Air Canada to fire 20,000 employees

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Prime Minister Justin Trudeau says he plans to keep working with airlines hard hit by the COVID-19 pandemic but wouldn’t address whether a bailout of the beleaguered industry is on the table.

His comments came one day after Canada’s largest airline revealed it was preparing to slash its workforce by at least half.

“We’re going to continue to work with sectors and industries to try and support them as they get through this pandemic,” Trudeau said, referencing the federal government’s offer this week of bridge financing for large employers to keep workers on the payroll. 

“It is not a bailout, it is a loan that is going to help [businesses]…but we are still working with companies to see who is taking that up and how the format of it will be worked out.”

Travel restrictions put in place to limit the spread of COVID-19 across Canada — and the world —  have paved the way for a bleak summer for the country’s tourism and travel industry.

In a memo sent to staff Friday, Air Canada said it expects to lay off “approximately 50 to 60 per cent” of the company’s 38,000 employees in an effort to rebuild after the crisis. 

“COVID-19 has forced us to reduce our schedule by 95 per cent and, based on every indicator we have, our normal traffic levels will not be returning anytime soon,” the company wrote in a statement. “Our current workforce supports an operation transporting 51 million customers a year with 1,500 flights a day and 258 aircraft. With current realities, this is simply not sustainable going forward.”

The news follows the company’s efforts last month to rehire thousands of employees it had previously laid off because of the pandemic, after Ottawa confirmed the airline would qualify for the federal government’s wage subsidy program.

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