Air Canada Layoffs: What Employees Need to Know About Severance Pay and Their Rights (2025 Update)

After Weeks of Speculation, Air Canada Confirms Major Layoffs

On October 24, 2025, Air Canada announced it is eliminating approximately 400 management positions across Canada following an internal review of its operations. As reported by the Toronto Star, the airline described the move as a “difficult decision” to streamline operations after a turbulent year marked by a costly nationwide flight attendant strike that disrupted operations and cost an estimated $375 million.

Samfiru Tumarkin LLP first reported that multiple Air Canada employees had reached out to the firm after being notified of job losses, before the airline official confirmation. The cuts — about 1% of the company’s workforce — affect primarily non-unionized management and administrative roles.

A Pattern of Layoffs at Air Canada

This latest announcement continues a long history of workforce reductions by Canada’s largest airline:

• 2020: Air Canada announced plans to lay off approximately 20,000 workers — over half its workforce — amid the COVID-19 pandemic (CBC News).
• 2021: The company cut 1,700 more positions as part of its pandemic recovery plan (Travel Pulse Canada).
• 2025: Air Canada suspended operations to North Bay and Bathurst as of Jan. 30, 2026 — citing “commercial viability reasons.”
• 2025: Air Canada confirmed 400 management layoffs following this year’s flight attendant strike and ongoing cost-cutting measures.

The airline industry has faced continuous turbulence, from pandemic shutdowns to labour disputes and restructuring efforts aimed at restoring profitability.

Who Is Affected by the 2025 Air Canada Layoffs

The 2025 job cuts primarily affect non-unionized management roles across multiple departments.

Unlike unionized flight attendants and mechanics — whose rights are protected by collective agreements — management employees must negotiate their severance packages individually.

That means it’s critical for affected workers to have their severance reviewed by an employment lawyer before signing anything.

What Laid-Off Air Canada Employees Should Know About Severance Pay

In an interview with The Toronto Star, employment lawyer Lior Samfiru, national co-managing partner at Samfiru Tumarkin LLP, explained that severance is not a fixed formula:

“Employees should always assume their severance package is inadequate and not sign it right away,” says Samfiru. “It’s based on your age, the length of your employment, and the type of position you held at the company.”

He added that severance should include all compensation and benefits that would have been earned during the notice period, such as bonuses, vacation pay, and pension contributions.

Severance Pay for Air Canada Employees

If you’re a non-unionized Air Canada employee, you may be entitled to up to 24 months’ pay as severance when let go.

How Severance is Calculated

Your severance package should account for:

• Age and how it afffects re-employment prospects
• Length of service
• Position and level of seniority
• Ability to find similar work in your industry or region

What a Fair Package Should Include

A proper and fair severance package must include:

• Base salary
• Bonuses and commissions
• Benefits continuation and pension contributions
• RSUs, stock options, or incentive pay
• Vacation pay and allowances

Disclaimer: The materials above are provided as general information about the rights of non-unionized employees in Canada. It is not specific to any one company and SHOULD NOT be read as suggesting any improper conduct on the part of any specific employer, or a relationship between Samfiru Tumarkin LLP and a specific employer.