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People look on as an Air Transat plane takes off at Montreal-Trudeau International Airport in June, 2023. The carrier said it believes an agreement with the pilots’ union is still possible.Graham Hughes/The Canadian Press

Air Transat TRZ-T says it will begin suspending flights on Monday after its pilots’ union issued a strike notice for early Wednesday morning.

The Montreal-based airline and the Air Line Pilots Association have failed to reach a new collective agreement in talks that began last winter. Both sides are in legal strike or lockout positions on Wednesday.

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The carrier on Sunday morning called the strike notice “premature.” Air Transat said it believes an agreement is possible, but it will begin suspending service on Monday with a complete shutdown by Tuesday. Airlines take this step ahead of possible work stoppages to avoid stranding passengers, crew and aircraft. However, the move risks stranding passengers already at their destinations, and comes just ahead of the busy holiday travel season.

“It is regrettable that the union has expressed such indifference toward Transat, its employees and clients by choosing the path of a strike at this time of year — a reckless decision that does not reflect the state of negotiations,” said Julie Lamontagne, Transat’s chief human resources officer, in a statement. “While our priority is now to take care of our customers, we remain committed to the process in order to conclude a negotiated agreement.”

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The union is seeking better pay and working conditions. The previous agreement was signed in 2015.

“No pilot wants to strike, but Air Transat management has left us no choice,” said Bradley Small, a union executive who represents Air Transat’s 750 pilots. “Months of unproductive bargaining ends now. If we cannot reach an agreement, management will be responsible for every cancelled flight and stranded passenger.”

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Air Line Pilots Association members (ALPA), from left, Capt. Ronan O’Donoghue, Capt. Guy Chevalier and first officer Samer El Husseini talk at the Air Transat Pilot Strike Centre in Montreal on Wednesday after a 99 per cent vote in favour of a strike mandate.Graham Hughes/The Canadian Press

Air Transat said it has offered pilots a pay raise of 59 per cent over five years, with “major” improvements to working conditions.

The pilots’ union has not provided details of its demands, but has said it wants an agreement in line with the one signed by Air Canada’s pilots last year. Air Canada’s 5,200 pilots reached a deal with raises of 42 per cent over four years.

“There is still time to avoid a strike but unless significant progress is made at the bargaining table, we will strike if that’s what it takes to achieve a modern contract,” Mr. Small said.

Founded in 1986, Air Transat employs about 5,000 people. The leisure-focused carrier sells flights and vacation packages to destinations in Europe, the Caribbean and elsewhere.

At Montreal-Trudeau International Airport, Air Transat’s main hub, the airline is scheduled to fly 12 flights on Sunday and eight on Monday to resort destinations in Europe and the Caribbean. At Toronto Pearson International Airport, Air Transat has 10 flights scheduled on Sunday and six on Monday. This does not include several routes flown with Porter Airlines, with which Air Transat has a partnership agreement. A Porter spokesman was not immediately available to comment.

Transat AT, the airline’s operating company, is struggling to turn a profit and reduce debt incurred after a taxpayer bailout in the COVID-19 pandemic. The company is also facing a battle for the control of its boardroom led by investor Pierre Karl Péladeau, chief executive officer of Quebecor Inc.

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Mr. Péladeau, whose Financière Outremont Inc. owns 9.5 per cent of Montreal-based Transat, is seeking to replace Transat chair Susan Kudzman and wants the number of company directors reduced to six from 11 after years of financial and operational underperformance.

Air Transat lost $114-million in 2024 and $25-million in 2023. It is scheduled to report 2025 financial results on Dec. 18.