Fair Agreements for Canadian Pilots

Transat Pilots 2025 Contract Gains

With the latest Air Transat pilot agreement now finalized, one might be asking how Air Transat/ALPA was able to achieve these gains in light of decades of financial struggle. In the context of negotiation, the question should be rephrased to “Why” were the pilots able to secure so many gains?
The answer is that paying up was cheaper than the alternatives, given Transat’s position in the North American pilot labour market.

Avoiding a crippling peak season strike

• The tentative deal was reached hours before a strike deadline that would have hit at the start of the peak winter holiday period, when Transat makes a disproportionate share of its annual revenue. 
• A multi day December–January shutdown would have meant lost revenue, cash refunds, rebooking costs, regulatory penalties and brand damage that could easily rival or exceed the incremental annual cost of the new pay scales.

Pilots are moving toward airlines that offer better conditions
Pilot retention was a major factor that drove Air Transat’s management decision to agree to a more expensive labour contract. The real competitive pressure comes from the fact that pilots now have better options. They are increasingly willing to move to airlines that offer compensation and working conditions that match the responsibility of the job and the value they bring to the operation.
The modern labour dynamic isn’t about a lack of pilots; it’s about a lack of pilots willing to stay when compensation lags behind the market. For many Air Transat pilots, moving to another carrier carried the promise of:

• Higher pay over both the short and long term
• Better long term career progression
• A stable fleet and route structure

When a competitor offers a materially better package, pilots don’t wait—they leave.

Air Transat’s decade-old contract made it vulnerable
Air Transat pilots had been working under outdated conditions for years. Their compensation had fallen behind both Canadian and U.S. norms. That gap made it easy for pilots to justify moving to a carrier with more modern pay scales and protections.
The new contract was a long-needed correction. If Air Transat hadn't responded appropriately, it risked becoming the lowest paying major airline in the country, which is arguably the fastest way to lose pilots.

• Both ALPA and media coverage emphasized that the previous pilot contract was “outdated” and lagged Canadian and North American industry standards, which created a wide, well documented gap the company couldn’t credibly deny. 
• Once Transat itself publicly framed its proposal as a significant increase over five years “to catch up” on compensation, it implicitly acknowledged a structural underpayment problem that had to be fixed to retain pilots. 

Losing pilots is more expensive than paying them
This is true for all Canadian carriers. Losing pilots can disrupt entire route structures.

• Training replacements takes months
• Seasonal peaks require full staffing even if this means carrying staff in the shoulder seasons
• Operational reliability collapses with even modest attrition
• Brand reputation, once lost due to an unreliable schedule takes years to recover

The financial and reputational damage from losing pilots far exceeds the cost of wage increases.
Protecting recovery: Transat just returned to profitability in 2025 with record adjusted EBITDA after years of heavy losses and pandemic debt; executives now have something to protect and cannot afford prolonged operational chaos. A high profile labour conflict right as investors and lenders are reassessing Transat’s viability would have undercut management’s story that the 2022–2026 plan is working and that the balance sheet is on a repair trajectory. 

Industry pattern and benchmarking pressure
The ALPA narrative that the deal is “consistent with collective agreements other ALPA represented pilot groups are signing” matters: once larger Canadian carriers and ULCCs have set new bands, Transat faces a de facto market rate. 
Refusing to move toward that pattern would risk Transat becoming the “training airline” that pilots leave as soon as they can, undermining reliability and feeding a negative reputation loop with crews and passengers alike.

Pricing flexibility with pass through potential
Leisure demand to the Caribbean and Mexico remains “sturdy,” and Transat is heavily concentrated on those routes, giving it the ability to push modest fare increases and ancillaries to offset part of the higher wage bill. 
With a 5 year runway to 2030, executives can smooth the cost ramp in their yield management and network planning rather than absorbing it all at once, making the optics manageable with lenders and analysts.

Strategic need for labour peace through 2030
The contract runs to April 2030, locking in labour peace with the pilot group for five years and taking the threat of another near term strike off the table. That stability is valuable collateral when negotiating refinancing of government loans and other debt, because lenders care as much about industrial relations risk as they do about income statement snapshots. 

Power balance: credible strike threat and public optics
ALPA demonstrated high unity (roughly 90–91% approval vote) and was ready to walk just before peak season, giving its strike threat unusual credibility. 
From a reputational standpoint, a carrier stranding families at Christmas over a contract widely described as “catch up” on pilot pay is politically and commercially toxic, especially so for Air Transat after taxpayers helped keep them alive during the pandemic; executives had strong incentive to avoid that narrative.

Taken together, Air Transat executives concluded that:

1. The near term financial and reputational hit of a strike was worse than the long term cost of higher wages
2. Competitive pilot market realities meant they would pay these rates eventually anyway, and
3. They could partially neutralize the cost through productivity, pricing and a stronger balance sheet story to lenders and investors. 

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