Air Canada could face 'tens of millions' in class action damages after strike chaos

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The strike that grounded Air Canada flights left hundreds of thousands of travellers stranded from Montreal to Mexico. Now, the turmoil may soon shift to the courts.

Two proposed class actions, filed in Quebec on Monday, accuse both the airline and its flight attendants’ union of failing passengers during the stoppage. The case against Air Canada alone could be worth “tens of millions” of dollars in damages, according to lawyers involved.

The walkout began on Aug. 16 after much speculation in the week prior. It was subsequently declared unlawful and then dragged on until a tentative deal was reached on Tuesday morning. For many passengers, the disruption meant cancelled holidays, missed connections, and frantic scrambles to either rearrange a planned trip or find a way home.

Passenger files against Air Canada

One lawsuit, filed by law firms LPC Avocats and Renno Vathilakis, alleges the carrier breached federal passenger protection rules by failing to rebook travellers within 48 hours. Canadian regulations require airlines to place passengers on the next available flight, even with a rival carrier.

The claimant is a Montreal student returning to veterinary school in Grenada. According to her lawyer, Joey Zukran of LPC Avocats, she received an email on Aug. 16 notifying her that her flight the following day was cancelled. Air Canada told her it would “do its best” to rebook her within three days. She ended up buying a ticket on American Airlines out of her own pocket.

“Air Canada has an obligation to get her on an Air Canada flight or a partner carrier within 48 hours,” said Zukran. “Instead, she paid out of her own pocket.”

With the airline itself reporting that 500,000 travellers were affected, the potential damages could climb into the “tens of millions,” Zukran added.

Michael Vathilakis of Renno Vathilakis said Air Canada’s handling of the crisis only compounded frustrations.

“It seemed that throughout this entire process, Air Canada was unclear — and I would even say beyond unclear: unavailable,” he said.

Air Canada did not respond to a request for comment.

Class action against the union

A second lawsuit, filed the same day by Lambert Avocats, targets the Canadian Union of Public Employees (CUPE), which represents the airline’s 10,000 flight attendants.

It alleges the union “illegally continued” its strike after the Canada Industrial Relations Board ordered staff back to work.

According to lawyer Philippe Brault of Lambert Avocats, the claim argues CUPE’s defiance prolonged the shutdown and forced passengers to absorb extra costs for hotel rooms, meals during unexpected layovers, and replacement flights.

The claimant, who had booked a family holiday in Cancún, said the trip collapsed when crews stayed off the job despite the federal order.

The union has not yet filed a formal response.

Previously, it has defended the strike as a constitutional right. On a call with members, CUPE’s president noted the strike fund stands at $125 million.

Where does this leave Air Canada?

Although a tentative agreement has now been reached, Air Canada has warned it could take up to 10 days for schedules to return to normal.

The airline has promised to refund cancelled flights and rebook passengers, but many travellers say they are still struggling to get hold of the company.

The financial toll is expected to be steep. Analysts at RBC Capital Markets estimate the strike and subsequent restart costs will wipe roughly $500 million from Air Canada’s operating profit this year, according to La Presse.

The carrier has also withdrawn its full-year earnings guidance.

Upon the news of a tentative agreement Tuesday, its shares rose.