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Air Canada to immediately rehire more than 16,000 workers

Air Canada to immediately rehire more than 16,000 workers
Business
More than 16,000 workers laid off by Air Canada last week in the wake of the COVID-19 pandemic are being hired back by the airline, the Star has learned.

The official announcement is expected to come Wednesday after discussions between federal officials, the airline and its unions about whether the company would be eligible for the 75 per cent wage subsidy announced as part of the government’s COVID-19 aid package.

The Canada Emergency Wage Subsidy (CEWS), announced April 1, is directed at companies who have seen their revenues drop by at least 30 per cent because of the pandemic.

According to a draft copy of an Air Canada press release the airline meets that qualification. Air Canada didn’t immediately respond to a request for comment. A source familiar with Air Canada’s decision confirmed the contents of the release.

The rehiring would be retroactive to March 15 and run at least until the end of the CEWS program on June 6, the release quoted Air Canada CEO Calin Rovanescu as saying.

“The Canada Emergency Wage Subsidy is an extremely important program to help employees and employers during this time of crisis, and as one of Canada’s largest employers most affected by COVID-19, we want to acknowledge the leadership of the Government of Canada in introducing it,” Rovinescu said in the release. Rovinescu and Air Canada’s chief financial officer, Michael Rousseau, are also giving up 100 per cent of their salaries, the press release said.

“We are trying to keep as many of our employees as possible during the crisis and this measure will certainly help. Depending on wage levels, many furloughed employees will get a somewhat higher amount under CEWS than they would otherwise receive from Employment Insurance payments, plus they will maintain their health insurance and other benefit,” Rovinescu said in the release.

Ottawa is now willing to cover the majority of wages for businesses that lost 15 per cent of their revenue in March, instead of the steeper 30 per cent the government had proposed earlier.

But businesses still need to demonstrate the larger 30 per cent drop in revenue to get the subsidy in April and May, compared with the same months one year earlier, the draft bill says.

The draft also includes new flexibility by allowing certain businesses to use January and February as the reference point for their falling revenue.
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