Cavalluzzo LLP Secures Major Win for Employees of the Bankrupt Aveos Company

The End of a Long Saga

News/
4 February 2021
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On February 3, 2021, the Federal Court issued a decision that puts an end to a long and unfortunate saga. In 2012, a large aircraft maintenance company operating in Quebec known as Aveos Fleet Maintenance, shut its doors and sought consumer protection. In 2013, it commenced bankruptcy proceedings. As a result of this unfortunate turn of events, many thousands of employees lost their jobs. Worse, for many of these employees, Aveos had failed to pay them unpaid wages, vacation pay, termination, and severance pay, all minimum amounts the applicable statute (the Canada Labour Code) required they be provided.

Many of the affected employees were members of the International Association of Machinists & Aerospace Worker’s Union, a long-standing client Cavalluzzo LLP has been proud to represent for many decades.

The Aveos saga eventually led to an investigation by Labour Canada and a series of proceedings resulting in a $2.7 million set of payment orders against eight former Directors of Aveos, orders that were confirmed by an arbitrator. Those Directors sought judicial review of the arbitrator’s decision confirming the payment orders.

Cavalluzzo LLP was retained by three of the ex-Aveos employees to fight the judicial review. Together with other counsel, they converted the judicial review into a form of class proceeding so that every ex-employee could be effectively represented. After several years of extensive litigation, the ex-directors and employees, through counsel, signed a settlement agreement.

In her decision, the Associate Chief Justice of the Federal Court fully approves the settlement entered into, noting that, assuming a reasonably high take-up rate, ex-employees should see at or near 100% compensation.

Litigation like this is extraordinarily complex, as it engages the interaction of multiple federal and provincial statutes and does so through a complex vehicle, the class action. Cavalluzzo LLP is proud of its achievement in this complex matter and salutes the unionized employees who waited patiently for justice to be served.

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