Open letter to the Federal Revenue Minister

[sunshinee]

TFWPILOT,

Thank you for making things clearer, can't wait to be in Europe again this summer.

[timel]

TFWPILOT,

Thank you for making things clearer, can't wait to be in Europe again this summer.

For the second and last time?

[sunshinee]

Timel

For the 6th time and hope for a few more.

S

[timel]

Timel

For the 6th time and hope for a few more.

S

You have a Canadian license and EASA?
On Canadian A/C or European?(or both?)

[sunshinee]

If you really are following this bla bla, then you should already know we operate on a wet lease.

[timel]

If you really are following this bla bla, then you should already know we operate on a wet lease.

Yes and I also know Europeans are putting an end to it for pilots who fly in Europe with a Canadian license.

[Gilles Hudicourt]

TFWPILOT, thanks for writing, and more so, thanks for having the guts to write. Most don't. Most don't even understand what the problem is. You won't hear it from Sunwing.
I'm glad you enjoy flying here in Canada. I'll gladly take up that offer of a beer in Europe, I am an Airbus 330 captain in my real life and spend a lot of my summers on layovers in Europe, including the UK, Belgium, the Netherlands and Germany, and I heard we may go to the Czech Republic this summer.

To begin, I am not at all xenophobic. I am originally from Haiti, where I was born, and immigrated to Canada in 1990. I don't have the background or the credentials to be xenophobic I'm afraid, at least not from a Canadian point of view......

It may be you who is not aware of many things. I have been on this file for over two years now and know it very well, very very well.

I know that your airline (I'm assuming from your email that you are Thomson) has a reciprocal agreement with Sunwing and that you guys think you are coming under some form of legitimate and fair reciprocal agreement. A few months ago I even wrote to BALPA to explain what the reality was.

Reciprocal means that two airlines exchange pilots. It has to be balanced, fair, equal. If it had been, I would not have been leading this fight and we would not be having this conversation. I think that fair and balanced reciprocal agreements are good, benificial to both groups that participate and should be promoted. But what Sunwing calls consentual sex, is actually more along the lines of rape.

Last summer, Sunwing sent two aircraft on Wet-Lease to Thomson and two aircraft on wet-lease to Travel Service, for a total of 4 aircraft. That represents about 60 pilots.

In "reciprocity", this winter, Sunwing wet-leased 5 aircraft from Travel Service and imported an additional 120 TFW from Thomson, TUIfly, Jetairfly and Akrkefly. The 200 pilots Timel quoted is correct because it includes the Czech pilots who are flying the 5 wet-leased aircraft. Maybe 190 pilots is closer to the truth.

So its not equal. Last summer, 60 Sunwing pilots went to Europe and about 190 European pilots came to Canada to fly for Sunwing. And it's been that way since the year after TUI purchased 49% of Sunwing. One winter two or three years ago, there were more Foreign pilots flying for Sunwing than Canadians.

Of course, if you look at it strictly from a Thomson point of view, it may seem fair that an equal number of Thomson pilots come to Canada as Sunwing pilots fly for Thomson in the summer, but I cannot look at it in a bubble like you do. Because we also receive foreign pilots from JetAirfly, Arkefly, TUIfly, in addition to the Czech Travel Service pilots, who also come to Canada in greater numbers than they take Canadians in the summer.

Another matter you must understand is the exchange itself, which in addition to not being equal in numbers, is not equal in the type of goods exchanged either. EASA does not allow non EASA licensed pilots to fly EASA registered aircraft. Our Canadian licensed pilots are not allowed to fly European registered aircraft. Which is why Sunwing does not send just pilots to Europe, but sends wet-leased aircraft. So the Sunwing pilots who come to Europe, come with their own aircraft that they fly under their own Certificate. The foreigners who come to Canada on the other hand are allowed to fly Canadian registered aircraft with a Foreign licence. This is not allowed by the Canadian Aviation Regulations. Its forbidden by CAR 705.106(1) specifically which says that to fly a Canadian airliner, one must have a licence issued under part IV of the CARs. Some people in the higher echelons of Transport Canada took it upon themselves to pretend that the Foreign Licence Validation Certificates that they issue to the TFW pilots are considered to be licences issued under Part IV, which they are not. One day someone is going to get in deep trouble for this crooked interpretation of the CARs.
No modern western country allows Foreign licensed pilots to fly commercially for local airlines. No European country does, the United States does not, Australia does not, New Zealand does not, I also know that Russia does not. In reality Canada does not either and this situation is an aberration. Many Transport Canada Inspectors agree with me by the way, but were overruled and received a gag order not to speak about the FLVCs the TFW pilots received.
The regulatory part is all explained here:

http://www.avcanada.ca/forums2/viewtopi ... =5&t=99311

BALPA has a copy.

