The International Association of Machinists and Aerospace Workers Local 140, a day after rejecting a tentative agreement it forged in early June with Air Canada, is dangling an assurance of industrial peace when Vancouver hosts the 2010 Winter Olympic Games and the Paralympics.

The mechanics and technical personnel, fearing losing their work to El Salvador, want an assurance of job protection and better pay in exchange for a promise of no industrial action when Canada hosts the winter games next year.

IAMWA Local 140 president Chuck Atkinson hinted to Globe and Mail, “It might be a black eye for Canada is there were a strike during the Olympics or if Air Canada went into bankruptcy protection before then.”

A ratified labor agreement is one of the keys Air Canada need to secure $600 million in emergency financing and to avoid a second bankruptcy proceeding.

However, all hope is not yet lost for Canada’s largest air carrier, which is also a major sponsor of the Vancouver games since the IAMAW expressed willingness to sit down this week with Air Canada representatives and mediator and former Ontario judge James Farley.

If Farley manages to convince the IAMAW Local 714 and Air Canada to come up with an amended collective agreement, another round of ratification would take place. In the last ratification, 50.3 percent of machinist and other technical employees belonging to the local rejected the labor deal, while clerical and finance workers overwhelmingly approved the agreement.

Air Canada has a sister company in El Salvador, where IAMAW member suspect the bulk of their work will be moved. The air carrier declined to comment on the threat of an Olympic strike.

Air Canada is the official airline of the 2010 athletic event. To drum up support for the Paralympics, the air carrier promised in March to donate $1 for every online booking made from March 16 to 22. It is part of the airline’s $750,000 pledge to the Canadian Paralympic Committee, which is spread over seven years.

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