Shannon Group to restore 20% pay cut when passengers hit one million

Unions representing 160 workers such as Airport Police and firefighters reject offer

The Shannon Group has stated that it will restore a unilateral 20 per cent pay cut imposed on its workforce once airport passenger numbers reach one million.

However, any pay restoration may not be until the second half of 2022 as Shannon Airport may not reach the target before then.

The group told the Labour Court that it estimates passenger numbers for 2021 will be well short of one million due to the pandemic and it is more likely that numbers will be around 600,000.

The group said that passenger numbers collapsed last year to 360,000 from 1.72 million in 2019.

Unions representing 160 workers at all grades and including Airport Police and firefighters have rejected the offer by the Shannon Group to restore the 20 per cent pay cut once passenger numbers top one million.

At the Labour Court, unions were seeking restoration of the 20 per cent pay-cut imposed last year and a plan to return the money deducted since September to the members affected.

However, deputy chairman of the Labour Court Louise O’Donnell has recommended that unions and management re-engage over the next six weeks to see if an alternative solution can be found to achieve savings that would remove the need for the pay cut.

Frontline staff

Ms O’Donnell has stated that if the parties can’t come to an agreement, the Labour Court will then make a recommendation with no need for a further hearing.

Ms O’Donnell has also asked the Shannon Group to restate its position to restore pay cuts once passenger numbers reach one million.

At the Labour Court, the Shannon Group stated that the value of the pay cut is €45,000 per fortnight.

The unions told the Labour Court that the 20 per cent pay cut on workers earning over €30,000 was imposed despite union demands for a postponement of the measure.

In its submission to the Labour Court, the Shannon Group said that at the time the pay reduction was communicated and implemented the airport had lost 90 per cent of its business and was protecting 80 per cent income for frontline staff required to work full hours.

Workers at the airport have been able to avail of the Government’s Covid wage subsidy schemes.

The Shannon Group told the court that the aviation sector is facing unprecedented challenges in the coming years and that it wants to protect as many jobs as possible and needs to implement flexible operating measures wherever possible.

The Shannon Group stated that its 600,000 passenger estimate for 2021 “is totally dependent on the Government guidelines in place in respect of travel and Covid 19 and any knock-on effects arising from same”.

Flexibility displayed

The unions Siptu, Forsa and Connect told the Labour Court of their members’ “frustration, annoyance and upset” at the unilateral action by the Shannon Group in imposing the 20 per cent pay cut where the unions had been engaging with the employer.

The unions pointed out that they had successfully engaged with other employers in the aviation industry and had avoided unilateral action and the negative consequences that flowed from such action.

The unions stated that they have displayed flexibility throughout the downturn despite outstanding industrial relations issues not being addressed.

The unions state that management has continuously broken and failed to implement a Work Relations Commission (WRC) agreement of February 2019.

The unions stated that the manner in which the pay cut had occurred had created “a distrust” in respect of engaging with the employer in a full and frank manner.

In response, the Shannon Group, while acknowledging that taking unilateral action was not productive in a collective bargaining arena, said it felt at that time that they had to act.

The Shannon Group stated that the difficulty for it was because of the uncertainty in the aviation industry they needed the savings generated by the pay cuts.

The Shannon Group stated that at conciliation prior to the case coming before the Labour Court, it had put forward proposals which they felt would remove the need for a straight pay cut but would require the ability for the employer to flex working hours to meet demand.

The group stated that this proposal, along with the proposal to restore the 20 per cent once passenger numbers hit one million, was also rejected by the unions.