OTTAWA, June 27 (Reuters) - Canada's federal government

intervened on Thursday to prevent a strike by maintenance

engineers at WestJet Airlines, the country's second-largest

carrier, to avoid more flight cancellations ahead of a busy

holiday weekend.

Labour Minister Seamus O'Regan said he had ordered the

country's industrial relations board to impose final binding

arbitration in the dispute between the airline and the Aircraft

Mechanics Fraternal Association.

"The parties still remain far apart today, and tensions have

only increased," he said in a statement.

The union said there was no modern precedent for the move,

adding it would comply with the order and direct its members to

refrain from any unlawful job action.

WestJet said on Wednesday it had begun canceling flights

ahead of the strike, which could have started on Friday. Monday

is Canada Day, one of the country's most important holidays.

WestJet, which is backed by Onex Corp ( ONEXF ) and competes

with Air Canada ( ACDVF ), has been facing demands from employees

for better working conditions and higher salaries.