Air Canada said it was set to "gradually resume service" on Tuesday after reaching a "mediated settlement" with its flight attendants' union.

"The Strike has ended," wrote the Canadian Union of Public Employees' Air Canada branch on Facebook, referring to a "tentative agreement" reached with the airline.

The union said the agreement will guarantee members' pay for work performed while planes are on the ground, resolving one of the major issues that had driven the strike.

"We are required to advise our membership that we must fully cooperate with resumption of operations," the statement added.

Air Canada: What was the strike about?

Since flight attendants walked out on Saturday, Air Canada cancelled around 700 daily flights, leaving around 130,000 travelers a day stranded at the peak of the summer season.

The Canadian Union of Public Employees (CUPE) said flight attendants would not return to work until Air Canada addresses wages and ground duties, such as boarding passengers, for which they are currently not paid.

Currently, the flight attendants are paid only when they are flying.

Air Canada's unionized flight attendants walked off the job on Saturday after contract talks collapsed.

The Canada Industrial Relations Board has deemed the strike unlawful.

Air Canada's chief executive, Michael Rousseau, defended the airline's offer of a 38% compensation increase over four years.

Government called for quick solution to Air Canada strike

Canadian Jobs Minister Patty Hajdu had called for negotiations and a quick labor deal. Hajdu also increased pressure on Air Canada by announcing a probe into airline pay.

Prime Minister Mark Carney had also urged both sides to resolve the dispute quickly, saying hundreds of thousands of passengers are being "disrupted by this action."

Edited by: Sean Sinico