You think that because the job is seasonal that it justifies denying the job to qualified Canadians and hiring Foreigners instead ? With Canada's climate, most flying jobs are seasonal. The float aircraft have a short summer season, as do the cropdusters, the helicopter operators, the waterbomber pilots, the forest patrol pilots. There are also a number of jobs that have their high season in the winter. If the seasonal nature of a flying job justifies hiring a foreigner instead of a Canadian, a large percentage of the commercial pilot pool in Canada would be made up of foreign pilots.

I have become pretty known after appearing on national TV, given radio interviews and being qouted in numerous newspaper articles where I denounce the Foreign pilots in Canada. Because of this, I regularly field calls and emails from Canadian pilots complaining to me that they are out of a job, are under-employed in Canada or are stuck in some expat job overseas when they would be happy flying for Sunwing in the winter. Many such pilots have over 10,000 hours, much of it left seat on transport category jet.

I had the Canadian Revenue Agency on the phone for hours. They detailed to me what TFW should be paying in Canada. They sent me all their laws and regulations that pertain to TFW and taxation in Canada. TFW all need to have a Social Insurance Number that begins with the number "9". All should have Canada Pension plan and Employment Insurance deductions taken from their pay and all should declare Canadian revenue. Those that are already taxed in a country that has a treaty with Canada (the UK does) can either apply for a waiver, or get a refund.
To just ignore all of that is just illegal. I think that what that lawyer suggested is just as valid as what the RyanAir lawyer told those self employed pilots in Europe to do, all those who are now hounded by the taxmen of several European countries including Germany and France.
The tax agreement, if it were true, would balance out if the number of pilots were equal on either side, but as discussed above, it is not.

I pay close to 50% of my salary in taxes. Even if I lived in another country and didn't spend a single dime of my net income in Canada, the government takes a lot of money from me at the source. I don't think your ski outings cost anything close to what we pay in taxes here.

Finally, it is not true that the Sunwing pilots going to Europe do a full six months whereas the European pilots come to Canada for less. I have been monitoring the arrival and departure dates for 3 years now. It is true that the Thomson pilots are those who seem to come to Canada for the shortest time, some barely 3 months, but most other foreign pilots come for much longer. I have a spreadsheet with all the data. The average is just under 6 months.

Regards,

Gilles

[Marksmandude]

Gilles,
Is it written anywhere that reciprocal agreements must be a one to one exchange? I'm don't know that's why I ask.

Thanks

[Marksmandude]

If you really are following this bla bla, then you should already know we operate on a wet lease.

Yes and I also know Europeans are putting an end to it for pilots who fly in Europe with a Canadian license.

You don't know what you're talking about. You also don't have any insight into the law changes coming down the pipe.

[Gilles Hudicourt]

TFWPILOT, one subject I forgot to mention. It has nothing to do with taxation but still important fir yiu TFW pilots to know.
Every year, Sunwing hires a number of Canadian seasonal pilots for the winter, and the about 120 TFW pilots, and then a certain number of foreign wet lease pilots, 60 last year, about 75 this winter.

All the Canadian seasonal pilots that are hired are hired as first officers, regardless of their experience or ratings.
When foreign seasonal pilots are hired, meaning you TFW pilots, a good half or more are hired as seasonal captains.

Sunwing claims, to justify this injustice, that this because they send a number of Captains to Europe and have commitment, because of reciprocity, to hire foreign captains in exchange. But this is pure Sunwing BS.

Sunwing sent 4 wet leases to Europe last summer. The 5 wet leases they imported from Czech Travel Service alone, came with more foreign captains than Sunwing sent to Europe. Just looking at wet leases, its already unbalanced. Every TFW captain who came over worsened the imbalance.

Canjet Airlines, a Canadian charter outfit recently laid off many experienced 737NG pilots, including guys who had several years in the left seat. Why would any of these guys be hired as seasonal FO when Sunwing imports TFW captains ?
Why would any ex Canjet pilot be left un-employed or seeking work in China when Sunwing imports TFWs ?

[Eric Janson]

No modern western country allows Foreign licensed pilots to fly commercially for local airlines. No European country does,

That's not correct.

I have a Licence from one country and I'm flying for an Airline based in a second country.

All without validations. This is under the EASA system.

[Gilles Hudicourt]

EASA member countries are considered one country for all that has to do with aviation. Pilots of all EASA member countries can fly the aircraft of other EASA member countries.

You are licensed in one EASA country and you are flying an aircraft of another EASA country ? Correct ?
Canada, the US, Australia, New Zealand are not members of EASA.

