Update on UK Pilots Negotiations and Strike Ballot

CHC Helicopter Corporation advises that the strike ballot conducted by BALPA, the union representing 149 of the 209 pilots employed by CHC's UK operating subsidiary, CHC Scotia Limited, was concluded on October 31, 2001. Of 149 pilots represented by BALPA, a total of 138 votes were cast, with 109 unionized pilots voting to authorize strike action at a future date and 29 voting against. Accordingly, 73% of the unionized pilot work force, but only some 52% of CHC Scotia's total pilot work force, have given a mandate to strike if the union decides to do so.

As previously advised, no withdrawal of services is permitted under UK law except after a 7 days formal written notice to CHC Scotia that strike action may be initiated; this strike mandate expires 28 days after completion of the strike vote (October 31).

In calling the strike vote a month ago, BALPA advised it was doing so in order to have CHC Scotia present a further, improved offer. CHC Scotia maintains that its current offer of salary increments over three years is very fair to its pilots in the existing market and represents a significant commitment from the employer.

CHC Scotia has offered to resume negotiations through an independent mediator, in order to facilitate a meaningful exchange of positions and to enhance the likelihood of settlement without a withdrawal of services. At this point, CHC Scotia is strongly of the view that third party assistance is necessary to achieve a mutually satisfactory resolution of this dispute. BALPA has not accepted mediation, but has indicated it would let members decide on the resumption of talks with a mediator.

CHC reiterates that its final offer of increased salary and pension benefits over the next three years is exceedingly fair to its pilot work force, as compared to others in the same profession worldwide and also to fixed wing pilots going forward. CHC Scotia is in constant communication with its UK customers on the status of negotiations, and with respect to the recent pressure from BALPA. CHC does not anticipate that this threat of industrial action will have a material adverse effect on the Corporation.