Air Canada looking to outsource HR

California-based outsourcer hopes to ink seven-year deal with struggling airline

Air Canada has taken the first step in outsourcing its human resource function.

The Montreal-based airline has signed a non-binding letter of intent with Exult Inc., a business process outsourcing firm based in Irvine, Calif., that will see Exult provide integrated HR processing services for Air Canada.

“Air Canada selected Exult after an extended, highly competitive evaluation,” Exult said in a statement. “Contract negotiations are underway and expected to conclude shortly.”

Exult said it anticipates to ink a seven-year deal with Air Canada by the end of 2004, and will use its shared client service centres — including one in Toronto — to service the airline’s 30,000 employees.

“This decision aligns with Air Canada’s objectives to both reduce costs and to utilize proven technology to e-enable our workforce,” said Sue Welscheid, vice-president, people, for Air Canada. “Exult provides us with a technological infrastructure that will vastly improve the deliver of HR services to our employees by giving them access to a range of self-service HR tools.”

The move to outsource could result in the transfer of salaried finance, accounting and other administrative positions out of the airline, according to a Canadian Press report. But it’s not clear how many positions would be transferred, or if any positions would be eliminated entirely, should the contract negotiations end in an agreement.

Air Canada sought bankruptcy protection in April 2003, and is working on a new business plan that would see it emerge as a smaller airline with fewer employees and aircraft.

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