Air Canada and the Canadian Union of Public Employees (CUPE), representing around 10,000 flight attendants, have reached an impasse in contract negotiations. The union rejected Air Canada's proposal for binding third-party arbitration, seeking instead a negotiated settlement. The airline had offered a total compensation increase of 38% over four years, including a 25% raise in the first year. Following the deadlock, Air Canada requested federal government intervention and declared a potential shutdown. The union issued a 72-hour strike notice on August 13, with strike action set to begin on August 16. In response, Air Canada issued a lockout notice and announced it would start gradually canceling flights from August 14 to allow an orderly suspension of operations. The airline warned that the shutdown could last until a deal is reached, affecting Canada's largest airline and potentially stranding thousands of passengers. Canadian Jobs Minister Hajdu has been closely monitoring the situation and confirmed that federal mediators will remain available to assist in reaching an agreement.