[photofly]

Tax. We do not pay Canadian tax. Why? The same reason the Canadians coming to Europe each year do not pay tax in Europe. The double taxation agreements between our countries means we pay tax on where we are declared permanent residents, i.e. (simplistically) where we live for more than 6 months in a tax year. If we were in Canada more than 6 months a year we would have to pay Canadian tax. We have prior approval from your authorities, negotiated through a Canadian legal firm, that instead of paying Canadian tax and then claiming it back when we leave, we just pay none in the first place. A lower burden on the admin system I'm sure you'll agree. To sum up, we continue to pay tax in Europe, your guys continue to pay tax in Canada. I would say that is fair.

I expect you understand Boeings better than you understand taxation.

The double taxation agreement means that you deduct the amount of the tax you pay in Canada on your earnings in Canada, from what you owe in your home country and so pay less in your country of domicile. It doesn't mean you don't pay any tax in Canada, nor does it mean that any tax you pay in Canada can be reclaimed from the Canadian government when you leave.

While *you* pay the same either way, it's not the same result overall. We who live in Canada require the tax you must pay on your Canadian earnings to stay in Canada and benefit the economy that enables you to earn those Canadian dollars.

Your Canadian earnings must be taxed in Canada.

[timel]

On reciprocal employment.


http://www.cic.gc.ca/english/resources/ ... /lease.asp

Approved “wet lease” arrangements between two airlines should not to be confused with “reciprocal employment” agreements. Reciprocal employment allows a foreign national to work in Canada with a work permit, but is Labour Market Impact Assessment (LMIA) exempt provided that there is evidence that a Canadian is provided a similar ‘reciprocal’ work opportunity abroad.

Overview-Reciprocal employment
Allows foreign workers to take up employment in Canada when Canadians have similar reciprocal opportunities abroad.
Entry under reciprocal provisions should result in a neutral labour market impact.
Canadians who go abroad to work under a reciprocal agreement are typically working under the employment of the foreign company. Likewise, a foreign national in the exchange to Canada under that reciprocal agreement, will be working for the Canadian company.
A crew entering Canada under R205(b) reciprocity provisions may work anywhere in Canada (whereas crew under a wet lease arrangement are restricted to international travel on the wet lease only).
Assessing Reciprocity and the LMIA Exemption
Employer should be the Canadian company.

The onus is on the applicant (and employer) to prove that reciprocity exists. Depending on the number of exchanges involved, the processing officer may need to see the reciprocity agreement.

A reciprocity agreement should be valid (i.e., signed and dated) and must clearly indicate the number of expected exchanges between the two companies per year or season.
Note: If an agreement is presented that indicates that the foreign nationals remain employees of the foreign company during their engagement in Canada then this is likely an arrangement associated with a wet lease and, as mentioned above, exchanges via wet leases cannot be included in the assessment of reciprocal employment.
It is not necessary that there be exact reciprocity, but the general order of magnitude should be reasonably similar. For example, for exchanges exceeding over 25 individuals (as a guideline), Citizenship and Immigration Canada should require a minimum proportion of 75% in terms of Canadians employed abroad via reciprocity to foreign nationals employed in Canada via reciprocity.
Exchanges via wet lease arrangements cannot be included in the assessment of reciprocal employment (they fall under two separate provisions under IRPR)
Example: Canadian airline ‘ABC’ has a reciprocal agreement with European airline ‘XYZ’ to employ each other’s airline pilots during each other’s busy seasons. In the summer of 2012, XYZ employed 10 of ABC’s pilots via the reciprocal agreement; in addition, XYZ wet leased 2 of ABC’s aircraft and crew, and ABC sent 20 Canadian pilots to work in Europe on wet leased planes. For the busy winter season in Canada, under the reciprocal employment provisions, ABC is entitled to the LMIA exemption for no more than 17 or 18 of XYZ’s pilots.

It would be helpful for monitoring and reporting purposes if the following information can be captured in the system:

Number of Canadians listed as having worked for the foreign company the past season abroad;
Number of foreign nationals that the Canadian company is employing this year/season; and
The proof that was presented to support the existence of reciprocity.
Note: If reasonable reciprocity cannot be proven, then LMIAs must be sought.

[Eric Janson]

EASA member countries are considered one country for all that has to do with aviation.

That's not correct.

https://www.easa.europa.eu/

You are licensed in one EASA country and you are flying an aircraft of another EASA country ? Correct ?

Correct.

[TFWPILOT]

Tax. We do not pay Canadian tax. Why? The same reason the Canadians coming to Europe each year do not pay tax in Europe. The double taxation agreements between our countries means we pay tax on where we are declared permanent residents, i.e. (simplistically) where we live for more than 6 months in a tax year. If we were in Canada more than 6 months a year we would have to pay Canadian tax. We have prior approval from your authorities, negotiated through a Canadian legal firm, that instead of paying Canadian tax and then claiming it back when we leave, we just pay none in the first place. A lower burden on the admin system I'm sure you'll agree. To sum up, we continue to pay tax in Europe, your guys continue to pay tax in Canada. I would say that is fair.

