2323 Bulletin -CAIL Payment

January 31, 2013


You are receiving this life insurance benefit as the result of the settlement of a grievance order issued in the course of the Air Canada CCAA proceedings. In that proceeding, a large number of grievances between the IAMAW and Air Canada were adjudicated in accordance with the Court ordered Grievance Claims Procedure.

In the course of the Grievance Claims Process the Arbitrator dealt with a grievance filed by the Union concerning Air Canada’s position that prior service with Canadian Airlines International Limited (CAIL) would not be recognized by Air Canada for the purpose of accessing post retirement medical and life insurance benefits. The Union’s grievance requested as a remedy the recognition of CAIL service for the purpose of accessing these post-retirement benefits.

In the CCAA proceedings all grievances were subject to compromise under the statute. What that meant was that the Union’s claims against Air Canada were recognized only in terms of any monetary value and that the Union actually received only a pro-rata fraction of the assessed monetary value of its claims, in accordance with the Plan of Arrangement.

The decision under the CCAA Grievance Claims Procedure concerning the grievance outlined above allowed the grievance “for purposes of the plan of arrangement under the CCAA” at a value “to be agreed upon between the company and the union”. Since that time the Union and Company have engaged in discussions which have led to an agreement that Air Canada would recognize CAIL service for the purpose of access to the medical benefit and that two (2) million dollars would be allocated towards the purchase of a life insurance benefit. This amount is the full amount originally set aside for this grievance by the Union, based on the initial valuation of the entire grievance, as adjusted by the CCAA compromise.

(This is the legal version of what happened for CAIL members to get the 400 dollar cheque)

Steve O’Hara,

President LL2323

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