(Reuters) — The union representing 3,000 Air Canada pilots says it has failed to reach a contract agreement with the country's largest airline after 10 days of mediated talks, leaving the dispute in the hands of a government arbitrator.
A federal arbitrator will now have less than 90 days to choose between proposals submitted by the pilots and airlines, imposing an agreement on both sides.
"To say we are disappointed would be a vast understatement," said Captain Jean-Marc Belanger, chair of the master executive council of the Air Canada Pilots Association (ACPA).
Air Canada could not be reached immediately for comment.
Ten days of talks began in the second week of May after the Canadian government appointed an arbitrator to resolve the drawn-out contract dispute.
Canada's biggest airline and the ACPA have been in sporadic talks for more than a year. The pilots have worked without a contract since March 13, 2011.
Money-losing Air Canada wants to launch a separate discount airline that it says is crucial to its efforts to become profitable. Unions oppose the plan, fearing that it puts their benefits and job security at risk.
Air Canada was able to avoid major strikes by its pilots and machinists earlier this year after the government passed a law that prevented the two unions from striking and Air Canada from locking union members out. The legislation sent the contract disputes to binding arbitration.
Despite the legislation, Air Canada's operations have been hurt by wildcat strikes involving members of both unions over the past two months. While short-lived, the strikes caused a string of flight cancellations across the country.
Both unions have challenged the law as unconstitutional.
A federal arbitrator imposed a labour contract on Air Canada's flight attendants in November. The attendants had voted down the month before.
The Canadian Union of Public Employees (CUPE), which represents the airline's 6,800 flight attendants, said the ruling was disappointing.
The deal included the same hybrid defined-benefit and defined-contribution pension plan that another arbitrator had selected for the airline's check-in and call-center staff.