09/30/2011 02:50 EDT | Updated 11/30/2011 05:12 EST

Air Canada flight attendants begin voting on collective agreement

MONTREAL - Air Canada's flight attendants began voting Friday on a collective agreement reached last week, just ahead of a strike deadline.

The airline's 6,800 flight attendants started 10 days of voting, with the fate of the deal being announced Oct. 9.

It's the second tentative agreement reached this year between the country's largest airline and the Canadian Union of Public Employees.

In August, the flight attendants rejected the first deal with 87.8 per cent of the votes opposed — setting the stage for another round of negotiations.

An agreement was hammered out Sept. 20 with the help of federal mediators and under the threat of federal back-to-work legislation.

Neither union leaders nor the Montreal-based carrier (TSX:AC.B) would comment on whether they believed the agreement will be approved this time.

Union president Jeff Taylor has said he believed the negotiations delivered 80 per cent of what the membership was seeking.

Air Canada CEO Calin Rovinescu has acknowledged that flight attendants and customer service agents who approved a deal after a three-day strike in June achieved improvements they were seeking.

He said the airline still has more work to do on the cost-cutting front and make the best of what it achieved during negotiations.

"If we don't have the full cost targets that we had then, we'll have alternative strategies to get there. But I'm satisfied and pleased that we got through this last phase," he said in an interview last week.

In addition to work rule changes, reports suggest flight attendants won wage increases of nine per cent over four years. New hires will also be subject to a hybrid pension plan of defined benefits and defined contributions.

A federal arbitrator sided with the union representing customer service workers in approving the hybrid system instead of a switch to a pure defined contribution pension plan as proposed by the airline.

Fred Vettese, chief actuary of human resources consultants Morneau Shepell, said Air Canada's new hybrid plan will be hard to communicate to members and more costly and complicated to administer.

"A slimmed down DB plan for Air Canada’s flight attendants will cost about the same to administer as the full-scale DB plan that current Air Canada employees enjoy," he wrote in Benefits Canada.

"The cost of administering a two-tier plan is nearly twice as much as administering only a stand alone DB or DC plan."

If the flight attendants endorse the new labour agreement, Air Canada's next task will be to hammer out deals with its mechanics, pilots and dispatchers. The last two groups both rejected earlier tentative agreements.