Air Canada lays off roughly 1,700 employees, reduces flight capacity

Air Canada is cutting approximately 1,700 jobs while scaling down flights for the first quarter of 2021.

The announcement was made on Wednesday morning with the airline saying its “adjusting its network under its COVID-19 Mitigation and Recovery Plan.”

Part of the pandemic mitigation plan includes reducing first-quarter system capacity by 25% along with the near-1,700 “workforce reduction.”

Air Canada says it’s working with its union on mitigation programs.

“Since the implementation by the Federal and Provincial Governments of these increased travel restrictions and other measures, in addition to the existing quarantine requirements, we have seen an immediate impact to our close-in bookings and have made the difficult but necessary decision to further adjust our schedule and rationalize our transborder, Caribbean, and domestic routes to better reflect expected demand and to reduce cash burn,” says Lucie Guillemette, Executive Vice President and Chief Commercial Officer at Air Canada.

“We regret the impact these difficult decisions will have on our employees who have worked very hard during the pandemic looking after our customers, as well as on the affected communities.”

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Guillemette says while the news is not what the airline hoped for, Air Canada is “encouraged” that Health Canada has approved two COVID-19 vaccines and that the federal government expects “the vast majority of eligible Canadians to be vaccinated by September.”

The CCO of Air Canada says the airline “looks forward” to seeing the business start to return to normal and hopes to bring back some of the more than 20,000 employees that have been laid off or furloughed since the onset of the pandemic in the future.

With the newly announced reduction, capacity in the first quarter of 2021 will be “about 20 percent” of what Air Canada operated in the first quarter of 2019, says the statement.

The company will continue to evaluate and adjust its route network as required in response to the ever-evolving trajectory of the pandemic, government-imposed restrictions, and quarantines.

Affected customers on all routes will be contacted by Air Canada and offered options, including refunds for eligible customers and alternative routings, where available.

Last week, WestJet trimmed capacity within its network by 30% and laid off 1,000 employees.