Air Canada 2008 Annual Report Download - page 15

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2008 Management’s Discussion and Analysis
15
In 2005, Air Canada introduced incentive programs and a profit sharing plan in order to engage employees in their
valuable role to ensure Air Canada’s success. The “Sharing Our Success” plan emphasizes the relationship between
performance and personal rewards by providing employees with financial rewards on a monthly basis when
operational performance levels are achieved. The plans also permit employees to share in the fiscal year-end pre-tax
profits when corporate, financial and operational performance levels are achieved. In each case, employees receive
the greater of the amounts payable under the “Sharing Our Success” plan and the annual profit sharing plan. In 2008,
a total of $33 million was paid in advance under the “Sharing Our Success” plan.
Air Canada is one of the few remaining North American carriers with defined benefit pension plans. Air Canada
provides defined retirement benefits for all unionized and most management employees. In 2008, Air Canada
made cash contributions of $456 million under these plans, of which $189 million represented past service costs in
accordance with Air Canada’s agreement with the Office of the Superintendent of Financial Institutions (“OSFI”).
Refer to section 9.6 of this MD&A for additional information on Air Canada’s pension funding obligations.
As part of Air Canada’s ongoing objective to improve overall employee relations throughout the organization, in
2007, it completed a two-day training program for substantially all management employees, including executive and
senior management. Called “Relationship Matters”, this program focused on skills training around the principles of
leadership, effective communication and taking ownership and accountability for one’s own area of responsibility.
This program was provided to its frontline unionized employees in lead functions starting in the first quarter of 2008.
In the latter part of 2007, Air Canada commenced a second training program that focuses on the institutional
relationships between Air Canada and its unions. Called “Labour Relationships Matter”, this program provides
participants with knowledge, skills and tools to build and maintain authentic and constructive relationships with
union representatives and unionized employees in accordance with Air Canada’s labour relations philosophy.
Substantially all executive, senior management and frontline managers have completed this training program.
In 2008, Air Canada also commenced an intensive course on all aspects of customer services. Called “Customer
Service Managers Foundation”, this program provides managers with the skills to coach and support employees to
provide consistent exceptional customer service. It involves classroom time as well as job shadowing across the
organization to help share tips and best practices.