Trudeau says government will not intervene in Air Canada dispute with pilots

By David Ljunggren

OTTAWA (Reuters) -The Canadian government will not intervene to end a dispute between Air Canada and its pilots and intends instead to pressure both sides to avert a strike, Prime Minister Justin Trudeau said on Friday.

A stoppage could start as soon as Sept. 18. Air Canada and its low-cost subsidiary Air Canada Rouge together operate nearly 670 flights per day, and a shutdown could affect 110,000 passengers daily as well as freight carriage.

Airline and business groups want the Liberal government to force the two sides into binding arbitration before a strike starts, an idea that Trudeau dismissed.

"I'm not going to put my thumb on the scale on either side. It is up to Air Canada and the pilots' union to do the work to figure out how to make sure that they are not hurting millions of Canadians," he told reporters in Quebec.

"Every time there's a strike, people say 'Oh, you'll get the government to come in and fix it' - we're not going to do that. We believe in collective bargaining, and we're going to keep pushing people to do it."

Labour Minister Steven MacKinnon met both the company and the union on Thursday. Both sides are still far apart on the question of wages.

MacKinnon has broad powers to tackle disputes and last month intervened within 24 hours to end a stoppage at the country's two largest railway companies, Canadian Pacific Kansas City and Canadian National Railway.

Air Canada says this set a precedent. But while Ottawa has intervened several times in labor disputes over the last few decades, it has only done so after stoppages have begun, not before.

"We are not going to interfere, we are not going to take action before it really becomes very clear that there is no goodwill at the negotiating table," said Trudeau.

The Business Council of Canada, the Canadian Chamber of Commerce, and the U.S. Chamber of Commerce issued a joint statement on Friday calling on Ottawa to intervene to prevent a strike before it began.

(Reporting by David Ljunggren, editing by Deepa Babington)