Collective action by former Aveos employees | Air Canada anticipated a restructuring of Aveos, not a sudden shutdown

For approximately two years, Michael Rousseau served on the Aveos board of directors while being responsible for finance at Air Canada, the main client of the maintenance specialist. Well aware of the supplier’s setbacks in 2012, the main party swears that the airline has never seen its complete closure coming.

“The most difficult scenario that we considered at the time was an orderly restructuring that would allow Aveos to continue serving Air Canada,” he told Judge Marie-Christine Hivon of the Superior Court of Canada on Thursday. Quebec. We didn’t plan a full shutdown in one day. ”

Currently President and CEO of Air Canada, Mr. Rousseau was testifying in the trial of the class action of at least 150 million brought by former Aveos workers against the airline, whose hearings in are in their second week.

A former subsidiary of Air Canada which became an independent entity at the end of a process which ended in 2011, the maintenance and servicing company was presented by the witness as a company which was confronted with significant financial challenges, such as high debt as well as productivity issues.

Mr. Rousseau left his seat on the Aveos board of directors at the end of February 2012, less than a month before the company’s collapse and when relations were strained with it and its main client.

Could he have disclosed to his employer information deemed privileged about Aveos’ financial situation? Never, pleaded the witness in the course of his cross-examination by the prosecution.

“I could not do this directly or indirectly,” said Rousseau, in response to a question where the prosecution pointed out that he was in possession of financial information useful to Air Canada. There were exchanges between the two companies. ”

Mr. Rousseau explained that Aveos’ strategic plan after hiring President and CEO Joe Kolshak in 2011 called for the end of heavy aircraft maintenance, activities deemed unprofitable at the time, in 2013. , at the end of the contract with Air Canada. Aveos wanted to focus on servicing engines and components.

The witness testified that he did not inform Air Canada of this strategy.

Aveos generated over 90% of its revenue from the country’s largest airline. Its maintenance centers in Montreal, Winnipeg and Mississauga suddenly ceased operations in March 2012. This paved the way for legal action against Air Canada, which was accused of not respecting the law. federal.

In total, some 2,600 people, including 1,800 in Quebec, had lost their livelihood. The class action covers the period from the year of the shutdowns to 2016, when the Trudeau government agreed to change federal law.

The complainants also want to demonstrate that Air Canada deliberately caused the closure of the maintenance company by its actions.

Another version

On Wednesday, Mr. Kolshak explained that his strategy, which aimed to increase and diversify Aveos’ customer base, took a nosedive when at the end of 2011, the volume of work from Air Canada was declining. The liquidity crisis had therefore intensified.

M. Rousseau saw things differently.

“I don’t agree,” he said. We do not believe that the volume (of delayed work) was significant. For a few weeks we wanted to get a feel for the direction (of Aveos). ”

In addition, there were indeed several disputes between Aveos and its main client about billing, confirmed Mr. Rousseau. Again, his take on the situation was different from the picture painted the day before by the former Aveos executive.

In the opinion of the chief financial officer of Air Canada in 2012, the maintenance specialist’s system was “very inadequate”.

“We were very concerned with their system and we had to check every invoice to make sure everything was in order,” said the witness. I remember that they sent us an invoice which was completely unreasonable considering the work done. ”

On Wednesday, Kolshak criticized Air Canada for withholding payments due to litigation, which affected Aveos’ cash flow.

On this point, Mr. Rousseau replied that the arbitration process provided that the air carrier had to pay the first installment of 5 million of an invoice which was the subject of a dispute, which allowed Aveos to obtain money.

2016

Quebec and Ottawa had agreed to turn the page on the Aveos file. Air Canada then bought 45 C Series aircraft, which became the Airbus A220. The order was subject to 12 cancellations last year.

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