I expect you understand Boeings better than you understand taxation.

The double taxation agreement means that you deduct the amount of the tax you pay in Canada on your earnings in Canada, from what you owe in your home country and so pay less in your country of domicile. It doesn't mean you don't pay any tax in Canada, nor does it mean that any tax you pay in Canada can be reclaimed from the Canadian government when you leave.

While *you* pay the same either way, it's not the same result overall. We who live in Canada require the tax you must pay on your Canadian earnings to stay in Canada and benefit the economy that enables you to earn those Canadian dollars.

Your Canadian earnings must be taxed in Canada.

My mistake, yes it seems that this is indeed what is happening. Its all going on behind the scenes though by our payroll. Looks the same to us on our payslips!!!

[Gilles Hudicourt]

Don't worry about compliance with the Canadian taxman. Sunwing has you covered.

Last year, I overpaid into my RSSP by accident. Here is the Revenue Agency paperwork I received since. Am forced to hire the services of a tax accountant to sort it out. They went back to 2004 to find a bug. And I don't owe them one cent (my airport parking lot tax assessments for 2011 and 2012 are also in there somewhere)


https://docs.google.com/file/d/0Bx7NB27 ... cslist_api

[60N30W]

I would even go so far as to say that, aside from income tax, we put more money into the local economy than a local Canadian pilot would. We tend to treat it as a paid holiday, so we eat out, rent cars, go travelling, go skiing, watch hockey, stay in hotels, buy domestic flights, buy souvenirs and tend to live a lifestyle of spending more than we would back home. Not to mention the money the company is spending on apartments and cars. Trust me, I don't end up taking much of my earnings home, it usually ends up in the pockets of local Canadian business owners anyway. I'm sure this is similar for the Canadians that Summer in Europe.

TFWPILOT

TFW

I doubt you are putting as much into the local economy as a Canadian pilot. You are not paying a mortgage or property tax here, I doubt your kids are here full time ( if you have) and so you are not buying clothing for school, food for lunches, or paying fees for their sports teams, music lessons, drama, etc...you are not buying winter tires or shopping at Home Depot........ I could go on and on, but you get the point you are not putting more money into the local economy.

One thing you mentioned above has me wondering if you really are a TFW, why would you rent a car when the company is supplying you with one? Perhaps a typo on your part.....

Regards

[Gilles Hudicourt]

This is part of the letter of approval that ESDC provided to Sunwing with regards to its 2013 application for 120 TFW pilots.

https://www.dropbox.com/s/19uawro7ogffb ... 7.png?dl=0

Sunwing, for the purpose of this Labour Market Opinion Application, will be considered the Employer of Record and will be responsible for:

-Directly compensating the foreign workers as an employee (not as an independent contractor) at or above the prevailing wage as indicated on the Labour Market Opinion an.d Annex, and making all the necessary deductions.

-Being able to demonstrate the conditions regarding Wages, Occupation, and Working Conditions, set in the Labour Market Opinion and Annex, are substantially the same as offered the foreign workers named in the LMO, in a future Employer Compliance Review.

Failure to do so may result in a Non-Compliant finding.Also, Employment and Social Development Canada will not consider additional benefits, included in the LMO application or contract, such as: per diems, vehicle allowances, and accommodation allowances, as part of the median wage paid to the foreign worker.

Then there is this email from ESDC to the law firm representing Sunwing in its application:

https://www.dropbox.com/s/2stvez5zi55hb ... 2.png?dl=0

Thank you for clarifying Sunwing's relationship with TVS and the role TVS plays in administering pay to foreign pilots. Notwithstanding your note however, we do not consider this to be a tripartite arrangement as the LMO application was submitted with Sunwing as the sole employer of record and, following our discussions, it was confirmed that Sunwing will take full accountability as the employer of record. The LMO was issued with a note to file that clarifies that Sunwing is accountable for ensuring that all obligations of the employment relationship for these pilots are fully met, including administration of pay.

As a result, in the context of a future compliance review or an inspection of this LMO, I would like to clarify that any findings of noncompliance on the part of TVS in terms of pay administration or any other employer responsibilities while these pilots are working for Sunwing under the terms of this LMO will be attributable to Sunwing as the sole employer of record. This is what was agreed to in advance of issuing the LMO.

This is ESDC telling Sunwing that the pay of the TFW pilots must go through Sunwing and not through a third party (the TFW's employer in Europe)

This allowed Sunwing to not only hide the real salaries these Travel Service (TVS) pilots were earning in their country, but it also allowed the TFW to not be declared to the Canada Revenue Agency.

I wonder how compliant Sunwing was with these requirements in 2013-2014 and 2014-2015 ?