Photo: Tyler Anderson/National Post

Air Canada will create a Western Canadian Centre of Excellence for aircraft maintenance.

OTTAWA — Air Canada will create a Western Canada Centre of Excellence for aircraft maintenance in exchange for Manitoba not taking legal action against the airline for failing to meet obligations under the Air Canada Public Participation Act.

In a release issued by Air Canada late Monday, CEO Calin Rovinescu said 150 jobs will be created in Winnipeg in 2017, with the possibility of further growth.

“This agreement should further develop and diversify Manitoba’s aviation expertise and help create quality jobs in a highly competitive and dynamic industry,” he said in the release.

Premier Greg Selinger said this is a “positive, constructive agreement” that will bring high-paying jobs very quickly.

“Manitoba can compete with anyone in aerospace,” the premier told the Free Press. “We believe this a very positive step.”

He said he feels the 150 jobs can be doubled relatively quickly.

Manitoba was an intervener in a Quebec lawsuit against Air Canada filed in 2012 after the company Air Canada used to conduct heavy aircraft maintenance in Winnipeg, Montreal and Mississauga, Ont., went bankrupt.

The Air Canada Public Participation Act, passed in 1988 when Air Canada was privatized, specifies the airline must keep maintenance jobs in Winnipeg, Montreal and Mississauga.

But in 2012, when Aveos Fleet Performance went bankrupt, those jobs went out of the country. About 400 people were thrown out of work in Winnipeg, another 1,800 in Quebec and about 200 in Ontario. Quebec sued the airline for violating the act and won the case, and the decision was upheld on appeal.

Late last year, Air Canada filed a motion to appeal to the Supreme Court of Canada. However, in February, the Quebec government secured a 20-year contract for maintenance work on Air Canada’s new Quebec-made Bombardier C-Series jets the airline intends to buy. As well, a centre of excellence for the revision of the C-series planes will be created in Quebec.

In exchange, the government of Quebec agreed to drop its lawsuit.

After the Quebec deal was announced, Federal Transport Minister Marc Garneau indicated he intends to change the act to make it clear what is required of the airline. The confusion in the lawsuit stemmed from whether the act referred to heavy maintenance, the kind of work that sees an airplane taken out of service for overhauling engines or other systems, or line maintenance, which mostly happens while an airplane is parked at the gate between flights. The provinces argued the former, the airline argued the latter was sufficient.

Former Aveos workers in Manitoba were livid about the Quebec deal, saying the federal government was going to change the law to no longer require jobs in Manitoba just because Quebec and Air Canada had come to an agreement. It brought back memories of the CF-18 debacle of the 1980s, when Quebec-based Canadair won the contract to build CF-18s despite a technically superior, lower-cost bid from Winnipeg’s Bristol Aerospace.

However, after about a month of negotiations, Manitoba has secured an agreement, as well.

Air Canada will use three of its long-standing suppliers: Hope Aero Propeller & Components Inc., which specializes in propellers, wheels, brakes and batteries; Airbase Services Inc., which specializes in interior equipment maintenance; and Cargojet Airways Ltd., which is a cargo transportation company that specializes in the moving of pharmaceuticals, dangerous goods and human remains for burial.

Air Canada intends to lease one of its two Winnipeg hangars to Cargojet so the airline can establish “maintenance activities.”

Currently, only Cargojet has a presence in Manitoba.

At least one former Aveos worker is not pleased. Mike Maskell, who took an early retirement when he was laid off four years ago, said this agreement “is not even close to good enough.”

“At first blush, it seems wonderful,” he said. “But it’s really a small spit in the ocean.”

Maskell noted there were more than 700 people employed by Aveos at one point, and the centre of excellence doesn’t sound to him like it will create similar jobs. He said there would often be seven aircraft in the two Air Canada hangars at the Winnipeg airport undergoing major overhauls at the same time.

Although the governments of Quebec and Manitoba are in the process of withdrawing their legal action against Air Canada, the former employees are not. The Quebec Federation of Labour last week filed papers asking a court for an injunction against the airline to force it to live up to its requirements under the act.

Garneau has not said specifically how he intends to amend the act.

In a release Monday night, the Winnipeg Airports Authority said it was happy to be joining with the province, Yes! Winnipeg and industry in backing the centre of excellence to be based on the Richardson International Airport campus.

“Working as part of a broad community team interested in creating jobs and placing Winnipeg’s aerospace support sector on a positive trajectory is both exciting and rewarding,” said Barry Rempel, president and CEO of the Winnipeg Airports Authority. “I view this as just the start as these new partners work with us to generate future development opportunities to boost our region’s economy by breathing new life into our existing aviation employment assets on the west side of the airport campus.”
posted originally in: Winnipeg Free Press, March 14, 2016