did not need employees at its overhaul centres to comply with the act. In other words, she said that as long as we have an empty building, we have an overhaul centre. Clearly, that was not what was intended by the legislation in the beginning. The fact that perhaps there's some kind of lease arrangement or some kind of holding of ownership of centres that are actually being used by others is not enough to satisfy what was the original spirit of the act.

Are you following me?

[Jean Poirier]

What we're saying isn't based on hearsay, it's based on the legislation. That is also the case for our study. Fred Lazar and Arthur Donner, two well-known economists who I hope are going to testify today, clearly said that they only way to sell the overhaul centres or have employees from other companies working there would be to bring an action against the government or tell it to amend the act.

I wonder whether Air Canada has brought an action to allow it to circumvent the act. Otherwise, is the government going to ask Air Canada to comply with the act, or it will bring an action against the company? That is what the experts have said. I will give you the two experts' names again: Professor Fred Lazar, a well-known and respected York University economist, and Arthur Donner, also an economist. They testified in 1988 and explained these facts very clearly.

[Dennis Bevington, NDP, Western Arctic, NT]

I'll give the rest of my time to Mr. Maloway.

[Jim Maloway, NDP, Elmwood—Transcona, MB]

Thank you.

I see several misrepresentations in the December 14 committee meeting, particularly with regard to what can be done by Aeroman in San Salvador.

I have a 65-page memorandum by J.P. Morgan from February 2007 in which they laid out the business case for enticing private sector investors. Of course they didn't talk about the Air Canada Act; it was simply a business case for attracting investors. They indicated that El Salvador was a place where they'd want to be doing maintenance. I believe the cost per hour is $90 in Canada and it's only $40 in El Salvador.

They talk about the increase in the bays. Page 8 of that confidential memorandum of February 2007 talked about a substantial expansion of the Aeroman's subsidiary in San Salvador from four bays to sixteen. Could you tell me at this point how many bays they have?

[Serge Gélinas]

I think that Aeroman in El Salvador now has six hangars for airplane maintenance. Given the size of the land it owns, the company could have 16 hangars. If that were the case, it would amply cover all the maintenance done in Canada for Air Canada and other potential customers.

[The Chair, Conservative, Merv Tweed]

Thank you.

I have to go to Mr. Jean.

[Brian Jean, Conservative, Fort McMurray—Athabasca, AB]

Thank you for coming today. I appreciate your lowering your voice. It's difficult with everything going on.

First of all, I am a Conservative. I've never heard conservative so much by a union in my life, so I appreciate your coming here and blowing the trumpet. I'm proud to be from Fort McMurray, the city in Canada with the most union members per capita. I was in a union at one time myself. I want you to know that I understand that.

I'm curious about who you're representing. You're here for the International Association of Machinists and Aerospace Workers, Local lodge 1751. So you're here for the local lodge, is that correct?

[Jean Poirier]

I could say yes, not because you now have before you the national district vice-president who represents all Air Canada employees throughout Canada. The local lodge and the national level are represented.

[Brian Jean, Conservative, Fort McMurray—Athabasca, AB]

So that's my question.

Do you have something to add, Mr. Gélinas?

[Serge Gélinas]

I just want to tell you who we represent. If I'm mistaken, tell me.

There was a meeting where we explained to our district members the political efforts that are underway. Everyone from everywhere in Canada had a meeting. There was the district and the Canadian Grand Lodge. They support us, politically, in our efforts to save tens of thousands of jobs.